How to Invest in a Broadway Show
I get a lot of questions from readers, all over the world, expressing interest in investing in a Broadway or an Off-Broadway show. Usually they are unsure about how to get involved and, more importantly, they want to know how to pick their first show. Since this seems to be such a hot topic, I thought I’d dispel a few of the nasty rumors associated with investing in Broadway or Off-Broadway shows, and also give you my checklist of how to choose shows to invest in. First let’s tackle the rumors, and then the checklist.Broadway Investment Rumor #1: Investing in Broadway Shows is Only for the Super-Rich.Because Broadway capitalizations can range from $2 million for a Play up to $20 million for a Broadway Mega-Musical, many people fear that the “entry point,” or the amount of money required for an initial individual investment, must be astronomically high. Not true. While the average small investment in a big Broadway show is probably about $25,000, I have seen many shows where investors were able to get in for as little as $10,000, and even a few where the entry point was only $5,000! There are a lot of publicly traded mutual funds that don’t allow you to get in at that level. Lower investment thresholds are particularly common in the Off-Broadway arena. What determines the lowest investment level? Here’s how it works.Capitalizations are divided into ‘units,’ just like stock shares, and what defines each unit is up to the Producer. Some Producers like to have a round 100 units per show, regardless of the capitalization. Some like to pick the lowest amount they can accept as an investment (since some shows are limited to the number of investors they can have). And some just make it up arbitrarily. Regardless of how the unit is determined, here’s a tip: If you’re considering a show and get sticker shock when you hear the price of one unit, ask for a partial. Splitting units ain’t like splitting an atom. It can be done with ease. Depending upon a variety of circumstances (including how hot the property is, who the producer is, and whether or not other investors took “round units”), it may be possible for you to invest in a smaller amount than the “ask.” The key, of course, is to never be pressured into investing more than you’re willing to lose. If the entry point on one project is too high, don’t worry, there will be others.Broadway Investment Rumor #2: Investing in Broadway Shows is Only for the Super-Crazy.Many people think that it’s bonkers to get involved with Broadway. The fact is, if you’re an individual of a certain net worth, your traditional financial advisor will probably recommend that you allocate a certain amount of your investment portfolio (usually about 10%) to higher risk instruments, or so-called Alternative Investments, in order to diversify yourself. Most Alternative Investments require investors to be considered ‘accredited,’ which in the U.S. means a net worth of at least one million dollars, or having made at least $200,000 ($300,000 if joint-income) for the past two years. Although many Broadway shows also prefer accredited investors, this is not the case with every show.Why would Broadway, with its high risk but potentially high return, be excluded from that list? In fact, it isn’t. According to Wikipedia’s entry for Alternative Investments, they are an “investment product other than traditional investments such as stocks, bonds, or cash” and that “wine, art and antiques, Broadway shows, movies, indeed any store of value, might also be considered an alternative investment.” Alternative Investments, including Broadway and Off-Broadway shows, are undoubtedly high risk. The commonly quoted statistic is that only 1 out of 5 Broadway shows recoup their investment (that ratio is even lower for Off-Broadway shows). But this is not, by any means, the only high risk instrument on the market.Investing in Broadway shows is a lot like investing in a restaurant or, frankly, in any entrepreneurial start-up. In fact, according to a recent article by Nick Malawskey in the Centre Daily Times: “For every 10 businesses that start, seven will cease to exist in 10 years. Two will break even. Only one will really succeed.” This puts the success rate of start-ups at the exact same percentage as I just quoted above – 20%! See, it’s not as bad as we thought. And, with proper due diligence you can increase those odds.And remember, with big risk can also reap big rewards. Even if you do end up performing according to the stats, the goal and hope is that the 1 show out of 5 which does recoup, ends up paying for any other previous losses (it’s a marathon not a sprint), and then some. Imagine what it would have been like to invest in “Annie,” “West Side Story,”"Cats” or “Wicked.”Broadway Investment Rumor #3: Investors in Broadway Shows Belong to an Exclusive ‘Club’ that Doesn’t Accept New Members.While it is true that there are a lot of Broadway investors that have been in the circle for a long time, it’s not as closed door of a club as you think. While it can be hard for a new investor to get in on the hottest shows coming to town, it’s not impossible. And, Producers will sometimes let you get in on a ‘sure-thing’ (which doesn’t exist, by the way) if you also agree to come into something a bit more risky. However, it is a relationship business, and preferential treatment is often given to investors who have been doing it longer, and to those that have been faithful to the Producer. So what does a new investor do? Start the relationship. Call a Producer. Email them. Fax them. Simply state that you’re looking to invest in a specific show (if you know one that they are about to do), or ask to be put on the list to be called about their next show. It’s not a commitment for either party, and I don’t know any Producer out there who would mind putting you on a “potential” list. Just make sure you are serious about your interest.Now that we’ve overviewed the three biggest obstacles potential investors often tell me prevent them from taking the first step and joining the ranks of Broadway and Off-Broadway investor, just how do you choose a project to invest in? Once you’ve decided that investing in a Broadway or Off-Broadway show is something you definitely want to do, you should step through my checklist of how to decide whether or not to invest in a particular show.Broadway Investing Rule #1: Have Passion for the Project.Broadway shows are often referred to as the “children” of Producers and Investors. Shows need the same type of care, hand-holding, and unconditional love; so much love, that even when your kid F***s up royally, you (as the parent) will still love him, right? Unfortunately, the odds are that your “kid” is going to disappoint you, so you better make sure that your bond is so tight, you won’t care either way. This theory is based a bit on famed investment guru Peter Lynch’s theory of “invest in what you know.” Peter believed you should put money into companies that make products which you see and use every day (and products that you can’t live without). I believe this can, and should, be adapted to entertainment investments as well. Invest in shows that you can’t see NOT happening. Invest in shows that you believe are important to be seen; whether that’s because it has a socio-political message, whether that’s because it features an amazing performance by an legendary actress, or whether that’s because it’s so much fun, that the audience’s day will be better just by experiencing the show. Invest in shows that you love.Broadway Investing Rule #2: It’s All About Who’s Driving the Boat.Before investing in a mutual fund, Wall Street geeks will tell you to look at a variety of factors, one of the most important being who is managing the fund. You’ve got to know who is making the day-to-day decisions. What is their track record? Where did they learn to do what they do? How long have they been doing it? These are all questions you need to ask before investing in a Broadway show. Look at the Producer’s resume (you can find them all on the Internet Broadway Database ibdb.com). Have they produced shows that have recouped? How many hits do they have? How many misses? Would you have produced similar shows? Do you have similar tastes? Choosing to invest with Producers with a proven track record is one of the best ways you can reduce your risk when investing in a Broadway or Off-Broadway show.Broadway Investing Rule #3: Just Like an Actor, You Have to Know Your Objective.What do you want out of investing in a Broadway show? Different objectives will greatly affect what projects you choose to do. Do you want to make money? Do you want to get access to opening night parties, etc. so you can network? Are you looking to get inside access to agreements and figures, etc., so you can learn more about how to produce your own show? Do you want to support the work of a specific playwright?One of my favorite “objective” stories is about the investor who was thinking about graduate school as a way to learn how to produce. They decided against it, and took the money they were going to spend on tuition and invested it in several shows. They thought there was more to learn by playing the game. Last I heard, they were doing pretty well and beating the odds.There are a zillion reasons to invest in a Broadway show. Make sure you have at least one.Broadway Investing Rule #4: Don’t Try and Be a One-Hit Wonder.We all want our first time to be perfect (I even wrote a show about it!), but often our first time out isn’t what we hope it will be. Don’t expect to knock one out of the park your first time up at bat. When signing up to invest in Broadway, imagine that you’re a baseball player playing a full nine innings. If you strike out the first time (or even the second and the third) don’t worry, you could hit a homer in the bottom of the 9th and win the game.If your first show doesn’t make it, have a post-mortem with yourself (and with the Producer) and try and determine why it didn’t work. Learn from it, and apply those lessons to your next time up at bat. Your odds of success should get better each time. Just don’t pull yourself out of the game.Broadway Investing Rule #5: Examine the Lay of the Land.It’s impossible to time the market. But, in a playing field as small as Broadway, with its limited audience, it’s important to take a look at your potential competition. Are you doing a new musical at a time when six other new musicals are opening? How do your stars match up against the other shows’ stars? Are you the only classic play? Are you the only comedy? The big TV networks program their seasons so they can appeal to all of the appropriate demographics, without too much weight on one type of show. Since Producers are mostly independents, we can’t program collaboratively, but as an investor you can look to see if your show is going to get lost in a sea of other similar shows, or if it will stand out amongst a lack of competition, without having to place $125k New York Times full page ads.So there you have it! The above are the five basic questions I first ask myself when contemplating investing in a Broadway or Off-Broadway show. There are countless others you should ask when you get into the details of the production after you examine the budget, find out who’s directing, etc., but these will get you started on the road to investing in a show.You’ll notice that a lot of the above rules and checklists are very similar to the rules and checklists for investing in the stock market or any market (invest for the long haul, know your objectives, risk tolerance, etc.). And that’s the most important thing to remember. Too many people think investing in Broadway is a hobby ( which it can be), and in those cases you’ll probably only hit a winner on the average 1 out of 5 times. But, Broadway is big business, and should be treated as such. And if you apply the same principles you’d apply to other investment vehicles and do the due diligence, there’s no reason you can’t turn that hobby into something that is fun, educational, and yes, even profitable.
7 Reasons Why You Will Fail to Make Money Online and How to Avoid Them
Every month over 60,500 people do a search on Google trying to to figure out how to make money online. That’s over 726,000 people a year who embark on this journey.But out of that 726,000+ people who inquire about making money online, how many of them do you think actually succeed at it?Well, here’s a reality check… less than 3% of them actually do.And out of that 3% who do, very few of them actually go on to earn a full time income online year after year after year.But it is possible, and you can do it too.In my six years of being an online marketer, I have seen a whole lot of people fail, but I have also seen some succeed.Because of this, I’ve been able to identify 7 common mistakes that people make when they don’t succeed.These 7 mistakes will not only keep you broke and frustrated, but they will also prevent you from having any long term success online even if you do manage to make a few bucks here and there.So if you want to succeed at making money online, here are 7 mistakes that you definitely need to avoid making.Mistake #1 – Failing to Define Your “Why” for Wanting to Make Money OnlineNow I know that this may sound cliche, but it’s the truth. You can’t just say “I want to make money online”. You must define “why” you want to make money online.Do you just need to earn a few hundred extra dollars every month to pay some bills?Do you want to make some extra money so that you can go on vacation…Or do you want to build a REAL online business that will allow you to quit your day job and tell your boss to shove it?Determining what your why is is very important because it will help you to determine what path you need to take with your online business.Mistake #2 – Focusing on Strategies Instead of SystemsLearning how to make money with Facebook, YouTube, and SEO are all really great strategies. But that is exactly what they are, strategies.And you can make money online with these strategies.But if your goal is to build a REAL online business that will feed you and your family for life, then you need to focus on learning “systems”.Learning about systems means that you need to learn develop certain skill sets such as putting together a marketing funnel that produces sales on autopilot, writing effective email copy, and making tweaks to your marketing campaign to increase conversions.Too many people come online and try to build an online business simply by using strategies alone and ignoring these skills.Doing this will definitely result in failure.Mistake #3 – Screwing up Niche ResearchObviously, you can only sell products to people who want to buy them. This means that you gotta get your niche research right. Just because people are online looking for information about something does not mean that they are willing to pay for it.Mistake #4 – Failing to Build an Email ListThere is nothing more powerful than having your own database of customers that you can promote products to over and over again. Building an email list is exactly how you obtain this database.With an email list, you can send instant traffic to any product or service that you feel is relevant to the list. It also gives you the power to “print” money anytime that you need it.Mistake #5 – Failing to Segment Your Email ListJust because you have an email list does not mean that you will make money from it. If you don’t send the people on your list offers that are relevant to them, they won’t buy anything.Do this too many times and they will even unsubscribe from your list.That is why you need to segment your list into groups of people who have similar interest. Then you can send relevant offers only to those people who you know are already interested.Mistake #6 – Not Sending Enough EmailsOnce you get someone on your list, you need to talk to them… consistently. This is how you build a relationship with someone. That means that you need to email them as often as possible.You do this by sending them helpful information that can help them to achieve their goals. This information can be in the form of funny stories, useful articles, tutorial videos, and much more.The goal is to get the people on your list to see you as a person of authority in your niche and believe that you are someone that they can trust. That way, when you recommend a product or service to them, they are more apt to take your advice and buy it.Mistake #7 – Failing to Taking ActionThis is the biggest mistake that will kill your online money making dreams the most. Once you learn what to do and what not to do, you have to take action. It does not do you any good to read this article or spend your hard earned money on any online marketing course if you are not going to follow through with what you learn.Now that you know what the 7 mistakes are, start taking action not to make them. If you can do that, you will have a great opportunity to become one of the 3% of people who make money online instead of the 97% of people who don’t.
2 Tips To Make Money Online
Here are 2 very important tips to make money onlineFocus On 1 Proven System And Stick To ItIf you jump around from one proven system to another, then you are setting yourself up for failure. If you really want to succeed and make money online, then you need focus on one proven system and give it the time it needs to produce results. Most upcoming internet marketers will go online excited to begin making millions online, but never really put in the work required to make it a reality. Doing some research, finding a proven technique are all good steps to follow, but if you are switching back and forth between strategies then you will never make substantial income online.You have to realize that you are not going to make millions online overnight. Even the most aggressive marketers online didn’t make their first sale online for several weeks before they started seeing results.Be Aggressive And ConsistentI can tell you how many people tell me that they have tried to make money online for years. The truth of the matter is honestly, if you have been at it for years and not made a decent amount of money online then you have been going at it the wrong way. If you put in 10 hours one day and don’t put in anymore time for a week or two, then you are setting yourself up to fail. If you want to succeed as an online marketers, you will need to be aggressive and consistent every day until you get where you want to be. Once you get to that level, you can delegate some of your time consuming duties and concentrate on taking your next steps.If you follow these two simple steps, you will be in a position to make a lot of money online and do whatever you always wished you could do, but never could because of money. So start right now by taking an aggressive and consistent approach. Following these two steps is the only way to make a lot of money online and join the big leagues of internet marketing.The world of internet marketing can be a tough field to get in to and be successful, but if you are committed anything is possible. Don’t get hung up if you only make a few sales in your first few weeks, because in time those few sales will turn into hundreds of sales as long as you stand by your product or the product you are promoting for someone else.