Broadway has a new matchmaking service for hopeful producers and investors.
Introducing eager backers to attractive investment opportunities on Broadway, an innovative organization named 42nd.club aims to bulldoze the barriers to entry. It allows accredited investors without industry connections to purchase stakes in certain shows that might otherwise be inaccessible.
“Broadway is very much a relationship business,” explained prolific investor Brisa Trinchero. “Generally, an interested investor would need to know someone who is involved in capitalizing an upcoming Broadway show to become aware of investment opportunities.”
Mark Severs and Jesse Horwitz had a friend who was producing Fun Home, for example, and were able to invest $25,000 in the show before it won the Tony Award for Best Musical in 2015. But, not everyone knows people who are Broadway producers.
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Forbes reported that, after a performance of Lin-Manuel Miranda’s first musical, In the Heights, Trinchero approached one of its producers, Jill Furman, and handed her a blank check. “Whatever show he does next,” she insisted, “I want in.”
Several years later, when Furman was raising cash for Hamilton, she invited Trinchero to invest a five-figure amount. “The producers were able to capitalize the show from their inner circle, so interested investors had very little chance of getting involved,” the ambitious backer recalled.
But, through 42nd.club, less acquainted angels might also be able to access the inner sanctum of investing on Broadway. Combining elements of a book club and a country club, all of its 20-plus members share and discuss their special investment opportunities with each other.
“As a single investor, you get every opportunity that comes directly to you,” said Phil Kenny, one of its founders. “However, as a member of 42nd.club, you get every opportunity that comes directly to you, as well as every opportunity that comes through all of the other members.”
Presented with a buffet of Broadway shows to choose from, members of 42nd.club can invest in whichever theatrical productions pique their interest, or choose not to invest at all. “You could be a part of the club and turn down every single opportunity that comes to you,” confirmed Kenny.
Like other investing clubs, the members benefit from pooling their knowledge and resources. Prospective investors can gauge the commercial potential of productions from the reactions of their peers, and team up to take larger stakes in shows.
Kenny and three other patrons each raised $62,500, for example, to secure a producing credit above the title of Waitress. If each member had invested the same amount alone, then none of them would have received similar recognition.
The next show that members are backing, Anastasia, opens at the Broadhurst Theatre in March. Kenny knew the lead producer from investing in his previous show, The Visit, and raised $500,000 for the new musical.
Hoping to expand its reach on the Great White Way, 42nd.club has now lifted its velvet ropes. Individuals with a net worth of at least $1 million, or an annual income above $200,000 are eligible to enter. “We’d be happy to hear from any accredited investor who is interested in joining in on the fun,” Kenny smiled.
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