What is recouping on Broadway anyway? Part II.

Last week, I published the results of some research I did into the recoupment % of new Broadway musicals over the last half a decade.

The conclusion was that the % of those musicals that are recouping is consistent with the age ol’ industry average of about 20%.

But after I did the math, I took a deeper look at the actual new musicals in this period that were in the black.

Here they are:

Fun Home
Waitress
School of Rock
Hamilton
Dear Evan Hansen
Come From Away
The Band’s Visit
Ain’t Too Proud*
Hadestown

*An assumption based on current grosses.

It’s a fascinating list . . . isn’t it?  Do you see what I see?

Only one of them, School of Rock, is a “big” movie to musical adaptation (Waitress and Band’s Visit were films – but not high profile by any means).

And the only jukebox tuner to make money (we’re assuming this) is Ain’t Too Proud.  

The rest, a whopping 78% . . . are small to medium-sized musicals, and most of them with small to medium-sized brands (or in the case of one of the biggest successes, Dear Evan Hansen, NO pre-existing brand).

And none, zero, opened with any Hollywood stars.

So, while it’s easy for Broadway Producers, Broadway Investors and even Broadway Theatergoers to think that what is making money on Broadway are the giant movie-to-musical adaptations or big-budget spectacles . . . that’s just not the case.

Just because they’re making it to Broadway, doesn’t mean they are making it on Broadway.

And if you were choosing a show to produce, invest in, or write, you might opt for the lesser-known, more original, and unique properties than the big-branded one.

It might seem like more risk on the way in, but the numbers say these types of musicals are actually less risky than the others . . . especially since their running costs are typically lower, which means higher profit margins when they do recoup (again, see Dear Evan Hansen).

But what I love about the 78% of those new musicals that are cashing in is this:

Take a second and look at the subjects of these new musicals.  The story of Alexander Hamilton told through hip hop.  A teenager dealing with anxiety who may be suicidal.  A lesbian comic book writer whose secretly gay father kills himself.  What happens in a Canadian town after 9/11.  A show that has “Hades” in the actual title!!!

I’d bet you the capitalization of all of them, combined, that at one point, someone said to every single one of the creators of these shows . . . “This should never be a musical.”

And not only are they musicals, but they are money-making musicals.

So to the TheaterMakers, make what you wanna make.  That’s where your heart . . . and the money is.

– – – – –

Like this series?  It’s not over yet.  Next week, I tackle REVIVALS.  Sign up here to be the first to read the results of my research.

Want a job in the theater? Join our TheaterMakers Studio Production Team Database!

The theater is a collaborative art form.  Even one-person shows can’t be done on their own.  (At the very least, you need at least one person in your audience!)

The cool thing about meeting the right collaborator is that your energy to make something happen doubles, triples, and increases exponentially with each person you add.  And then one day, you’ll find yourself sitting in a Broadway theater teching your show, looking around at the hundred people working on it with you. . . and remembering when it was just you, in your room, with an idea (yes, I’ve had this moment several times).

This is why we encourage TheaterMakers to meet other TheaterMakers and get them signed up on their show, or simply just meet for coffee and brainstorm!

And, believe it or not, one of the most common questions I get asked is . . . “Ken, where can I find a Director/Designer/Composer/Orchestrator/Actor, etc.”  Shocking, right?  Because we all know how many people are desperately looking to work as a Director/Designer/Composer/Orchestrator/Actor, etc.

That’s why we’ve started a TheaterMaker Production Team Database . . . so when you need someone for your show . . . or if you’re a TheaterMaker looking for a job on a show . . . you know where to look.

Post your profile if you’re a Director of plays or a Choreographer of musicals.  Or a Writer, Investor, Designer or whatever.

Search through the profiles if you’re looking for any of the above, or are just looking to meet someone who shares the same passion of making shows as you do, and see what you can cook up together.

Whatever you’re looking for, it’s in our brand new, free TheaterMaker Database. And it’s now open for your submission and browsing pleasure!

Click here to check it out and create your free profile now.

And do it now.

Ask yourself.  What do you have to lose by signing up?  And putting yourself out there?

Only a possible collaboration that could take you exactly where you want to go.

It takes 30 seconds.  Sign up and start working (with someone else) today.

Sign up for the TheaterMaker Production Database here.

 

What Is The Broadway Musical Recoupment Rate Over The Last 5 Years. Part I.

Since I started working in the business of bway, I keep finding my way back to the same ol’ stat.

1 out of 5 shows recoup their investment (or 20%).

That’s what they told me in 1993.  That’s what I hear they were telling people in 1983.  And that’s what I used as the basis for this book.

But what about TODAY?  Certainly, this percentage has changed over the last few years, especially because of the rise of premium pricing, and the record-breaking box office numbers we’ve been touting with trumpets.

I was curious, so I dug into the data again, and took a look at all of the musicals (we left out the plays this time around) that have opened in the last five years to determine how many have recouped and how many have not.

What did we find?

Drumroll, please . . .

The percentage of Broadway musicals that have recouped in the last half decade is . . . 20.45%.

Remarkable, isn’t it?  The number is the same dang number it has always been.

It’s like Pareto’s Principle . . . just always comes out that way (It may be more closely related to Pareto than we think . . . because it is literally 80/20).

What’s comforting about that consistency is that it’s . . . well . . . consistent.  So as we continue to create economic models for our shows and our business, we pretty much know what we’re working with.  And for those in the Broadway Investing game, who are looking to learn not only how to invest, but how to improve their success rate, they can be confident that they know the odds . . . and can make more intelligent bets (just like the great stock pickers, horse handicappers, and poker players).

What’s not comforting about this consistency (you knew this was coming, didn’t you), is that it has NOT improved over the last decade.  In a period when grosses have increased by 34% (!), profitability has not.

Imagine that for any other industry or business.  If you had a store selling t-shirts, and your sales had that kind of double-digit increase in that limited time, you’d be buying your own private island by now.

But not Broadway.

Why?

Two reasons:

  1. Our costs have increased tremendously over the same period.  As grosses have gone up, so have our expenses.  Advertising, theater rent, technology, more staff, etc,  It all adds up.  It costs more to put on a show than it did a decade ago.  A lot more.
  2. The bulk of that double-digit gross increase is in the big fat blockbusters (The Hamiltons, Lion Kings, etc.).  So those shows may be more profitable, but the shows in the middle of the market, aren’t getting to the black.  And the shows at the low end of the market, are losing more than they used to.

While I’ve always been fighting for ways to increase the number of shows that recoup across our industry, the consistency of this 20% may very well be a law of theatrical nature that we can’t change (and I’ll just have to make sure my own portfolio of shows beat the market – and so far we are doing better than 20%).

Instead of increasing the 20%, we may need to turn our efforts to making sure this 20% doesn’t go the other direction.  See, with booming grosses that grab all the headlines, comes more folks with their hands out.

But as you can see in the recoupment rate of the last ten years, just because we’re making more, doesn’t mean we’re making more.  And we need to make sure everyone, from agents to investors, understand that.

Now . . . what shows are making up that XX% in the last ten years?  Well, that’s where it really gets interesting, and may just help you pick a winner.

But we’ll save that for Part II, next week.

– – – – –

Interested in learning more about recoupment rates and how Broadway Investing works?  Read the only book ever written on the subject.  Check out Broadway Investing 101 here.

 

Broadway Grosses w/e 01/12/2020: Broadway still in hibernation

While the weather was trying to tell us otherwise last weekend, it’s certainly still January on Broadway. Grosses fell a steep 28% last week to $31M. 

Much of the drop was a result of several shows closing last week. But with 19 shows dropping six figures off their weekly gross, the rest of the winter looks grim. When’s spring break again?

You can find the rest of the figures below, courtesy of The Broadway League:

Show Name Gross  TotalAttn  %Capacity AvgPdAdm
A SOLDIER’S PLAY $305,205.00 4,901 84.97% $62.27
AIN’T TOO PROUD $1,266,884.40 10,168 89.26% $124.60
ALADDIN $1,159,820.60 13,230 95.76% $87.67
AMERICAN UTOPIA $1,106,070.00  5,764 99.97% $191.89
BEETLEJUICE $1,243,994.07 12,110 101.39% $102.72
CHICAGO $647,410.10 7,262 84.05% $89.15
COME FROM AWAY $923,883.60 8,505 101.64% $108.63
DEAR EVAN HANSEN $1,106,753.20 7,993 101.54% $138.47
FREESTYLE LOVE SUPREME $1,062,219.00 6,218 101.60% $170.83
FROZEN $1,052,392.50 12,850 95.38% $81.90
GRAND HORIZONS $213,547.32 3,473 74.21% $61.49
HADESTOWN $1,175,197.00 7,445 101.38% $157.85
HAMILTON $2,763,874.00 10,755 101.54% $256.99
HARRY POTTER AND THE CURSED CHILD, PARTS ONE AND TWO $1,153,186.00 12,976 100.00% $88.87
JAGGED LITTLE PILL $1,062,058.00 9,092 101.02% $116.81
MEAN GIRLS $890,812.60 9,292 94.82% $95.87
MOULIN ROUGE! $1,859,181.00 10,451 100.34% $177.90
MY NAME IS LUCY BARTON $478,414.40 4,365 96.53% $109.60
OKLAHOMA! $555,451.10 5,145 98.79% $107.96
SLAVE PLAY $588,514.10 6,178 97.38% $95.26
THE BOOK OF MORMON $1,097,362.50 8,332 99.47% $131.70
THE INHERITANCE $501,028.50 5,380 64.17% $93.13
THE LION KING $1,610,115.00 12,756 94.02% $126.22
THE PHANTOM OF THE OPERA $801,986.02 9,112 70.97% $88.01
THE SOUND INSIDE $630,651.00 6,671 83.55% $94.54
TINA – THE TINA TURNER MUSICAL $1,572,756.00 11,679 98.77% $134.67
TO KILL A MOCKINGBIRD $1,516,362.14 11,531 100.44% $131.50
WEST SIDE STORY $1,443,410.34 12,180 100.00% $118.51
WICKED $1,337,825.00 13,287 91.91% $100.69
TOTALS $31,126,364.49 259,101 93.96% $118.82
+/- THIS WEEK LAST SEASON + $592,219.42      
PERCENTAGE +/- THIS WEEK LAST SEASON + 1.94%      

Today’s blog was guest-written by Ryan Conway, President of Architect Theatrical. Find out more here!

My Broadway Predictions For 2030.

When thinking ahead to future years, the first thing that most people do is calculate their age.

Come on, you know you do it.   How old will you be in 2030?

I’ll be 57.  My daughter will be 12.  (God help me.)

So . . . how old will Broadway be?

Well, there is a big debate about when Broadway began . . . some say it started when the first theater opened down on Nassau street in 1750 (!).  But since that venue was only 280 seats I’d say that’s when Off Broadway began (Yep, Off Broadway preceded Broadway – if that’s possible give them monikers).  Others say Broadway began when the first 2,000-seat venue was built in 1798.

But I put the birthday at the opening of The Black Crook in 1866 which is considered by most to be the first musical, and the first long-running show (it ran for 474 performances – and it was also five and a half hours long!).

That would make Broadway 154 years old in 2030.  How do you think she’ll hold up at that age?  What will she look like?

Last week, I blogged about my top favorite Broadway stories for 2019, and now I’m going to give you five of my crystal ball-like predictions for what I believe will happen on Broadway by 2030!

Let me just say a few chants, sprinkle some sage around my computer, and channel my inner psychic-friends-network.

Here we go, in no particular fortune-tellin’ order:

  1.  Hard Tickets will be extinct.
    Honestly, these will probably be gone well before 2030, but by the end of the decade you definitely won’t ever need a print out of a ticket . . . or, well, anything, for that matter.  In other industries, fingerprints and facial recognition will probably get you access to whatever it is you paid for.  We’ll still be lagging behind (like we always do), but we definitely won’t have those little slips of cardstock anymore.  Sorry, scalpers.
  2. 90% of shows will be recorded and streamed.
    In 2030, we’ll finally figure out the economic model that allows for shows to be distributed via video, providing another revenue stream for the Authors, Actors, Investors, etc.  Now, exactly hen Producers allow the streaming to happen (during the run or only after?) will still be debated.  But we’ll crack the code . . . partly because we’ll have to.  Because if the cost of producing (and you don’t need to be a bloggin’ fortune teller to predict that), we’ll need the additional income to keep our recoupment.  (The missing 10% by the way is for the stars and artists who just never want what they’ve done on video, for whatever reason.)
  3. A woman will be running a theater chain.
    This is not only a prediction, this is a call to action.
  4. Chat boards will cease to exist.
    Gossip won’t, so all those folks who love theater so much they want to talk about it all day, when they probably should be working (or making theater themselves), will have to find a new place to chat.  And they will, because nothing stops passionate people who want to talk Broadway. I know, I was a rec.arts.theater.newsgroup guy back in 1991.   (Remind me to tell you how I met Jeff Marx, the lyricist of Avenue Q online back then.)
  5. Our recoupment rate will stay the same.You’re going to see some data on this in next week’s blog, but Broadway has been recouping 20% of its shows for a long time (despite the fact that our grosses have increased substantially).  As much as I’d like to say we’re going to find a path to more prolific profitability over the next ten years, I doubt it.  We’re a risky industry.  Less risky that most industries in our category, actually, as I talk about here.  Our job may actually be to prevent it from our recoupment rate going the other direction (something else I’m going to talk about next week).Oh, and a bonus prediction . . .
  6. Hamilton will still be running.

So, what do you think of ’em?  Agree?  Disagree?  Got your own predictions?  Mention them in the comments below.

And if you are interested in some other predictions I’ve made in the past, check out my TedXBroadway talk here, which I did in 2012, and predicted 20 years ahead.  Some of the stuff has already come true.

 

 

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