What percentage of Broadway shows recoup and then make a profit?

[brightasyellow]

Posted: 8/23/10 at 10:55pm

I was just wondering because it seems that very few do. On the commercial side of things, this seems like a failure and yet Broadway shows continue to be put on. How does Broadway keep going?

[JMPlayer6]

Posted: 8/24/10 at 7:11am

I recall reading somewhere recently---forget where it was---that only a third of Broadway shows turn a profit.

[binau]

Posted: 8/24/10 at 7:14am

I think producing might still be appealing because you have the chance to win big (see: Wicked etc.)

[Smaxie]

Posted: 8/24/10 at 8:37am

If a show doesn't pay back on Broadway, it can sometimes pay off after a few years of subsidiary productions.

[AnythingGoes2]

Posted: 8/24/10 at 9:31am

Its a gamble like everything.

I'd say a third if not less return investment/profit for original mounts of shows.

But as Smaxie said, they can later turn to profit. Something like Footloose may not have returned on Broadway - but I image its raking it in now due to regional/school/london

[twinbelters]

Posted: 8/24/10 at 6:49pm

Much like investing in visual art, investing in a Broadway musical theater production carries a certain amount of prestige. Plus, there are a lot of people with a lot of money to burn. They just ain't us. I am imagining many investors appreciate musical theater and respond to the fact that musicals are a wholly American invention.

And, yeah, a hit can pay off BIG.

[Phantom of London]

Posted: 8/24/10 at 7:02pm

A big hit does pay big bucks, but seems most of the dosh goes to big multi-national companies now, like Wicked or Lion King.

I wonder if shows like Legally Blonde, Chitty Chitty Bang Bang, 9-5 and Shrek that all probably lost money on Broadway have/would recoup on tour?

[philly03]

Posted: 8/24/10 at 7:08pm

I think Leslie Bricusse in an interview for the leading up to Jekyll & HYDE opening on Broadway said only 1/8 shows will make a profit (maybe it was new shows only).

I suppose the '90s were different, as there were years where every show except one or two flopped ('96-'97, no new musical recouped (ironically, J&H); '97-'98 only had Lion King I believe); etc).

[Mildred Plotka]

Posted: 8/24/10 at 7:13pm

You can make any topic about Wildhorn can't you?

[ljay889]

Posted: 8/24/10 at 7:16pm

He really does.

[philly03]

Posted: 8/24/10 at 8:25pm

Well, he's back this season .

It's not even from Frank...it's from Leslie who did plenty of other things?? Just thought people would be interested.

[James885]

Posted: 8/24/10 at 9:47pm

To answer the OP's question: I don't know the specific percentage, but it's likely not very high. Most Broadway shows don't recoup, at least not while they're running on Broadway. Some go on to recoup via national tours and regional productions.

Still, folks are lured to producing in the hopes of landing the next smash hit. Like others said, investing in a show is a gamble that can yield big profits or big losses. For every Wicked, Phantom, or Lion King, there are several Lestats, Cry-Babies, and Little Mermaids.

And there's also a certain amount of prestige involved in producing a show that may not be a commercial hit, but a critical darling (like Grey Gardens).

Updated On: 8/25/10 at 09:47 PM

[misto625]

Posted: 8/24/10 at 11:49pm

I think the percentage of shows which recoup is closer to 20%, or 1 out of every 5. For people who have a high level of net worth, making "high risk" investments, such as investing in a Broadway show, is actually a good way to diversify their portfolio, but should only constitute less than 10% of their total investments. If the show does well, you make more money. If it doesn't, you can swallow the loss and get a nice tax write-off.

[allofmylife]

Posted: 8/25/10 at 12:39am

There are also tax write-offs and, as Max Bialystock would tell you, some people actually need to lose some money every year. It's a helluva lot more sexy to lose money on a Broadway show (Frank Wildhorn excepted) than in some gray-walled financial scheme.

[wonderwaiter]

Posted: 8/25/10 at 12:42am

As was mentioned, the return on investment doesn't end with the Broadway production. There are the performance rights for regional and amateur productions, as well as returns on a cast recording if one is made.

There is also the "prestige" factor that extends beyond corporations. I worked in a Mom-and-Pop bookstore for a few years and put Not Since Carrie on my Staff Picks shelf. One of our regular customers bought a copy and while I was ringing him up he told me he had invested money in Dear World. While I'm sure he would have loved for it to have been a huge hit, he hadn't invested enough money in the production to make or break him and buying a book where it was discussed tickled him pink. For him, having invested in a flop that was notable enough to be written about was payoff enough.

[brightasyellow]

Posted: 8/25/10 at 12:31pm

Thanks! I also figured that now that there are a bazillion and ten producers listed for each show (slight exaggeration), it's less risky.

Don't get me wrong, I'm grateful that there are people willing to produce shows that may not recoup, I just wondered how it worked financially.

I find it all very interesting.