Who can invest in a Broadway show...

OH! I know about this!! I was asking about becoming involved in The Prince of Egypt in London, and corresponded with a producer who told me how much money it would cost to invest. I don't remember how much it was, though. It's somewhere in the depths of my email, unfortunately. So I think anyone can, providing they have the money! 

 

 

macbeth said: "I found this Forbes article interesting, as it answered something I've always wondered about how much money producers and investors have to have to take the risk on Broadway.

Each so-called “accredited investor” should still have earned at least $200,000 for two years (or $300,000 with his or her spouse) and expect to earn the same amount in the current year or have a net worth at least $1 million without counting his or her house."

Yeah, New York law is pretty strict on investing in theatrical productions. I think there is an exception whereby producers can recruit a handful of investors (5, I think?) who do not meet the income and asset requirements, but the bulk of the financing needs to come from wealthier people. The justification is that the risk for a Broadway show is far higher than most other types of investment, and the state wanted to deter producers from pulling a Max Biyalistock and bilking people who can't afford it out of their money for shows that never quite happen.

msmp said: "macbeth said: "I found this Forbes article interesting, as it answered something I've always wondered about how much money producers and investors have to have to take the risk on Broadway.

Each so-called “accredited investor” should still have earned at least $200,000 for two years (or $300,000 with his or her spouse) and expect to earn the same amount in the current year or have a net worth at least $1 million without counting his or her house."

Yeah, New York law is pretty strict on investing in theatrical productions. I think there is an exception whereby producers can recruit a handful of investors (5, I think?) who do not meet the income and asset requirements, but the bulk of the financing needs to come from wealthier people. The justification is that the risk for a Broadway show is far higher than most other types of investment, and the state wanted to deter producers from pulling a Max Biyalistock and bilking people who can't afford it out of their money for shows that never quite happen."

Isn't it 35 per the article?? Not sure about state law vs. federal law, though...

I sort of agree that the risk is higher, and not everyone should be allowed to invest.

Damn, I can't invest in Broadway show with those requirements - ha ha 

HogansHero said: "It is well to remember that generalizations produce bad info.

Shows are not one-size-fits-all and neither are capitalizations. In a perfect world, unaccredited investors are inefficient;producers do not want any unaccredited investors. The best way to capitalize a show is with a few (35 would be the upper range) high-6 or 7 figure investors. All of these people are inherently accredited and by a long shot. But there are of course other shows that are unable to make this happen, and seek to find cash wherever they can. Few seasoned producers find this worthwhile but of course there are exceptions. I think this subject is much ado about nothing althugh I have never really understood the logic of the rule."

Are any shows produced with a handful of investors anymore? Maybe Hamilton & Cher Show...

Updated On: 2/4/20 at 10:58 AM

Please remember the advice of Sitting Bull: Keep bow tight. Keep arrow sharp. No put money into show business!