Broadway Investing 101
Everything you need to know about investing in theatre.
Welcome to the World of Broadway Investing
You don't need to have a lot of money - or even spend your own money - to help create a Broadway show.
It's like helping fund a startup: you're part of the team, and when it succeeds, you share in the rewards.
Two Ways You Can Earn
1. Invest Your Own Money
Buy a piece of the show. When the show earns money, you get your share of profits based on your ownership percentage.
Example: Investment units vary by production. Once a show recoups its capitalization, you'll start receiving profit distributions based on your ownership percentage.
2. Raise Money for the Show
You don't have to spend your own money at all. If you help raise capital, you earn carry - a small percentage of the producer's profits - and producer credit.
Example: Connect investors who contribute $100,000 total, and you could earn producer credit plus a percentage of profits without investing a penny yourself.
How Broadway Investing Works
The show needs money.
That money (called the capitalization) covers sets, costumes, rehearsal space, salaries, marketing, and all the other costs associated to get the show to opening night.
The show opens and sells tickets.
Once a show opens, the weekly ticket sales cover running costs to keep the show running. The extra income starts paying investors back.
When investors are fully repaid, that's called recoupment.
From that point on, profits are shared between investors and producers. Investors continue to earn for as long as the show remains open, or anytime the production is licensed (think tours, regional theatre, community theatre, high school productions, etc).
The "1-for-X" System
Sometimes referred to as Bonus Entitlement or Additional Producer's Share, this system determines how much additional credit and profit share you earn when you raise money for a show.
| Term | Meaning | Percentage | Math ExampleBonus Credit (also called Additional Entitlement or Additional Producer's Share) is extra ownership you earn for raising money, on top of any direct investment you make. This gives you a larger share of profits without putting in more of your own money. |
|---|---|---|---|
| 1-for-1 | Best deal | 100% | Raise $100K → Earn $100K in bonus credit |
| 1-for-2 | Great deal | 50% | Raise $100K → Earn $50K in bonus credit |
| 1-for-3 | Good deal | 33% | Raise $100K → Earn $33K in bonus credit |
| 1-for-4 | Standard deal | 25% | Raise $100K → Earn $25K in bonus credit |
| 1-for-5 | Smaller piece | 20% | Raise $100K → Earn $20K in bonus credit |
Key Takeaway: The smaller the number after "for," the more credit and profit share you earn.
Important: Understanding the Risks
Broadway is unpredictable. Some shows soar, others close early. Even the best financial models can't guarantee success.
All theatrical investments carry substantial risk. You could lose some or all of your investment. Past performance is not indicative of future results.
This page is educational only and is not an offer to invest. Always consult with financial and legal advisors before making investment decisions.