Dragons BAFFLED by Impresario’s Complex Finance Structure | Dragons’ Den

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Independent theatre producer Josephine Buchan gives a brief pitch explaining why now's the time for a Dusty Springfield musical. Josephine seeks investment of £250,000 in return for a 25% equity stake but will 80% of 25% of net profit be enough?

An international sensation, Dragon's Den features entrepreneurs pitching for investment in the Den from our Dragons, five venture capitalists willing to invest their own money in exchange for equity.

#DragonsDen #DustySpringfield #WestEnd

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"You'll get 80% of 25% ... of 30%"

Voicist

The director said the most honest thing by accident. A huge success means they didn’t lose money. That is hardly an exciting investment opportunity.

jakelaughton

Watching dragon den clips is now a part of my daily routine. I can't get enough of it

Slimblue

I invested in a West End musical a few years ago, and despite rave reviews, I lost the entire sum.

The problem is so many of these creative types are too focused on reviews and putting on a good show. Once it's funded, investor returns are a mere after thought. A lot of theatre productions seem content to make just enough to keep the production running it's full course, and see breakeven as a success.

When you run the numbers as an investor, it looks attractive even acknowledging the relatively high risk.
But what you don't take into account is that they often have enormous blocks of heavily discounted or complimentary tickets, some of it contractual with the theatre, just to keep the theatre full each night.
These are sold by affiliates and via promotions, and heavily erodes the projected sales figures. I'll never invest in theatre again, , I know that much.

carpii

Can’t believe that she doesn’t know how much a theatre would charge her to host her show! Sure that’s the equivalent of someone who open a shop and having to pay rent every month. That would be your number one expenditure to take on consideration!

ALEXMGFASHION

These Dragons are so short sighted. I've just invested in the stage production of Dance of The Goblins and the playwright assures me that she has a natural ability to organise and keep costs down.

easycoding

Once again, Theo saved his kids' inheritance

drillcream

The split with the Dragons is 75/25, that leaves 25% for the Dragons.

Then the Dragons get 80% of the profits on their 25%.

0.25 x 0.80 = 0.2 or 20%

So the Dragons invest 25% of the money but only get 20% of the profits?

For the Dragon's to recoup their money, the show would have to sell £1, 250, 000 worth of tickets (£250, 000/0.2) @ £22.80 ea.

£1, 250, 000/ £22.80 = 54824 tickets, which is approx 55 shows fully sold out in a 1000 person theatre.

benbooth

Her voice had overtones of an angry cat being run through a bandsaw 🐈

relaxationmedia

I love that when the woman was singing, Peter had a look on his face like...”I wonder what Mrs Jones is making for dinner.” 🤔

Bulskee

If I wasn't already out before that guy bulged his eyes up the stairs, I'm out now.

liammccarthy

the director gets the Guinness record for quickest dragon alienation

ermitikos

That was like an X factor audition fail

ThePrimeMinisterOfTheBlock

Anyone else skip the musical cringe? 😬

royboy

The guy coming up the stairs is like when you’ve finally got to the top of the club queue and your drunk mate starts talking to the bouncers - dreading what comes out his mouth next.

demandtalent