June 21, 2016 Darnell Goldson
A Broadway producer and investor in the blockbuster hit “Hamilton” is starting a company to compete in the secondary market. The public relations pitch, “we’re here to help the ‘real fan’ get cheap tickets.” The reality – it is just another way to get into the $6-8 billion secondary market.
Broadway investor Brisa Trinchero has raised over $1.5 million to launch Shoowin, a unique platform, powered by proprietary IP, which enables fans to easily buy, sell, and trade reservations (“options”) to lock in face value tickets to high demand contingent events. The company says the new app is “simultaneously creating affordable access for fans and new revenue streams and data for rights holders.”
What the app does is it allows buyers to reserve tickets to speculative events. Here’s how it works. You purchase a reservation, or “option” for a seat at an event which may or may not occur, like a playoff game, months in advance. As you get closer to the event, perhaps it becomes a hot game, or hit Broadway show (“Hamilton”). So now you have a choice, do you attend the event yourself, or do you sell the reservation. If you decide to sell, you can get whatever price “ShooWin’s marketplace and supply and demand will dictate.” The event promoter gets to sell its tickets in advance, ShooWin makes its money on the reservation fee and whatever other fees it will charge for transactions on its marketplace, and you, the real fan, gets purchase the ticket an Emmy Award winning Broadway producer. If the event does not occur (say the team doesn’t make the playoffs), then you lose all of the money you put up in advance.
Wait, except for the Broadway producer thing, and of course the speculative ticketing, this sounds a lot like what companies like TicketNetwork and StubHub already do.
Just days after watching the New York legislature pass a law adding exorbitant fines and criminalizing reselling activities, pressed by New York attorney general Eric T. Schneiderman, and another “Hamilton” writer and producer Lin-Manuel Miranda, it appears that these Broadway insiders want to have their cake and eat it too.
“This is absolutely outrageous,” said the CEO of an online brokerage firm, who wished to remain anonymous. “This is one step beyond speculative ticketing, this is a gambling app, and a secondary market app all wrapped up in one.”
Another industry insider also lambasted the concept. “The way I understand it, you pay an option fee to buy tickets if your team makes the playoffs. It is speculative ticketing, exactly what the attorney general railed against in his report. I’m shocked that a Broadway producer would be pushing this”, he said, “what’s next, Broadway producers sell spec tickets to shows in the theater district?”
Brokers we spoke to were much more open to the idea. “For me, this is perfect. I get to buy all the tickets I want for more than face value, and sell them for whatever I want? And I can do that legally without paying that high New York licensing fee? Man, I’m buying out the stadium!”
Another New York broker voiced the same sentiments. “We’ve been trying to do the same deal with teams for over 20 years, but I guess I didn’t have the right tool, an Emmy Award. But I’m not mad at her, being able to buy spec tickets legally, I’m definitely in.”
The predictions from most insiders is that if this app comes to market, most of the inventory will be snatched up brokers.
Next: How high society makes a killing off the secondary market while lower income resellers are criminalized.