TodayTix Makes Inroads Into Broadway’s Ticketing Business
By MICHAEL PAULSONFEB. 23, 2016
A theater industry start-up that is trying to corner a share of the byzantine Broadway ticketing business has raised nearly $16 million in venture capital and has expanded beyond New York to four other American cities and to London.
TodayTix, which 26 months ago introduced a mobile app for selling discounted and full-price last-minute tickets, has already become a visible presence on Broadway, thanks to its red-jacketed agents (they wear red shirts in warmer weather) who deliver tickets outside theater doors. The company has made inroads into a ticketing world largely controlled by the theater owners themselves — TodayTix says it is currently selling 4 percent of all tickets to Broadway shows— and the company’s executives believe that their emphasis on mobile technology and clarity in pricing will lure younger consumers.
“We are focused on attracting a millennial audience that might find theater inaccessible,” said Brian M. Fenty, one of the company’s founders. “People think the theater industry is very small and cottage, but it’s a large business that we thought was ripe for innovation.”
Mr. Fenty and the TodayTix co-founder Merritt Baer, who met as children at the French Woods performing arts camp, said that they have completed a $9 million financing round, led by Tylt Ventures and Walden Venture Capital, bringing the overall financing for their company to $15.68 million. TodayTix has 40 employees and is currently selling theater tickets in Chicago, Los Angeles, San Francisco and Washington, as well as in New York and London.
TodayTix faces a variety of competitors as it continues to expand to other cities. And its innovations can be mimicked — it was the first company to offer a mobile lottery for deeply discounted last-minute tickets, but now such lotteries are widespread on Broadway.
The tight-knit world of Broadway theater owners has not welcomed TodayTix. The company has been unable to negotiate agreements to electronically access inventory at Broadway theaters, so users of the TodayTix app choose theater sections and ticket prices, but not specific seats; TodayTix then sends couriers to the theater box offices to buy the tickets in person.
In New York, the biggest players are the theater owners themselves: the Shubert Organization owns Telecharge and the Nederlander Organization has a long-term agreement with Ticketmaster. Asked about TodayTix, a spokesman for the Shubert Organization, which is the largest owner of Broadway theaters, declined to comment.
Broadway has been booming in recent years — the last season, which ended in May, saw a record audience of 13 million people, and the 40 Broadway theaters grossed $1.365 billion. But to consumers, buying theater tickets can seem complex, with a dizzying array of websites offering discounts to many shows, and heavily marked-up tickets for sold-out hits being resold on the secondary market.
Broadway has lagged behind other parts of the entertainment business in its embrace of technology such as mobile ticketing, but practices have been gradually changing. About half of all Broadway tickets are now purchased over the Internet, according to a new study of audience demographics by the Broadway League, and about 37 percent of Broadway tickets are purchased less than a week in advance. About 11 percent of Broadway tickets are sold at the TKTS booths.
Beyond Broadway, TodayTix has had more success within the industry. The company said it has agreements with most of the major New York nonprofit theaters, including the Public Theater, as well as other performing arts institutions, including the Metropolitan Opera and the Brooklyn Academy of Music. Outside New York, the company has partnerships with 157 theaters, so at many of those theaters TodayTix users can choose specific seats.
TodayTix sells tickets only within a week of a performance date. It charges a $5 fee per ticket on those purchased in the United States, and another $5 per ticket if they are hand delivered to customers at the theater; for tickets purchased at theaters that partner with TodayTix, the company charges the theaters a commission of 5 percent plus credit card fees, and the tickets can be picked up at will-call.
Among the new investors in TodayTix are Robert Fox, a British theater producer; Jeremy Zimmer, the chief executive of United Talent Agency; and Andrew Lippa, a Tony-nominated composer. The company had previously lined up financial support from Danny Meyer, the restaurateur, as well as from several venture capital firms.
“If you can use technology to democratize theater a little bit, I think that’s a great thing,” Mr. Zimmer said. Mr. Fox said he was impressed by the “very easy-to-use app,” and that “the more outlets there are for people to buy tickets, the better.”
Ken Davenport, a theater producer who is not affiliated with TodayTix and who writes often about the need for more innovation in the theater business, said the company had sold a significant number of tickets to his most recent Broadway show, a revival of “Spring Awakening.”
“They’ve been able to do something mobile, and to sell at discount,” Mr. Davenport said. “It was very successful for ‘Spring’ and for other shows I’ve done.”