MoviePass Parent Files To Raise $1.2 Billion To Stay Afloat (variety.com)

An anonymous reader quotes a report from Variety: Helios and Matheson Analytics, the struggling parent company of MoviePass, filed a registration statement with the SEC to raise up to $1.2 billion in equity and debt securities over the next three years. The funding is intended to support the cash-burning operations of MoviePass, as well as the MoviePass Ventures movie investment subsidiary, MoviePass Films and Moviefone, which Helios and Matheson recently acquired from Verizon's Oath.

Of course, whether Helios and Matheson can actually persuade investors to keep pouring money into the venture is unknown. The announcement comes after Helios and Matheson, the New York-based data and analytics company that bought MoviePass in 2017, last month announced a $164 million bond sale to provide working capital for MoviePass.

Comments

Investors?

[DogDude]

What the hell are these investors investing in? This is a company that sells $10 bills for $5. This is one of the stupidest business models I think I've ever seen (and I'm kinda' old).

Re:Investors?

[Presence Eternal]

You gotta help me. I thought I was investing in Groupon.

Re:Investors?

[Riceballsan]

I think they are trying to be like american health care... except for on a service that people barely want and nobody needs that is likely going to be dying on it's own in a few years.

In short their business plan is more or less. First spare no expense, do whatever it takes to become the means people use to go to movies. Get positioned to the point where if a cinema were to say "no we don't take movie pass here", means turning away half or more of their customers. Then use that new leverage to tell the theatres that they need a 75% discount for all of the customers they are bringing in. The theaters can accomplish this and keep their existing profit margins by raising their prices for non movie-pass customers (If they do this moviepass will just raise their fee, but it will be a bigger "savings" because of the new jacked up prices the theaters charge).

I do agree though it's still a stupid ripoff, while they are working to secure theatre rights, less people can really afford to go to the theatres, and more are waiting to see things on netflix etc... to save themselves from leaving their houses and paying ridiculous prices to begin with.

Re:Investors?

[DogDude]

I certainly did not miss it. That's the business I work in. We saw how stupid it was, and just waited for them to die.

Re: Investors?

[Nidi62]

They're owned by an analytics company. Remember the outcry when they said they wanted to start tracking you before and after the movie? That's their profitability, their end game. They want the data of date night. They hope they can then sell that data to theaters, restaurants, bars, etc. Fscebook uses the whole social aspect to bring people in to harvest their data. Moviepass' lure is the cheap movies.

Re: Investors?

[DogDude]

But giving away free movie tickets is an absurdly expensive way to grab this data. People willingly give their data away for free in exchange for an electronic gee gaw. Give people a stupid fucking emoji or gif or something equally as useless, and they can have all of that data for free.

Re:Investors?

[ShanghaiBill]

at least one of their C*O's going to end up in jail.

Why? It is not illegal to take money from foolish investors. If it was, most the financial industry would collapse.

Re: Investors?

[ShanghaiBill]

I just don't see how we can base our entire economy on companies displaying ads and selling data to each other. At the bottom of the pile, doesn't someone need to actually make something for everyone else to market and sell?

Re: Investors?

[c6gunner]

Why? It is not illegal to take money from foolish investors.

Tell that to Charles Ponzi.

Re: Investors?

[Nidi62]

You're right, it's not worth that much This is why they are hemorrhaging money at the rate that they are.

Re: Investors?

[gnick]

At the bottom of the pile, doesn't someone need to actually make something for everyone else to market and sell?

For a date night like one we're discussing tracking, somebody makes drinks, dinner, and a movie and those things are purchased my the daters. Deciding who provides those things could be influenced by ads. There is a bottom here.

Re: Investors?

[nitehawk214]

Ad-based data-collection companies like Google and Facebook go absolutely nuts in the stock market.

Maybe it is because it is hard to estimate what a giant company that lives almost solely on the vague concept of "eyes" is really worth?

Re: Investors?

[gnick]

Speaking personally, ads influence very little of my behaviour ...

You may think that, and you may be right, but everyone thinks that. Some big players are betting big money that you're wrong.

How did it hit $32??

[Anonymous Coward]

Something is very strange about their stock that it randomly goes from about $2/share to $32 a share from Sep 12 to Oct 11 2017 (https://finance.yahoo.com/quote/HMNY). Then it's proceeded to decline since this suspicious bubble up. What drove it up in the first place??

Re:How did it hit $32??

[nitehawk214]

So their stock price went through the roof when their revenue cut by more than half?

That sounds almost like an orchestrated pump and dump scheme. I'm sure the SEC is keeping an eye on how many C-level execs cashed out.

Well, at least

[Bruce Perens]

These investors are smarter than the ones who shorted Tesla. That's all I can say :-)

"invest in cash-burning operations"!?

[kiviQr]

How many MBAs you need to read and undersdand "invest ... in cash-burning operations"?

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Cuecat of Movies

[QuadEddie]

This is the cuecat of movie watching. How much can you give away hoping to become the monopoly while theaters just wait for you to die?