Phoenix LXXII: Send in the Clowns
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02-27-2013, 12:48 PM
Join Date: Feb 2010
Originally Posted by
...It's a lot to ask investors to give up a 25% stake in an overpriced
and money-losing asset when you have to pay the freight.
It sure is, but remember too its just a "rumour". But if true, then yes, absolutely a ridiculous % for an architect to be asking without much if anything in the purchase & project himself beyond concept & sweat equity. I suppose the justification for such might be that he was the one who negotiated the deal with Glendale and thereby makes some sort of tangential claim of propriety in reeling in $300M+ in funding but still. I would have though something more in line being 10% with some investment himself, appointment to position of President & designate with the Board of Governors, reasonable remuneration performance based & so on.
25%, or 20% as is common in the movie industry whereby an 'A' lister, and theres very very very few of those will waive their up-front fee and instead receive whats called a Cash Break; 20%, a combination of the Net & Gross Points, the studios adding that 20% to Production Costs without paying it up-front. Paid on the back-end through theatre ticket sales, DVD, commercial sales & so on. The star of the movie in effect an equity holder. Gretzky worked a similar play with Phoenix, a "name", supposed drawing power with a miniscule % in comparison to GJ's purported 25% stake and look how that worked out? Just where Greg Jamison would get off asking for a quarter of the pie I have no idea. Money's dried up, finding private placements from hedge funders or wherever for sports & entertainment properties beyond competitive; up-front costs cut to the bone with demands of serious majority positioning if you ever expect to secure seed money. Beyond difficult if the property, be it a hockey franchise or a movie might be a dog that dont hunt.
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