ELLISON RAINS (ERE)
Ellison Rains Enterprises Inc. (ERE) is a Vancouver-based start-up with the intent of becoming an integrated comedy and entertainment provider and industry leader across both live stages and digital platforms.
Through comedy club development and acquisitions, venue partnerships, event promotions, and content licensing and production agreements, ERE will become a leading source of comedy -- on stage, on screen, everywhere.
ERE has evaluated several comedy clubs in Canada and the US as possible partners, franchises, or acquisition targets and intends to develop a network of up to 60 comedy clubs to become the largest comedy club chain in North America within the next five years.ERE plans to build an integrated entertainment company focused on promoting comedy events, comedy tours, and festivals; as well as to produce and distribute comedy content across multiple platforms.ERE also intends to develop co-branding and sponsorship opportunities to increase brand awareness, enhance marketing, and increase attendance and spend per attendee as well as explore expansion outside of North America as comedy entertainment is appreciated worldwide.
Comedy club revenues are generated by ticket sales and food and beverage sales while comedy events are primarily from ticket sales. The development of a digital content library of comedy shows will enhance ERE’s brand and reputation as well as generate recurring revenue in the form of licensing fees from television broadcasters, streaming services, and satellite radio outlets. The addition of a mobile application (which would offer ticket promotions, merchandise, live stream comedy shows and other proprietary comedy content) is another revenue opportunity for ERE.
Clubs in larger cities offer up to eight shows per week while clubs in smaller cities will offer three to five shows per week. Clubs typically seat between 180 and 300 people, offering an up close and engaging entertainment experience. Clubs are liquor licensed establishments and offer snacks and convenient food choices with some having a full dinner/show option.A well-run club can generate $10 per patron for ticket sales and $13 per patron on food and beverage, on average, and can attract between 35,000 and 50,000 patrons per year.
Outside of the clubs, through venue partnerships and rentals, ERE intends to promote comedy shows, tours, and festivals featuring well know comedians across North America.
Consumers have become increasingly enamored by the ability to quickly and easily access high-quality entertainment, including recorded stand-up comedy. The increasing popularity of digital content brings new opportunity for the traditional comedy club business. Having a baseline of clubs and events provides ERE with access to a broad range of comedic talent and a unique platform to develop digital content which can be shared globally.
ERE will be a producer of comedy content for distribution to traditional, satellite, and internet radio, television, the web, and streaming services; as well as develop their own App to offer ticket sales, promotions to subscribers, and premium content.
Total global media and entertainment revenues were $632 B in 2015.North American Theatre Box Office revenues were $11.4 B; indicating that the market for out of home entertainment is substantial.The US Live Comedy revenues in 2014 were estimated to be $300 M.Despite the increasing competition of online media content, the number of people who visited comedy clubs in the United States steadily increased from 14.6 million in spring 2008 to 17.6 million in spring 2016. These factors indicate that there is a large and growing market for live comedy entertainment in North America.
As examples of how the digital market for streaming services are developing (including comedy specials), Netflix has announced a $6 B content budget and Apple has announced a $1 B content budget for video. Deloitte’s 2017 Media and Entertainment Industry Outlook estimates on-demand video viewers in the US will grow from 181 million in 2015 to 209 million by 2021.
Minimum current raise: $250,000
Maximum current raise: $500,000
Pre-money valuation: $2.9 M
Offering type: Common Shares with Voting Trust Agreement
Price per unit: $0.50
ERE plans to grow dramatically over the next several years and will be reinvesting its operating cash flow in to the continued growth of the company. Once operations have reached an optimal level, management will consider the best exit strategy for its shareholders. This may include a strategic merger or acquisition, or an initial public offering.