The Theatre Fund is an opportunity for new investors to participate in a business sector the performance of which has improved over the last eight years despite the recession, and which does not depend on government support: West End theatre production.

West End theatre attendance and revenues have had over seven years of consistent growth despite the negative economic backdrop, with 2009 revenues exceeding £500m for the first time and attendances achieving a record 14.26 million. Total revenue for plays was up 10% through the end of 2010 compared to 2009 (Society of London Theatres (“SOLT”) Press Release 27/1//2011). Despite hard economic times in the UK, 2010 proved to be another successful year for London Theatre. More than 14 million theatregoers attended a performance in one of London’s major venues last year. This impressive number, though down 0.79% on 2009, led to a record year at the box office, with theatres taking £512,331,808 (SOLT Box Office Data report, 27/1/2011).

Traditionally most West End plays and musicals are financed through informal networks of private investors, known as “angels”, who are invited to back individual productions with the profit or loss on that investment being solely dependent on the success or failure of a particular show.

The Theatre Fund’s innovative structure, in contrast with the traditional structure:

  • allows for the diversification of investment risk across a portfolio of Productions selected by experienced professionals (TTF will invest in 4 to 12 individual Production Companies, each established for a separate individual Production, TTF will not invest more than 50% of funds raised in any single Production, nor more than 50% of the working capital requirement of any one Production);

  • provides an enhanced percentage financial participation for investors (including a 70% share of profits compared with the traditional 60%, and participation in pre and post-recoupment Producer Royalties traditionally retained by the producer); and,

  • accords qualifying investors significant tax advantages not customarily available to theatre investors, under the Enterprise Investment Scheme (“EIS”) including up-front income tax relief of 30% and profits free of capital gains or income tax.

Enhanced Profit Share

Traditionally the theatre investment model provides that post-recoupment profits from a production go 60% to the angel investors and 40% to the producer. In addition the producer receives weekly Producer Royalties from the production.

In contrast, TTF Investors will benefit from an enhanced return on each Production of 70% of post-recoupment profits, together with a 70% share of weekly Producer Royalties. The remaining 30% will be paid to the Adviser. This enhanced Investor participation recognises the fact that TTF enables the Adviser to increase the number of productions with which it can be involved, provides certainty of prompt funding and consequently should attract an improved flow of new opportunities.

Tax Benefits

EIS relief and tax-benefits to individual qualifying Investors potentially available under TTF’s structure include: (i) income tax relief equal to 30% of the amount invested; (ii) any profits from the TTF investment being distributed to Investors free of capital gains or income tax; and (iii) deferral of capital gains earned previously from other sources and invested into TTF.

If there is no return from a particular Production Company, subject to an Investor having sufficient income in the year in which the loss arises, an amount equal to their investment in the Production Company less EIS tax relief received can be offset against such income. For an Investor who is a 50% tax payer, the maximum cash loss is accordingly 35% of such investment (upon application of the 30% initial income tax relief and 50% loss relief on the remaining 70%).

Each Investor must confirm availability and applicability of tax reliefs and other tax implications to their individual circumstances with their own tax adviser.


Act Productions Limited will serve as adviser to The Theatre Fund. Act is one of the West End’s leading theatre producers with over 15 years of first rate West End productions across a comprehensive range of genres.

Act Productions’ position in the market means that it is aware of a high proportion of the potential productions at an early stage in their development. Act will not be permitted to invest for its own account in eligible productions unless The Theatre Fund has been given a similar opportunity to invest.

Financial Controls

The activity of TTF will be under the control of the Fund Manager, working closely with the Adviser and the Oversight Committee, whose role will be to ensure that productions introduced to them by the Adviser meet TTF’s established criteria.

Theatre accounting is necessarily a model of transparency and carefully monitored by a number of parties and their representatives, as each production has a number of independent financial revenue participants (including co-investors, co-producers, authors, rights licensees, director, creative team, and theatre owners) each of whom may have a financial interest in the financial performance of the production, and therefore routinely depend on accurate and timely accounting. Highly detailed budgeting is undertaken before the commencement of any production and monitored closely against weekly accounts. At the conclusion of a production’s run accounts are reviewed and certified by independent chartered accountants, and will be available to TTF Investors and their representatives on request.

Other Benefits

Investors in The Theatre Fund will receive additional theatre privileges, subject to availability, including:

  • Complimentary tickets to opening night or preview performances.

  • Invitations to meet the cast and company at opening night parties.

  • Invitations to open dress rehearsals.

  • Access to VIP house seats across the West End.

  • The opportunity to organise special theatre evenings for friends, colleagues, or clients.

  • Industry insider status, recommendations, and information.

  • The opportunity to invest in all further theatre production opportunities to which The Adviser is party but which are not eligible for TTF.

Issue Statistics and Expected Timetable

Expected life of the investment: 3½ to 5 years.
Minimum investment: £25,000.
Maximum EIS qualifying investment: £500,000.
Closing Date: earlier of Full Subscription or 31 March 2012 (or such later date as the Fund Manager may determine).
Maximum amount to be raised: £5 million (unless the Offer is increased by the Fund Manager in their absolute discretion up to £10 million).
Minimum amount to be raised: £1 million (unless the minimum amount is reduced by the Fund Manager in its absolute discretion).
Initial Fee: An initial fee of £40,000 plus up to a maximum of 4% of each Subscription will be charged by the Fund Manager to the Production Companies, out of which the costs of establishing The Theatre Fund will be paid.
Management fee: Annual fee fixed at 2.5% of Funds raised will be charged by the Fund Manager to the Production Companies, with no participation in Fund performance or Investor gains. From such 2.5% annual management fee, 1.5% will be paid by the Fund Manager to the Adviser in consideration of the services of managing TTF’s investments in the Production Companies.
Adviser participation: After a Production Company has recouped its investment in a particular Production, the Adviser will receive 30% (compared to the industry standard 40%) of any subsequent post recoupment profits due to such Production Company from that Production. The Adviser shall also receive 30% of any Producer Royalties paid to a Production Company from a Production (unlike standard theatre investors the TTF Investors will benefit from a retained 70% share of the pre- and post-recoupment Producer Royalties where and to the extent due to the Production Company, as further set out on page 20).
EIS status: The Fund is an unapproved fund for the purposes of the Enterprise Investment Scheme. Tax reliefs are granted to Investors after the date on which the investments in underlying Production Companies are made and EIS status is confirmed. The Fund Manager and the Adviser will invest as soon as commercially suitable Productions are identified or developed, and expect to be able to fully invest the Fund within the second tax year following the Closing Date or sooner.