Most theatre histories focus on individuals – larger-than-life characters who shaped the art form over the centuries: Richard D’Oyly Carte, Binkie Beaumont, Cameron Mackintosh. But, when the history of 21st-century British commercial theatre is written, the key protagonist could well be the unglamourous figure of institutional finance.
Ambassador Theatre Group’s rise is often represented as the story of two individuals who built a global empire from scratch. But it could equally be seen as symbolic of the City’s increasing grip on commercial theatre.
As well as ATG, European theatre operator Stage Entertainment is private equity-owned, as is Digital Theatre. Likewise, the stage school business Stagecoach, which Trafalgar Entertainment has just acquired.
Mainstream theatre in the UK has always valued commercial acumen, but it has often been focused on the cult of the individual – an impresario who can ‘smell a hit’. This is not how institutional finance works: theatre and the City have sometimes felt like awkward bedfellows.
Andrew Lloyd Webber, one of the first theatre figures to embrace private equity funding when he teamed up with Bridgepoint to buy Stoll Moss Theatres in 2000, has since recanted. He told the Financial Times earlier this year: “The City doesn’t understand theatre. Venture capitalists see these theatres with 67% occupancy and reckon it must be possible to get them up to 81%.”
This same problem is alluded to by Rosemary Squire in the Big Interview this week, as she discusses how she and Howard Panter plan to build up their next venture post-ATG. Conversely, she highlights the ‘vertically integrated’ business model that private equity investment has enabled as a way of mitigating theatre’s inherent risk.
“We have a vision for how you make theatre really commercially sound. The other pieces give you the capital to be able to produce.”
That approach has not always been popular: a rival producer once attacked ATG’s “Easyjet/Ryanair mentality”, and the approach demanded of theatre operators by private equity partners has often seemed to be about boosting profit margins by cutting costs, not enabling risk.
But it would be unfair to paint the finance sector’s impact on British theatre as wholly negative. Commercial theatre’s biggest artistic success of the last decade – Sonia Friedman – found a nurturing home in ATG’s private equity-financed stable. Would her impressive output have hit such heights without it?