Second Act Theatrical Interview With Helen Little

Episode Transcript

Speaker 1 (00:00):
Today we welcome Adam Heinman, managing director of Second Act
Theatrical Capital, to the building Blackbiz Podcast.

Speaker 2 (00:08):
Welcome to the show. Thank you so much, it's a pleasure.

Speaker 1 (00:12):
It is so good to have you. I'm Helen Little
and I'm so glad to be hosting today and having
this conversation with you because we can learn a lot
from you.

Speaker 2 (00:20):
Today.

Speaker 1 (00:20):
I'm realizing that not only are you working with Second
Act Theatrical Capital, but you've got a long list of
theater credits that also include being a Tony Award winning
producer as well as a performer.

Speaker 2 (00:31):
Director and activists. Perfect.

Speaker 1 (00:34):
I love this, So tell us about Second Act Theatrical
Capital first.

Speaker 2 (00:40):
Sure, so, as we call it to ATC okay is
a labor of love from a cohort of eight BIPOC
producers and we really came together in the pandemic. Of course,
every industry, I think was having a reckoning for various moments.

(01:01):
Our industry was also sidelined because you know, performing arts,
the convening that is crucial and essential to making theater
was deemed inessential. So all of these folks who were
always fast paced working on a million projects had the

(01:22):
space and time to look inward. That created a real
threshold of analysis. Myself and some of my colleagues you know,
would work together, we would see ourselves, but too often
we were the one chocolate drop in the room, in

(01:44):
a marketing meeting, in a board room, navigating fields where
there's a lot of urgency and a lot of antiquated practices.
So when we were in this racial reckoning, we came
together really to hold space, you know, and find affinity.

(02:08):
But as producers, we quickly turned from conversations of care
to action and we asked ourselves how do we create
change and innovation in our lane? And for me, that
very much was about how do we create pathways for

(02:29):
economic justice? How do we create more access and representation
behind the scenes at the decision making levels. So that
had everything to do about our investing pipelines. So second act,
theatrical Capital is a brand new model for people to
participate in producing and investing at the commercial broadway level.

Speaker 1 (02:53):
So what is your actual role now that it's gone
from a bunch of people sitting around thinking this would
be a great idea to taking action to actually having
a position within this organization. So what's your specific role there?

Speaker 2 (03:07):
Yeah, Well, it first started with about three years of
research and development and we were all kind of participating
in a labor of love. We got a lot of
support from some advocates in the industry, and then our
research led us into other pockets where some folks in

(03:31):
the security laws arena attorneys started taking note of what
we were doing because we were disrupting these models that
haven't been updated in decades and such. So we ended
up getting some really remarkable pro bona support from some
amazing allies in that law field, and that allowed us

(03:52):
to organize and structure this initiative into an actual business,
into an organization that creates a subsidiary that houses people
to come in and create collective economic pools of investment together.
So my position as manning managing director might be most

(04:16):
closely akin to the managing director of a venture fund
or a company that is bringing in LPs or stakeholders
to participate in a specific market. Our market is Broadway.
It's an untapped industry that's often very closed and has
a lot of barriers to entry. So that's why I

(04:37):
think it's exciting.

Speaker 1 (04:38):
That is exciting and fascinating, And you know, did you
foresee that this is where your career was going. Where
did where did your career start? And how did you
manage to get where you are now? I mean, did
you have that vision or did you kind of fall
into it?

Speaker 2 (04:57):
I love hell and we're going to go back. Okay, welcome.
So I had a career as many people in the arts.
I call it like a portfolio career. Okay. My curiosities
led me into different opportunities, but my passions and talent
rooted me in this form. I. You know, many folks

(05:21):
who enter the field as performers like I did, came
from conservatory training, so they were just studying in college,
you know, their acting training, or their vocal performance, or
their dance. I went to a liberal arts school, so
how I was involved with the arts was very much
about creating my own path. I was running our student

(05:45):
dance company, I was managing the student theater company. We
were organizing rehearsal spaces. What I didn't know was while
I was honing my craft as a performer, I was
also taking on response abilities of facilitation and producing. So
that created a type of propensity to be involved with

(06:08):
all of these different pain points in the collaboration of
theater making, which I think set me apart a little
bit different than the folks I was in dressing rooms
with and dancing on Broadway and moving from show to
show because I was curious, because I was asking questions
about the models that we were in, because I was

(06:30):
wondering about contracts and why things were being offered and
who knew what. And when I made my Broadway debut,
I thought I was going to be an expert in
all things Broadway right away, but that was not the case.
There's a lot of there's a lack of transparency. And
then I started realizing that doesn't just extend to the

(06:52):
folks you see on stage, it's also some of the creatives.
I remember having a conversation with my Broadway director, and
that person didn't exactly know the profit participation for this
Broadway enterprise. They didn't exactly know who got what, and
what the split is when you recoup investment and how
that waterfall is shared. So then my curiosities just led

(07:17):
me into networking and wanting to kind of get a
you know, street education on it, because this type of
work is passed on in a kind of mentorship way.
There's no real programs and degrees you can get in
in theater producing and management. There are only a couple

(07:37):
in the country, so I started reaching out and networking,
and then a lot of my teaching artist work led
me into other areas of collaboration. So I started saying, hey,
I might not be a Broadway producer right now, but

(07:59):
I can help my playwright friend structure or reading. I
can get hands on experiences setting up small projects. And
I allowed my you know, values to bring me into
mission alignment and very quickly. Because it's a small industry,

(08:21):
you start to see who you have synergy with and
who you want to continue to work with. And I
would say the big shift came for me personally. I
don't think it's it's unsimilar to folks stepping into the
commercial side of Broadway, but fundraising is a big catalyst

(08:45):
to how you can navigate and maybe level up. So
once I started fundraising and doing that successfully, you know,
they're like sharks in the water. They're like, oh, you
can raise money, right, So you get opportunities and that's
when discernment became important for me.

Speaker 1 (09:02):
I heard.

Speaker 2 (09:05):
And really being methodical about where I'm an advocate, what art,
what project is right for me as a producer to
take on. There's a ton of great, exciting work being done,
great art, but not every project is right for you.
So that's when I started making clear decisions about how

(09:30):
to navigate the opportunities that were coming fast and quick.
So that was kind of the on ramp into producing
from a career for many years as a performer and
teaching artist.

Speaker 1 (09:42):
So you are telling such an amazing story. I mean,
it's your story, but you know, I'm sitting here like
kind of hanging on every word. And obviously storytelling is
a big part of Broadway and you've been a part
of some incredible stories, worked on shows that a diverse
and storytellers, audiences and settings. What made you choose to

(10:05):
work with the shows and the stories that you work with?
That's a great You talked about discernment.

Speaker 2 (10:12):
Yeah, I think it is about asking yourself about your why. Okay, right,
why am I the right person for this opportunity? It
looked very different when I was a performer, right, as
a black man, as a person of color. Right, when

(10:35):
you are on that other side of the commodification, it's
limited in terms of what opportunities you get, right, Yes,
So I had to figure out, Okay, this is my
brand as a performer, this is how I'm perceived on stage.
So that means I am only able to audition for

(10:56):
these types of roles that are outside of my control
on what I can even do as a producer, I'm
able to say, what do I believe in? How can
I feel the gap for representation? How can my involvement,
my support, my professional work actually realize and create something

(11:22):
that I want to see in the world instead of
waiting for an opportunity be created for me. So I
sometimes think about that in my discernment process. How do
I not repeat myself? I don't think for me, redundancy
should be a part of my career. If I am
holding myself to accountability of excellence, that means the project

(11:46):
I take should be for that purpose and for that moment.
And then there's a new opportunity, maybe a new story,
a new community to highlight.

Speaker 1 (11:58):
So you know, you were talking about the fundraising aspect
of things, and it got my wheel saying, well, how
does this work? How does investing in second act theatrical
capital actually work? Like? Do you need to be a
banker or an investor? Can I give you a couple
of dollars right now? Do I need to be an
allc Why does it all work when you're putting money
towards a show or production.

Speaker 2 (12:20):
Yeah, I'm going to try to do my best, okay,
to synthesize a very complicated kind of archaic system. Okay,
it shouldn't have to be so convoluted, but this is
part of my mission and my platform to provide transparency

(12:41):
for something that is actually wide open. The first analogy
I'll share is that Broadways kind of similar to maybe
the hospitality or the restaurant industry. You can open a
restaurant if you are a mission awarded CIA trained chef. Right,

(13:03):
that's going to give you in premature, that's going to
allow you to have access and a point of view,
and you get investors to believe in this mission and
you have a whole plan. You can also call up
a franchise of a chain that you believe in, pivot

(13:26):
from a different industry, get some dollars together and open
a restaurant. Here in New York City. There there's a
wild West kind of similarity I think on Broadway, where
there's no actual like criteria for you to participate as

(13:49):
a producer or an investor. It is about the relationships
and how you're navigating your experience. Right. So how Broadway
in the commercial aspect is structured is each show is
like its own venture, its own startup. A producer will

(14:10):
option the rights to a show that individual ip which
is the script or the musical from those writers, and
that producer will set up a new business an LLC
where they're the managing member. They're structured like the CEO
of this new startup and under that, in order to

(14:34):
capitalize the show and get it to its production phase,
you are going to bring on investors investors. Currently, because
of this regulation and the structure of the LLC, this
is a private security. So that means the subscription documents

(14:56):
for investors are being offered through Regulation D. That is
the number one barrier to entry. And for those of
you that don't know, Regulation D through the Securities Exchange
Commission SEC is a type of offering an investment that's

(15:16):
only allowed to be offered to a quote unquote accredited investor,
someone who has above one million dollars in assets or well,
or who makes over two hundred thousand dollars a year
in their tax returns. Okay, so that's a barrier to entry, right,

(15:39):
it's a it's a regulation. D is a very you know,
old system kind of inherited from the Robber Baron situation
back in the day, where it's like all these enterprises
are taking money from people who can't afford to lose
the money. Right, So this idea of an accredited investor is, Okay,

(16:00):
you're only allowed to offer this risky investment. Right. Broadway
is a different investing class, different opportunity, high risk, high reward. Right,
so you can only offer this thing to people who
have enough money to lose it. However, that also creates
what we realize now in the industry, or what we

(16:22):
should understand, is that that's creating a lot of exclusion.
That's creating a lot of Also, that exclusion creates silos.
Those silos create monotony, it creates a lack of diversity. Right.

(16:42):
So if the people who are able to invest have
to meet certain criteria and are only being offered this
through direct relationship right, private offerings, that means the people
in power are going to the people that they know
with money. These are the same people. Broadway is a

(17:04):
multi billion dollar industry year in and year out, and
it is funded by only hundreds of investors. That's crazy.
I'm talking only hundreds of investors that are operating in
this market that year in and year out you might
look up articles or something on Playbill or Deadline Othello

(17:27):
on Broadway with Denzel Washington set a new record in
box office sales. Right, the folks who are actually the stakeholders,
it's a very small community. So that is the traditional structure.
You have to be a high net worth individual and
you have to write a high check so that it
means that minimum investments on Broadway are often twenty five

(17:52):
thousand dollars or fifty thousand dollars. Okay, that's another barrier
to entry obviously. So that's the traditional model, and you
can get that from someone who is a banker, someone
who has that net worth, right, but also people invest
who are dentists, who are business owners, who come from

(18:13):
various access points. The biggest thing is whether you have
the connection to one of these producers. What the industry
standard Group is doing, and through our initiative and subsidiary
second act, Theatrical Capital is that for the first time,

(18:33):
through our work and our research and development and our
experts and security laws who have been supporting us. We've
utilized a different regulation with the SEC to open up
investment at a different threshold, and it's for the first
time open to anyone. You don't have to be an
incredit investor with that's a million dollars of net worth

(18:55):
And because of that, because the idea is about how
we broad in our stakeholder pool so that the people
who are green lighting Broadway shows look like our society,
so that the work starts to actually be in relationship
to the stories and narratives that mean something to us.

(19:17):
We're also bringing down our minimum investment. I talked about
that twenty five thousand dollars fifty thousand dollars number for
second act theatrical capital to be a part of this
model of investing. Our minimum is five hundred dollars. That's crazy.
We wanted to talk about. We wanted to land at
a number, and of course you can. You can invest

(19:39):
a lot more because it's about having a pro rada
equity stake, right, so it's proportional to the amount you've invested.
But we thought about a minimum investment right as the
number that demands seriousness. Right, five hundred dollars is an
amount that is a serious amount of money for the

(20:01):
average person, but it doesn't remove any professional from being involved.
I think about this as you know, a dream of
mine is kind of thinking about you know, how does
every person who works and makes their living on Broadway
feel like they're also a stakeholder. I know plenty of

(20:21):
friends who work at big companies Disney and Google, and
they believe in their organization, their corporation, even the labor
that they're doing every week from their paycheck, they're putting
in investment into that stock. They're seeing where their money
is going because they're on the ground floor. Broadway doesn't

(20:41):
have that. This is the first time something very similar
can happen for all these different stakeholders. Whether you're a
stage hand, a stage manager, or even a patron of
the arts. You take your family to see a Broadway
show twice a year, right, you believe in it. This
is an opportunity for you to also be at the
decision making table.

Speaker 1 (21:02):
Have you been able to bring shows to the stage
that might not have gotten the opportunity because the same old,
same old people were like, I don't know about that,
because I don't understand that community.

Speaker 2 (21:13):
Yeah, yeah, yeah, So I think all of us, all
of us co founders have had that opportunity at a
various level in our proprietary shows. Because we're launching right now,
we have all of this excitement and potential to do
exactly what you're what you're talking about, bringing more folks together,
bringing a diversified and wide investor base that we can

(21:35):
bring internally. This is our market research. This is what
our investors want to see on the stage. This is
what they believe in. This is the show that they're
going to tell their friends about. That's power, that's people power.
That is that's a shift in how we tell stories
with a major cultural form like Broadway, that is disruptive. Right.

Speaker 1 (21:55):
Yes, So now that the wider swath of the population
is attending shows, because I think report from Broadway League
show that audiences are more diverse than ever, more Black, Indigenous,
and people of color are attending shows, is there an
opportunity to, I guess, make it affordable for more people

(22:18):
of these communities to come and see and bring their
families because you know, actually I just.

Speaker 2 (22:23):
Priced out some tickets.

Speaker 1 (22:24):
That's become our Christmas present, uh to a show?

Speaker 2 (22:27):
That we want to go.

Speaker 1 (22:28):
And it's like if you're taking a family and you
do dinner, and for tickets and transportation, you're looking at
one thousand dollars, which is twice of what you said
was a serious amount of money. Do you think that
that's something that will also not to take away anything
from paying the people who are doing this. I don't

(22:48):
want to. I don't want to see that. But creating
something where it is more accessible to people of different
income levels.

Speaker 2 (22:55):
You're on the money. I think this kind of I
think that conversation is all about sustainability, okay, right, and
equipping people with the right consumer knowledge. Right. I don't
think in any you know, natural market or industry, we're

(23:19):
really going to remove the natural realities and influence of
supply demand. On Broadway, there's always going to be the
dynamic pricing that happens with the busiest moments, right Christmas, right,
like holidays. You've got a lot of tourists coming into
New York in general. Right, ticket sales are naturally going

(23:41):
to like reflect that supply and demand. However, there's seasonality
on Broadway. If we're building sustainable models that can create
ticket diversity across the season and have a really robust
plan of transparency, communication, again, consumer awareness. We can inform

(24:08):
our audiences to say, when is the time that's affordable
for you to come see the show? When can we
guarantee the different access points right for you to be
able to procure tickets for this? You know, the art
should be a right for this field and form. So

(24:29):
it's about transparency, awareness and communication right sharing people that
and equipping people with a plan on how to buy
tickets at an affordable level that's right for them, instead
of oftentimes the scarcity mindset, which has people marketing only

(24:55):
to people's fear and desires of being like by now
there's or or miss out and trying to get people
to in fear purchase a ticket that's more affordable or
more expensive than they can afford. It's actually saying, hey,
how about we provide the transparency and show people how

(25:17):
they can participate in this market sustainably over a long time,
because the sustainability will sort of the feel long term.
It's not about having one person spend all this money
having a subpar experience because it doesn't feel worth the
investment and never coming back. I'd rather have someone spend

(25:43):
seventy five dollars more often on their Broadway experience than
feeling urgency and pressure to spend three hundred dollars on
a ticket because they feel like they're missing out.

Speaker 1 (25:59):
Where would you like to see second act theatrical capital,
Let's say in a year and then five years.

Speaker 2 (26:06):
Okay, well, in a year. We are strategically building to
be able to be placed, as you know, producers in
a couple shows where our community can diversify their investment
across that season, right. I think that's the number one

(26:28):
thing that this time a year from now will have
our membership and all of our investors having a real
hands on experience on multiple shows, which is important because
that diversity across shows provides a little less liability on
your single investment too. That's one of the that's one

(26:48):
of the other things that is I call it the
trick bag in this high barrier to entry, right, writing
twenty five thousand dollars on one show is putting your
eggs in one basket, right, and the field has its risks,
But if you're spreading that because you're utilizing collective economics,

(27:12):
with all of our resources shared, we can spread the
wealth and mitigate our risk. So that's the initial aspect,
and then in five years from now we talk about
navigating a couple seasons. Hopefully these shows have done well,
we can branch out. Our relationships are building, our network
is thriving together. We're at a place where we can

(27:36):
start developing work. We can start instead of just saying, hey,
that's a project that feels promising, let's invest in it.
That's an opportunity five years from now where we say, hey,
we now have these resources to start creating and saying
who should we put on, what story should we say?
Who should be in the room?

Speaker 1 (27:57):
I like that now is pretty much at this point
just New York base, because you know, there's a theater
community in Philadelphia, in Chicago and Los Angeles, in London?

Speaker 2 (28:08):
Is it? You are so good? You're so I'm curious
like you, Oh, this is exactly what I'm talking about.
We think about Broadway so often colloquially as this New
York centric thing, and it creates another bubble, right, But

(28:29):
what we also know is that Broadway's a global brand.
You can go to Paris and see you know, the
Lion King in French.

Speaker 1 (28:39):
Like I saw MJ.

Speaker 2 (28:40):
The musical in the West End.

Speaker 1 (28:42):
It was incredible because everybody had a British accent and
it was like, really neat I saw on here too,
but saying it there was very unique, right, and I'm like,
I'm so glad I had that experience, right.

Speaker 2 (28:53):
So I think that this form has so much potential
for bridge building, and our you know, structure allows for
anyone domestically to participate. Right. Just like Broadway is supported
by audience members from all over the country and all

(29:16):
over the world, all those same people should be able
to invest on the other side and participate. So that's
what Second Act Theatrical Capital is doing really for the
first time with access like this ever before.

Speaker 1 (29:30):
Now, if people want to know more about what you're
doing or to become involved, how do they want find
out to maybe reach your organization and begin to become
a part of something like this If they don't, if
not for today, a year down the road or five
years down the road.

Speaker 2 (29:48):
Absolutely, so I would really encourage folks to check out
our work on the industry standard group dot com. Our
socials are tisg or. We also have a lot of
community engagement and educational opportunities for folks to participate. This

(30:09):
is free and open to the public because not only
do we believe in providing these economic opportunities, but also
we want to continue the work of this transparency. We
want to continue to allow not only our investors and members,
but everyone to learn about the models, to get insider

(30:33):
perspective from experts and producers at the top of the game.
So we've got fireside chat series that you can attend
and register. We have remote and zoom kind of panel
discussions and opportunities for everyone at different levels to get involved,
maybe find a new person, a new name to follow,

(30:57):
and like I said, it's a very uh small community,
so it's easy right now to kind of get tapped in.
You're only a stranger wants So the industry standard Group
dot com is your home base for learning about everything
that we're doing. And then you can find out how

(31:20):
to take advantage of the financial opportunity and the vesting
opportunity through we funder dot com. And that's second act,
theatrical capital on we funder.

Speaker 1 (31:31):
We funder yes, okay, not refunder, because that's what it
sounded like at first. We funder we funder. Adam, this
has been amazing and I am so glad I got
a chance to talk to you. This is something that
has really just like got me thinking and and and
wanting to explore and learn more about and wanting more
people to learn about as well, because you know, it's

(31:54):
it's one thing to learn about a new business, but
it's another thing to learn about a new avenue, which
is what I have learned from you today.

Speaker 2 (32:04):
Oh, thank you so much. You're so good. I love you.
Just set me up well.

Speaker 1 (32:11):
I wish you so much success and thank you for
being a part of Building Blackbiz podcast.

Speaker 2 (32:15):
Thank you