WEBVTT FILE
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[TV static drones]
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Downloaded from
YTS.MX
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[bright tone]
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Official YIFY movies site:
YTS.MX
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[indistinct chatter]
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What are you
wearing right now?
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What am I wearing?
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Oh, it's--
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I know.
I still got to support.
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Ugh.
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It's my Superman moment
right now.
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A lot of people stop me
when I'm wearing this shirt,
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and they go, oh, my God,
that's so cool!
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MoviePass, we remember them.
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Whatever happened
to those guys?
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[hip-hop music]
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If you're anything like me,
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you wish you had seen
all those movies
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that everyone's talking about.
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Well, there's one
red-hot company that gets it.
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MoviePass.
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- MoviePass.
- MoviePass.
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The popular
movie-ticket app.
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This is a MoviePass card.
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This was my best friend
for quite a while.
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MoviePass,
a subscription service.
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The Netflix
for the movie theaters.
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It sounded like a dream.
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You pay a monthly fee,
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and you can go to the movies
every single day.
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What are you waiting for?
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Get your movie on
with MoviePass.
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MoviePass's CEO Mitch Lowe
and Ted Farnsworth.
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Look at this
incredible growth.
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We thought
this could reinvigorate
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the moviegoing business.
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Any movie, any theater,
any day--that was me.
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MoviePass has been
very successful
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in bringing more people
to the theaters.
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This is getting
millions of users.
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A year ago,
a lot of people didn't know
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what MoviePass was.
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It's become such a big thing.
My mom has MoviePass.
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MoviePass is
the fastest-growing company
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ever in the history of media,
and the stock shot up.
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We were worth
$80 million-plus.
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He'd just spend, spend,
spend, spend, spend.
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Going to Coachella,
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partying with Big Boi
and John Travolta.
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Fifty fucking Cent!
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It is an endless list of,
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oh, my God,
what is happening here?
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They burned
through $250 million.
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Whoa, whoa. Wait, wait.
Whoa, whoa.
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We're the hottest brand out
there going for the last year.
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I mean, he gave me
big-pimpin' vibes.
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He said, everyone's
going to be rich.
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At that point,
everything was possible.
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They were on this gravy train
to greatness.
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What they did
is definitely illegal.
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It is theft,
and he actually got arrested.
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Karma's a bitch.
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My first moviegoing
experience was "Psycho."
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[screaming]
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My aunt had
an old El Camino,
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and she would take us all
to the drive-in.
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And we would hide
under a blanket in the back
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so she didn't have to also pay
the 25 cents for us kids.
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And in that shower scene...
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we all jumped
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and hit our heads
on the ceiling of the car.
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Movie theaters were slowly
but surely dying away,
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and I have been in
the business of entertainment
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for about 40 years.
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You're in total control...
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So many people said
that there was no way
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that Redbox could work,
that Netflix could work.
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Now, Mitch Lowe was part of
the founding team at Netflix.
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Now MoviePass CEO--
that's the service
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that offers an unlimited
monthly subscription for fans
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to catch theater showings on
tens of thousands of screens.
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You pay $39.95, and you go
to as many movies as you want.
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You used your iPhone or
Android app to pick the movie,
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the time, the theater.
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We activate a debit card
which we send you
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that gives you the money to
just walk up to the box office
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and pay for your ticket.
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- You used to work at Netflix.
- Yes.
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Is that where you kind of
got all these ideas?
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Yeah, you know...
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The whole idea here
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is to build
a big subscription base...
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In the same way
Netflix reinvigorated
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the home, you know,
rental experience.
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If MoviePass
could be successful,
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you could get people
back to the movie theater
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in that social environment,
on the big screen,
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with the big sound.
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I was really excited
that Mitch
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was the one
running the company.
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If there's anyone that's going
to make this company work,
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it's going to be someone
like Mitch.
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There was this real energy
around the brand.
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[upbeat rock music]
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I called my friend.
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I was like, you're never going
to believe where I got a job.
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I was, like,
such a fangirl about it
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that it really did feel like
I was getting a job at Netflix
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or I was getting a job
at Google or Facebook
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or any one of these,
like, big tech companies.
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We were at a WeWork,
so they, like,
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showed me, like, the snacks
and the tap on the bar.
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I was like,
wait, we're getting--
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We can drink at work?
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So I was just like
a kid in a candy store.
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MoviePass, funny enough,
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was my first
actual engineering job.
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They were the first company
to, like, actually give me,
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like, an offer.
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So it was the start
of my engineering career,
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which is pretty crazy.
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That first day, like,
really set the stage for,
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I'm working with people
who genuinely care
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and love what they do,
and especially Stacy, right?
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Oh, man, he loved it.
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Everybody loved
going to the movies,
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and we made moviegoing
easier, right?
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We brought people
back to the movies.
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Before MoviePass,
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I was the vice president
of marketing at Miramax,
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and I had worked on "Scream,"
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"Trainspotting," "The Crow."
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I remember being
walked around
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and introduced to the team.
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And, you know, we were
spearheaded by Mitch.
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And I thought that he was
a pretty compelling person,
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you know,
a bit of a visionary.
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And our vision at the time--
we wanted to build
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a large subscriber base
of movie lovers,
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but to do any kind of
all-you-can-eat subscription,
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you know, you need
a lot of money.
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MoviePass was hovering
around 20,000 subscribers.
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We're just treading water,
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and the money well
had dried up.
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[person shivering]
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We needed a lot more money.
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I was able to raise
a little bit here,
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a little bit there
from high-net-worth believers.
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I've got ties with a number
of the folks
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who were very early
at Netflix.
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And Mitch knows his stuff.
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The idea that streaming
was going to destroy theaters
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was worrisome to me.
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I thought
that we should play a role
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in trying to change that.
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I was at Facebook
from 2005 to 2010
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as general counsel
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and vice president
of corporate development
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and chief privacy officer
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and left to run
for attorney general.
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I lost the Democratic primary
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to this up-and-comer
named Kamala Harris,
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who you may have heard of.
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I was involved in MoviePass,
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but I knew that user growth
was critical.
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I talked to Mitch.
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He said that he'd had
some conversations
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with this guy Ted Farnsworth
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and that he had
some connections
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with folks
in New York finance circles,
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which would be,
you know, helpful.
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Ted was the CEO of HMNY.
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HMNY stands for
Helios and Matheson New York,
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a small data-analytics company
focused mainly on IT.
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He's extremely likeable,
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the typical CEO/entrepreneur.
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They love to chat it up.
They love to be friendly.
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And they go and take on
these companies,
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get people to really believe
in them.
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And he had a long history
of doing that
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in the beverage industry,
in the supplements industry.
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Ted has a great background
in finance
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and raising money,
PR and marketing.
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It was kind of natural.
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I knew that if Ted fell
in love with MoviePass,
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he would invest.
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So I went to meet him
and got to know him,
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thought he was
a super-smart guy.
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He said, I absolutely love
what you're doing.
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And he saw MoviePass
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as something that could fit
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under that umbrella.
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[upbeat jazz music]
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He's incredibly charming
and very much,
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you know, sort of knows
how to talk about the future
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and, ultimately, showed
passion for the business.
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He was a little worried
about the business,
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especially the total user base.
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MoviePass had never gotten
beyond 20,000.
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And he said you needed
millions of subscribers.
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20,000
was not going to cut it.
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The deal that was put
on the table
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was tens
of millions of dollars,
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which is more money than we'd
ever seen at one time, right?
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Which was very exciting
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but with such a big asterisk
next to it.
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In order to get
$25 million in cash,
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we had to reach
100,000 new subs
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within 6 months.
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But it took 5 years
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to get the 20,000 members
that we had.
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So we didn't know
if there's a way to do it.
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We explained the various
pricing models we had tested.
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And he asked us, what's
the one you think is the best?
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And we said, $14.95,
2 movies a month.
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But we're worried about
how much it's going to cost
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to market and, you know,
get people to try it.
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He said, no, what
you need to do is,
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you need to make
it so attractive
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that you don't need to spend
money on advertising.
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And I thought, okay,
let's give this a shot.
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MoviePass dropped
their prices...
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to $10 a month.
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[all cheering, screaming]
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MoviePass is now promising
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a month's worth
of movie tickets
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for about the cost
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of a single admission.
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- Ten bucks a month.
- It's a heck of a deal.
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[all cheering]
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I showed up to work.
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All I can just remember
is just all of our queues
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being in the red.
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Everyone wants to sign up.
Everyone wants a card.
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When can I start using it?
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And so, like,
we got bombarded.
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♪ ♪
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You could look down
for an hour
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00:10:13.405 --> 00:10:16.408
and see the customer number
increase by 20,000 people.
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I mean, it was remarkable.
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♪ ♪
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You have incredible demand.
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People love this.
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Their website
was crashing all day
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00:10:27.002 --> 00:10:30.839
from sheer volume of people
trying to go and visit it.
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00:10:30.839 --> 00:10:33.008
You went from $40 a month
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00:10:33.008 --> 00:10:34.509
to $9.95.
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What happened?
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This is the whole idea--
to get attention.
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[laughing]
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We thought
it was going to take
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00:10:46.104 --> 00:10:50.066
about a year to reach
100,000 new subscribers.
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00:10:50.066 --> 00:10:53.153
But all of a sudden,
we got 100,000 people
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in 48 hours
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00:10:55.113 --> 00:10:58.575
and then another 75,000,
like, the next day.
256
00:10:58.575 --> 00:11:00.201
[phone ringing]
257
00:11:00.201 --> 00:11:02.203
I remember Stacy
calling me and saying,
258
00:11:02.203 --> 00:11:05.331
shit, how are we going
to send out that many cards?
259
00:11:05.331 --> 00:11:07.250
We only have 50,000 cards.
260
00:11:07.250 --> 00:11:10.337
And those cards
weren't easy to make.
261
00:11:10.337 --> 00:11:14.966
You know, they are real
Mastercard debit cards.
262
00:11:14.966 --> 00:11:18.803
I was like, okay,
turn this promotion off
263
00:11:18.803 --> 00:11:21.848
so that we could order
more cards.
264
00:11:21.848 --> 00:11:24.142
We need to pump
the brakes a little bit
265
00:11:24.142 --> 00:11:27.520
to make sure we didn't have
a run on too many people
266
00:11:27.520 --> 00:11:29.898
that we couldn't manage it.
267
00:11:29.898 --> 00:11:34.402
I asked Stacy, how
in the world do we get cards?
268
00:11:34.402 --> 00:11:36.821
We have to hire a Brinks truck
269
00:11:36.821 --> 00:11:39.908
to bring a big truckload
of them
270
00:11:39.908 --> 00:11:41.868
to a new facility in LA.
271
00:11:41.868 --> 00:11:44.913
That's the only way we're
going to be able to catch up.
272
00:11:44.913 --> 00:11:46.331
It was not sustainable.
273
00:11:46.331 --> 00:11:50.669
I said to Mitch,
we can't do this every week.
274
00:11:50.669 --> 00:11:53.129
And he said,
no, this is great.
275
00:11:53.129 --> 00:11:55.590
Keep it going.
Let's try and figure it out.
276
00:11:55.590 --> 00:11:58.551
[upbeat music]
277
00:11:58.551 --> 00:12:01.346
♪ ♪
278
00:12:01.346 --> 00:12:04.557
All I did was check
my mail every single day
279
00:12:04.557 --> 00:12:06.017
for my MoviePass.
280
00:12:06.017 --> 00:12:08.770
The second I got my MoviePass,
I didn't think twice.
281
00:12:08.770 --> 00:12:12.190
I went from my mailbox
right to the movie theater.
282
00:12:12.190 --> 00:12:13.733
Today is awesome.
283
00:12:13.733 --> 00:12:15.902
Why?, you ask.
284
00:12:15.902 --> 00:12:18.405
My MoviePass card showed up.
285
00:12:18.405 --> 00:12:21.866
One movie a day every
single day with the pass.
286
00:12:21.866 --> 00:12:23.618
I'm telling you,
this is the truth.
287
00:12:23.618 --> 00:12:25.370
That's insane!
288
00:12:25.370 --> 00:12:26.705
The hottest startup
289
00:12:26.705 --> 00:12:28.206
to disrupt Hollywood
since Netflix
290
00:12:28.206 --> 00:12:30.542
is getting rave reviews
from moviegoers.
291
00:12:30.542 --> 00:12:31.710
I'd watch a lot of movies.
292
00:12:31.710 --> 00:12:33.169
I'd watch a movie twice now.
293
00:12:33.169 --> 00:12:34.587
I think I'm going
to invest in that.
294
00:12:34.587 --> 00:12:38.258
Going to the movie theater,
there's nothing like it.
295
00:12:38.258 --> 00:12:40.969
♪ ♪
296
00:12:40.969 --> 00:12:43.054
It was a Saturday afternoon,
297
00:12:43.054 --> 00:12:45.557
and I went
to the movie theater.
298
00:12:45.557 --> 00:12:49.352
And I see the person to my
left get out a MoviePass card.
299
00:12:49.352 --> 00:12:52.731
And I see two people here
get out a MoviePass card.
300
00:12:52.731 --> 00:12:54.774
And I see people over there,
301
00:12:54.774 --> 00:12:57.152
and they all have
MoviePass cards.
302
00:12:57.152 --> 00:13:00.488
♪ ♪
303
00:13:00.488 --> 00:13:02.615
It was exciting to see
people with the cards,
304
00:13:02.615 --> 00:13:03.783
like, in the wild.
305
00:13:03.783 --> 00:13:05.702
It felt like
I had, like, a secret.
306
00:13:05.702 --> 00:13:09.789
It was like, they don't know
I work at MoviePass.
307
00:13:09.789 --> 00:13:11.541
There was more
than one occasion
308
00:13:11.541 --> 00:13:13.710
where someone's MoviePass card
wasn't working at the theater,
309
00:13:13.710 --> 00:13:16.046
and I was like,
can I please help you?
310
00:13:16.046 --> 00:13:17.839
Like, I actually work there.
311
00:13:17.839 --> 00:13:20.425
I troubleshooted
whatever the issue was.
312
00:13:21.926 --> 00:13:25.096
When we saw the growth,
I mean, I was blown away,
313
00:13:25.096 --> 00:13:27.432
and I was excited
to see the promise
314
00:13:27.432 --> 00:13:29.601
of the model validated.
315
00:13:31.019 --> 00:13:34.689
Ted's team began marketing
it extraordinarily well.
316
00:13:34.689 --> 00:13:38.943
♪ ♪
317
00:13:38.943 --> 00:13:40.695
I always tell Mitch,
it's like we're doing
318
00:13:40.695 --> 00:13:42.113
social re-engineering.
319
00:13:42.113 --> 00:13:44.741
We're taking people
back to the theater.
320
00:13:44.741 --> 00:13:46.284
I'm seeing viral growth.
321
00:13:46.284 --> 00:13:48.661
I'm seeing no need
for paid marketing.
322
00:13:48.661 --> 00:13:52.499
♪ ♪
323
00:13:52.499 --> 00:13:54.334
The word of mouth
is so strong.
324
00:13:54.334 --> 00:13:57.420
♪ ♪
325
00:13:59.923 --> 00:14:02.384
Making MoviePass a household
name was absolutely
326
00:14:02.384 --> 00:14:04.928
one of those things
that we were starting to see
327
00:14:04.928 --> 00:14:06.888
actually happen.
328
00:14:06.888 --> 00:14:08.264
We're, at that time,
329
00:14:08.264 --> 00:14:11.309
the fastest-growing
subscription company
330
00:14:11.309 --> 00:14:13.770
since Spotify.
331
00:14:13.770 --> 00:14:15.855
There was
a retirement community,
332
00:14:15.855 --> 00:14:18.149
The Villages down in Florida,
333
00:14:18.149 --> 00:14:22.362
that actually has a network
of movie theaters.
334
00:14:22.362 --> 00:14:26.032
And I swear, every single
retired person in The Villages
335
00:14:26.032 --> 00:14:27.951
had a MoviePass card.
336
00:14:29.160 --> 00:14:32.831
A guy blamed his, like,
divorce with his wife
337
00:14:32.831 --> 00:14:36.710
on the fact that he loved
using MoviePass so much.
338
00:14:36.710 --> 00:14:41.297
So there were definitely some,
like, wacky, weird complaints.
339
00:14:41.297 --> 00:14:43.883
And just like that, you went
from 20,000 subscribers
340
00:14:43.883 --> 00:14:45.510
to 600,000.
341
00:14:45.510 --> 00:14:47.512
Has it gone up more than that?
That was the end of October.
342
00:14:47.512 --> 00:14:50.181
Oh, yeah, it goes up
every day, you know.
343
00:14:50.181 --> 00:14:52.350
Because of Ted's good idea,
344
00:14:52.350 --> 00:14:56.688
we were getting 100 million
in PR and marketing value
345
00:14:56.688 --> 00:14:59.399
and probably more each month.
346
00:14:59.399 --> 00:15:01.401
That made me want
to continue working.
347
00:15:01.401 --> 00:15:05.196
That made me want to focus on
my work and do well, you know.
348
00:15:05.196 --> 00:15:07.365
But while the phenomenon
is going on out there,
349
00:15:07.365 --> 00:15:10.702
you're just kind of,
like, blind to it
350
00:15:10.702 --> 00:15:13.830
until we reached
the million mark.
351
00:15:13.830 --> 00:15:17.042
And I knew that
was happening because I had
352
00:15:17.042 --> 00:15:19.002
friends and family
who were like,
353
00:15:19.002 --> 00:15:20.712
did you hear about MoviePass?
354
00:15:20.712 --> 00:15:22.297
I'm like, I work there.
You know?
355
00:15:22.297 --> 00:15:24.424
They're like, you do?
I'm like, yeah, I do.
356
00:15:24.424 --> 00:15:27.552
I had a cousin. She's like,
I love your product.
357
00:15:27.552 --> 00:15:29.929
Oh, my God, me and my
boyfriend go all the time.
358
00:15:29.929 --> 00:15:33.558
Like, damn, we're a lot bigger
than I knew.
359
00:15:33.558 --> 00:15:34.809
We were signing up
360
00:15:34.809 --> 00:15:38.229
a quarter of a million
new subs every month.
361
00:15:38.229 --> 00:15:42.650
It has hit
1.5 million subscribers.
362
00:15:42.650 --> 00:15:46.196
Mitch and Ted had a goal
based on this trajectory
363
00:15:46.196 --> 00:15:49.240
that they wanted to get
to 5 million customers.
364
00:15:49.240 --> 00:15:50.867
I was like, why are
you running so fast?
365
00:15:50.867 --> 00:15:52.327
You're out in front of--
366
00:15:52.327 --> 00:15:55.580
Just put it on pause
and catch our breath.
367
00:15:55.580 --> 00:15:59.292
They would push back and say,
we know what we're doing.
368
00:15:59.292 --> 00:16:01.294
We got this.
369
00:16:01.294 --> 00:16:03.505
Our plan was never
to have a price point
370
00:16:03.505 --> 00:16:05.173
that's promotional forever.
371
00:16:05.173 --> 00:16:06.925
I think that's
where the business got
372
00:16:06.925 --> 00:16:08.385
into a tricky place.
373
00:16:09.969 --> 00:16:12.555
In my conversations
with Mitch and Ted,
374
00:16:12.555 --> 00:16:14.432
I told them, I said,
375
00:16:14.432 --> 00:16:16.601
we're kind of learning
how to build the plane
376
00:16:16.601 --> 00:16:18.186
in mid-flight
377
00:16:18.186 --> 00:16:21.690
and changing it
from a crop duster
378
00:16:21.690 --> 00:16:25.443
to a 747 that can handle
large volumes of people.
379
00:16:25.443 --> 00:16:29.614
We were not prepared
to keep running at that pace.
380
00:16:29.614 --> 00:16:31.116
I would hear
381
00:16:31.116 --> 00:16:33.535
that Stacy would have
those conversations,
382
00:16:33.535 --> 00:16:36.371
you know, at the bar
after work or offsite,
383
00:16:36.371 --> 00:16:41.001
telling a few of the employees
that this would never work.
384
00:16:41.001 --> 00:16:43.253
He did kind of pull up,
like, a pitch deck
385
00:16:43.253 --> 00:16:45.922
of kind of what he saw
the growth trajectory
386
00:16:45.922 --> 00:16:47.382
of MoviePass looking like.
387
00:16:47.382 --> 00:16:50.510
He just wasn't being
a constructive member
388
00:16:50.510 --> 00:16:51.886
of the team.
389
00:16:51.886 --> 00:16:53.805
I immediately
kind of perceived
390
00:16:53.805 --> 00:16:56.975
that Stacy was
this impressive person
391
00:16:56.975 --> 00:16:59.686
that I had no clue
how he kind of fit
392
00:16:59.686 --> 00:17:01.396
into the landscape
of MoviePass.
393
00:17:01.396 --> 00:17:03.189
A lot of times when
they talk about MoviePass,
394
00:17:03.189 --> 00:17:06.317
you usually get a picture
of Mitch and Ted.
395
00:17:07.944 --> 00:17:10.780
And that was, like, the thing
that was, like, the spread
396
00:17:10.780 --> 00:17:13.366
to the media, right?
397
00:17:13.366 --> 00:17:18.872
MoviePass founders,
Mitch and Ted.
398
00:17:18.872 --> 00:17:21.082
But that's definitely
not the case.
399
00:17:21.082 --> 00:17:24.210
That's Stacy and Hamet.
400
00:17:24.210 --> 00:17:27.088
Stacy and Hamet had built
this company
401
00:17:27.088 --> 00:17:29.174
from the ground up since 2011.
402
00:17:29.174 --> 00:17:32.135
And when it finally...
403
00:17:32.135 --> 00:17:36.181
found its groove
with pop culture,
404
00:17:36.181 --> 00:17:38.850
it had already been taken over
by two men,
405
00:17:38.850 --> 00:17:42.228
Mitch Lowe and Ted Farnsworth.
406
00:17:42.228 --> 00:17:43.855
Which is funny, right?
407
00:17:43.855 --> 00:17:45.940
You start thinking
about it, right?
408
00:17:45.940 --> 00:17:47.525
Like, two Black guys
come up with an app.
409
00:17:47.525 --> 00:17:50.403
They don't get any credit,
but the two white guys do.
410
00:17:50.403 --> 00:17:52.822
[sighs]
411
00:17:52.822 --> 00:17:54.949
It was hard.
412
00:17:54.949 --> 00:17:59.537
All of this
was part of a bigger story.
413
00:18:08.463 --> 00:18:11.883
I grew up in Houston, Texas...
414
00:18:11.883 --> 00:18:13.551
born and raised.
415
00:18:13.551 --> 00:18:16.388
And, you know, I think
that it was really simple.
416
00:18:16.388 --> 00:18:20.058
Treat others how you'd want
to be treated and love God.
417
00:18:20.058 --> 00:18:23.311
[soft music]
418
00:18:23.311 --> 00:18:25.480
♪ ♪
419
00:18:25.480 --> 00:18:28.900
One day, I went to see
"Blade Runner."
420
00:18:30.819 --> 00:18:32.946
[dramatic music]
421
00:18:32.946 --> 00:18:35.740
I'd never seen
anything like that.
422
00:18:35.740 --> 00:18:37.409
And all I knew is,
423
00:18:37.409 --> 00:18:40.328
whatever that is,
I want to do that.
424
00:18:42.080 --> 00:18:44.207
I graduated in 1985.
425
00:18:44.207 --> 00:18:46.751
I went out to LA.
426
00:18:46.751 --> 00:18:50.005
And I would go on auditions.
427
00:18:50.005 --> 00:18:53.591
This one particular one,
the line was--
428
00:18:53.591 --> 00:18:55.260
it's HBO. Can I curse?
429
00:18:55.260 --> 00:18:57.053
Yeah, you can say
whatever you want, really.
430
00:18:57.053 --> 00:18:58.388
[chuckles]
The line was,
431
00:18:58.388 --> 00:19:00.098
"Give me
your motherfucking money!"
432
00:19:00.098 --> 00:19:01.683
I kept screwing up the line.
433
00:19:01.683 --> 00:19:04.269
Yo, give me
the motherfucking car keys!
434
00:19:04.269 --> 00:19:05.937
Give me
your motherfucking car!
435
00:19:05.937 --> 00:19:07.188
Give me
your motherfucking money
436
00:19:07.188 --> 00:19:08.773
and the keys!
437
00:19:08.773 --> 00:19:10.608
And this white guy
438
00:19:10.608 --> 00:19:12.610
comes out from behind the tape
and says, no.
439
00:19:12.610 --> 00:19:15.530
See, you have to hold
your hand like this.
440
00:19:15.530 --> 00:19:17.699
And he's explaining to me
how to be a thug.
441
00:19:17.699 --> 00:19:19.159
And it was just--
442
00:19:19.159 --> 00:19:20.618
I just left.
443
00:19:20.618 --> 00:19:23.288
I was like,
this isn't going to work.
444
00:19:23.288 --> 00:19:26.416
Music was always a part of me.
445
00:19:26.416 --> 00:19:29.544
I was actually
in a Rush cover band.
446
00:19:29.544 --> 00:19:32.172
[Rush's "Spirit of the Radio"
playing]
447
00:19:32.172 --> 00:19:34.758
One of my favorite
Rush songs to cover
448
00:19:34.758 --> 00:19:37.469
was "Spirit of the Radio."
449
00:19:37.469 --> 00:19:40.805
both: ♪ Begin the day
with a friendly voice ♪
450
00:19:40.805 --> 00:19:44.559
♪ A companion unobtrusive ♪
451
00:19:44.559 --> 00:19:46.269
Anyway, so...
452
00:19:46.269 --> 00:19:48.188
I got a call
from one of my friends.
453
00:19:48.188 --> 00:19:49.856
Motown was hiring.
454
00:19:49.856 --> 00:19:52.150
- ♪ So we come ♪
- ♪ Oh, oh ♪
455
00:19:52.150 --> 00:19:56.196
♪ To the end of the road ♪
456
00:19:56.196 --> 00:19:57.489
I worked my way up
457
00:19:57.489 --> 00:19:59.324
to product manager
for Boyz II Men.
458
00:19:59.324 --> 00:20:02.327
Their biggest hit single
was "End of the Road."
459
00:20:02.327 --> 00:20:06.164
Every high-school dance,
you put on Boyz II Men.
460
00:20:06.164 --> 00:20:08.958
They were like
the frickin' Beatles.
461
00:20:11.336 --> 00:20:14.756
When I was 25,
they hired me at Miramax,
462
00:20:14.756 --> 00:20:17.884
and I became the
vice president of marketing.
463
00:20:17.884 --> 00:20:22.514
I had grossed more than
$3 billion for studios.
464
00:20:22.514 --> 00:20:25.183
I was "Hollywood Reporter"
30 under 30.
465
00:20:25.183 --> 00:20:27.936
It's like I didn't just fall
off the truck.
466
00:20:29.562 --> 00:20:32.774
25 years ago,
I went to Sundance.
467
00:20:32.774 --> 00:20:34.859
I talked
to the head of the festival
468
00:20:34.859 --> 00:20:38.613
about helping them show
more films by people of color.
469
00:20:38.613 --> 00:20:41.491
They said if there were more
films that were good enough,
470
00:20:41.491 --> 00:20:43.743
they would show them.
471
00:20:43.743 --> 00:20:45.995
That just wasn't
a good-enough answer.
472
00:20:45.995 --> 00:20:49.708
So I ended up creating
the Urbanworld Film Festival.
473
00:20:50.917 --> 00:20:55.005
Our first festival was 1997.
474
00:20:55.005 --> 00:20:56.631
Today Urbanworld
475
00:20:56.631 --> 00:21:00.135
is one of the largest
festivals in the world.
476
00:21:00.135 --> 00:21:02.220
We premiered
more number-one films
477
00:21:02.220 --> 00:21:04.556
than any
North American festival.
478
00:21:04.556 --> 00:21:06.391
Such a big part
of my cinematic life.
479
00:21:06.391 --> 00:21:11.104
It's the festival that
fostered what I'm doing now.
480
00:21:11.104 --> 00:21:13.064
Stacy gave Black filmmakers,
481
00:21:13.064 --> 00:21:15.483
filmmakers that appealed
to urban markets,
482
00:21:15.483 --> 00:21:18.403
Latino markets, a place to
actually exhibit their films,
483
00:21:18.403 --> 00:21:20.572
and that's something that
hadn't been done before.
484
00:21:20.572 --> 00:21:22.782
With Urbanworld Film Festival,
485
00:21:22.782 --> 00:21:24.159
he found a great niche.
486
00:21:24.159 --> 00:21:25.577
He understood,
487
00:21:25.577 --> 00:21:28.955
find that customer, because
all you need is one niche.
488
00:21:28.955 --> 00:21:30.582
And those people,
489
00:21:30.582 --> 00:21:32.917
because they've been neglected
for so long,
490
00:21:32.917 --> 00:21:37.464
when they finally feel like
somebody just respects them,
491
00:21:37.464 --> 00:21:39.758
man, they're going to be
a customer forever.
492
00:21:39.758 --> 00:21:42.385
There were a lot
of subscription models
493
00:21:42.385 --> 00:21:44.220
starting to be on the horizon,
494
00:21:44.220 --> 00:21:46.598
from Netflix to Pandora.
495
00:21:46.598 --> 00:21:49.142
And I thought,
can we make a subscription
496
00:21:49.142 --> 00:21:50.435
out of Urbanworld?
497
00:21:50.435 --> 00:21:53.855
That was the origin
of MoviePass.
498
00:21:55.482 --> 00:21:58.777
I went around for five years,
499
00:21:58.777 --> 00:22:01.738
and I couldn't get anybody
to invest.
500
00:22:01.738 --> 00:22:05.241
A friend of mine
who's a movie producer says,
501
00:22:05.241 --> 00:22:07.327
have you talked to Hamet Watt?
502
00:22:07.327 --> 00:22:10.455
I think you and that brother
should talk.
503
00:22:10.455 --> 00:22:13.792
I was starting companies
and/or investing in companies.
504
00:22:13.792 --> 00:22:16.711
And that's all I've ever done
my whole career.
505
00:22:16.711 --> 00:22:19.005
I got very excited
about the opportunity
506
00:22:19.005 --> 00:22:20.674
in the theatrical window
507
00:22:20.674 --> 00:22:23.134
because I saw
that this was the part
508
00:22:23.134 --> 00:22:26.596
of the entertainment ecosystem
that innovated the least.
509
00:22:26.596 --> 00:22:28.306
Stacy and I immediately
510
00:22:28.306 --> 00:22:30.350
were finishing
each other's sentences,
511
00:22:30.350 --> 00:22:32.018
and we locked ourselves
in the room with whiteboards
512
00:22:32.018 --> 00:22:34.688
and started talking about
the world of subscription.
513
00:22:34.688 --> 00:22:36.439
We should do this.
We should do that.
514
00:22:36.439 --> 00:22:37.941
We should do this.
515
00:22:37.941 --> 00:22:40.402
The next thing you know, we
were putting together a model
516
00:22:40.402 --> 00:22:43.363
and a plan to build what we
were hoping would become
517
00:22:43.363 --> 00:22:46.157
the largest moviegoing
subscription business
518
00:22:46.157 --> 00:22:47.409
ever conceived.
519
00:22:47.409 --> 00:22:50.578
[upbeat music]
520
00:22:50.578 --> 00:22:52.580
♪ ♪
521
00:22:52.580 --> 00:22:56.084
Hamet said, I can raise
money for this in a month.
522
00:22:56.084 --> 00:22:58.503
I was like, yeah, right.
523
00:22:58.503 --> 00:23:00.797
And he said, if I can,
do we have a deal?
524
00:23:00.797 --> 00:23:02.048
Can we be partners?
525
00:23:02.048 --> 00:23:03.466
And I said, sure.
526
00:23:03.466 --> 00:23:07.721
So we raised $4 million
pretty early out of the gates.
527
00:23:10.015 --> 00:23:13.810
I remember the first hire
that we made at MoviePass.
528
00:23:13.810 --> 00:23:15.687
I remember sending the note,
welcome to MoviePass.
529
00:23:15.687 --> 00:23:18.398
And that was the first
of many hires that we made.
530
00:23:18.398 --> 00:23:22.485
It was a really
family-oriented atmosphere.
531
00:23:22.485 --> 00:23:24.070
We had a lot of fun.
532
00:23:24.070 --> 00:23:27.365
And we knew that this
was a special company.
533
00:23:27.365 --> 00:23:30.201
Very first version
of MoviePass,
534
00:23:30.201 --> 00:23:33.496
we built through
movietickets.com.
535
00:23:33.496 --> 00:23:35.790
They were part owned by AMC.
536
00:23:35.790 --> 00:23:38.960
That allowed us
to access the tickets.
537
00:23:38.960 --> 00:23:41.004
Everybody loved it.
538
00:23:41.004 --> 00:23:43.631
And we did
the Fourth of July launch.
539
00:23:43.631 --> 00:23:45.800
Here we go!
Here we go!
540
00:23:45.800 --> 00:23:48.386
"Transformers,"
the Michael Bay film.
541
00:23:48.386 --> 00:23:51.723
You're coming home,
old friend.
542
00:23:51.723 --> 00:23:54.267
We had all the press there.
543
00:23:54.267 --> 00:23:56.561
We showed them
how the product worked.
544
00:23:56.561 --> 00:23:58.063
We started the screening,
545
00:23:58.063 --> 00:24:01.399
and the press agent
brought us out and says,
546
00:24:01.399 --> 00:24:03.777
hey, guys,
something's happening.
547
00:24:03.777 --> 00:24:08.698
AMC is really upset
about this MoviePass thing.
548
00:24:09.908 --> 00:24:12.994
AMC released
a statement saying,
549
00:24:12.994 --> 00:24:15.997
whatever this was, they were
not in support of it.
550
00:24:15.997 --> 00:24:17.415
Oh, my gosh.
551
00:24:17.415 --> 00:24:20.752
The biggest player
in the industry is not happy.
552
00:24:20.752 --> 00:24:24.005
We got a cease and desist
from AMC.
553
00:24:24.005 --> 00:24:25.507
The music stopped.
554
00:24:25.507 --> 00:24:28.677
So we were literally born
on a Thursday,
555
00:24:28.677 --> 00:24:32.514
and we died on a Friday
before we ever even launched.
556
00:24:32.514 --> 00:24:34.057
After you get shut down,
557
00:24:34.057 --> 00:24:37.143
you start to realize that you
need to be independent
558
00:24:37.143 --> 00:24:39.771
or as independent as possible.
559
00:24:39.771 --> 00:24:41.606
The problem we needed
to solve at that time
560
00:24:41.606 --> 00:24:44.359
was just being able
to access tickets.
561
00:24:44.359 --> 00:24:46.569
Since the theaters
weren't allowing us
562
00:24:46.569 --> 00:24:47.987
to go through their system,
563
00:24:47.987 --> 00:24:50.615
we had no way into doing
business with them
564
00:24:50.615 --> 00:24:52.534
unless we built
our own system.
565
00:24:52.534 --> 00:24:55.745
That's when...
566
00:24:55.745 --> 00:24:59.749
the red card came to be born.
567
00:24:59.749 --> 00:25:01.459
You would go to a theater
568
00:25:01.459 --> 00:25:03.128
where you wanted
to see a movie.
569
00:25:03.128 --> 00:25:05.755
You would look in the app,
pick a showtime.
570
00:25:05.755 --> 00:25:08.008
Your app would verify
571
00:25:08.008 --> 00:25:10.135
that you were actually
at the theater
572
00:25:10.135 --> 00:25:11.720
that you wanted a ticket at.
573
00:25:11.720 --> 00:25:16.599
And then it will load funds
to purchase a ticket.
574
00:25:16.599 --> 00:25:18.018
At that time,
no one had figured out--
575
00:25:18.018 --> 00:25:20.103
And that's why we got a patent
granted on it.
576
00:25:20.103 --> 00:25:22.147
No one had figured out
a way to do that,
577
00:25:22.147 --> 00:25:24.149
to use location services
578
00:25:24.149 --> 00:25:25.984
to authenticate
579
00:25:25.984 --> 00:25:29.988
a presence in an environment
that would unlock access.
580
00:25:29.988 --> 00:25:33.992
♪ ♪
581
00:25:33.992 --> 00:25:37.829
Stacy and Hamet
had solved the problem of,
582
00:25:37.829 --> 00:25:40.623
how do we get access
to enough inventory?
583
00:25:40.623 --> 00:25:42.792
That was the secret sauce
for me.
584
00:25:42.792 --> 00:25:44.544
I think Stacy had sent me one.
585
00:25:44.544 --> 00:25:47.464
[laughs] And I tested it
to make sure that it worked.
586
00:25:47.464 --> 00:25:48.798
And it did.
587
00:25:48.798 --> 00:25:50.592
Like, I was able
to go to a theater
588
00:25:50.592 --> 00:25:53.553
and, you know, check in
on the app, drive the card.
589
00:25:53.553 --> 00:25:56.473
And, you know, that
was really why I'm like,
590
00:25:56.473 --> 00:25:58.141
oh, this can't go away.
591
00:25:58.141 --> 00:25:59.684
This is a great idea.
592
00:25:59.684 --> 00:26:02.312
We were running out
of capital.
593
00:26:02.312 --> 00:26:05.648
Chris said, I really like what
you guys are trying to build.
594
00:26:05.648 --> 00:26:07.525
And I'm going to give
you guys a million dollars
595
00:26:07.525 --> 00:26:09.694
to keep running the company.
596
00:26:09.694 --> 00:26:13.573
He, that day, wired
half a million dollars
597
00:26:13.573 --> 00:26:15.700
into our accounts.
598
00:26:15.700 --> 00:26:17.869
And I remember
saying to him,
599
00:26:17.869 --> 00:26:20.872
I said, Chris, if you come
into this deal,
600
00:26:20.872 --> 00:26:23.541
we're going to do
a fair deal with you
601
00:26:23.541 --> 00:26:26.544
in terms of the economics
that you'll get.
602
00:26:26.544 --> 00:26:29.422
But you'll also be
our partner.
603
00:26:29.422 --> 00:26:31.174
The terms he gave us
604
00:26:31.174 --> 00:26:35.512
were actually more favorable
than what we had discussed.
605
00:26:35.512 --> 00:26:38.765
And then Chris put
another investment in.
606
00:26:38.765 --> 00:26:41.810
That is really what gave us
the foundation
607
00:26:41.810 --> 00:26:43.770
to start to do a lot
of the stuff
608
00:26:43.770 --> 00:26:45.188
that we ultimately did.
609
00:26:45.188 --> 00:26:47.857
Stacy, first of all, how
exactly is this going to work?
610
00:26:47.857 --> 00:26:49.317
Pretty much
wherever you are,
611
00:26:49.317 --> 00:26:52.570
you're going to be able to go
to movies using MoviePass.
612
00:26:52.570 --> 00:26:55.240
We had a product now
that no one could stop.
613
00:26:57.117 --> 00:27:01.037
I remember trying to make
an appeal to Gerry Lopez,
614
00:27:01.037 --> 00:27:03.081
the CEO of AMC.
615
00:27:03.081 --> 00:27:05.250
We needed to make money,
obviously,
616
00:27:05.250 --> 00:27:06.501
as a subscription service.
617
00:27:06.501 --> 00:27:08.837
And part of that
was going to come
618
00:27:08.837 --> 00:27:11.923
from a partnership
with theaters.
619
00:27:11.923 --> 00:27:14.092
The holy grail
is you got to get
620
00:27:14.092 --> 00:27:15.760
what we called
"butts in seats," right?
621
00:27:15.760 --> 00:27:18.096
You got to get people
to come to the theater.
622
00:27:18.096 --> 00:27:19.931
What Stacy and Hamet
were presenting
623
00:27:19.931 --> 00:27:21.933
was a very innovative
and very different idea
624
00:27:21.933 --> 00:27:24.060
on how to drive people
to the movie theater.
625
00:27:24.060 --> 00:27:28.606
We said, we will improve
moviegoing by 60%.
626
00:27:28.606 --> 00:27:31.109
And if we do that,
all we want to do
627
00:27:31.109 --> 00:27:33.695
is participate
in some of that upside.
628
00:27:33.695 --> 00:27:36.448
Stacy and Hamet
did a fantastic job
629
00:27:36.448 --> 00:27:39.284
of teeing up a relationship
with AMC.
630
00:27:39.284 --> 00:27:40.285
They were visionaries,
631
00:27:40.285 --> 00:27:42.370
and they wanted to be
visionaries in the space.
632
00:27:42.370 --> 00:27:44.956
They knew that the historical
use of movie theaters
633
00:27:44.956 --> 00:27:46.958
was going to change
in radical ways.
634
00:27:46.958 --> 00:27:48.835
Their thinking was clear.
635
00:27:48.835 --> 00:27:51.588
It complemented all
of our strategic direction.
636
00:27:51.588 --> 00:27:53.798
Frankly, a no-brainer,
because if it works,
637
00:27:53.798 --> 00:27:56.551
we're going to want
to go national with it.
638
00:27:56.551 --> 00:27:59.095
So, we ran
a double-blind survey
639
00:27:59.095 --> 00:28:02.807
over a two-year period
at AMC exclusively.
640
00:28:02.807 --> 00:28:07.479
And we confirmed
there was 112% increase--
641
00:28:07.479 --> 00:28:08.813
I can still see that number--
642
00:28:08.813 --> 00:28:12.359
112% increase
in moviegoing behavior
643
00:28:12.359 --> 00:28:15.487
after people joined MoviePass,
644
00:28:15.487 --> 00:28:18.156
more than we had estimated.
645
00:28:18.156 --> 00:28:19.282
It could work.
646
00:28:19.282 --> 00:28:21.242
The attendance curve
could be bent in such a way
647
00:28:21.242 --> 00:28:23.203
that you could get
incremental moviegoing.
648
00:28:23.203 --> 00:28:25.163
This thing is a win-win-win
for the studios,
649
00:28:25.163 --> 00:28:27.248
the theater owners,
and the consumer.
650
00:28:28.750 --> 00:28:32.003
And Gerry agreed
to roll MoviePass out
651
00:28:32.003 --> 00:28:34.839
in partnership
with AMC nationwide.
652
00:28:34.839 --> 00:28:36.841
We were thrilled.
653
00:28:36.841 --> 00:28:38.802
The future was finally
going to happen.
654
00:28:38.802 --> 00:28:41.971
[dramatic music]
655
00:28:41.971 --> 00:28:44.599
♪ ♪
656
00:28:44.599 --> 00:28:47.852
But Gerry made a decision
to move on
657
00:28:47.852 --> 00:28:49.813
to another company.
658
00:28:49.813 --> 00:28:51.856
The new CEO was a guy
named Adam Aron,
659
00:28:51.856 --> 00:28:55.568
who was just
far less receptive.
660
00:28:55.568 --> 00:28:57.195
He gave us a hard no
661
00:28:57.195 --> 00:29:00.699
that he liked the idea
and believed in subscription,
662
00:29:00.699 --> 00:29:03.034
but said,
we'd rather do it ourselves.
663
00:29:03.034 --> 00:29:05.453
I didn't know
what we were going to do.
664
00:29:05.453 --> 00:29:08.123
I honestly was like,
we're done.
665
00:29:08.123 --> 00:29:11.918
♪ ♪
666
00:29:11.918 --> 00:29:14.212
All of these investors
that were kind of looking
667
00:29:14.212 --> 00:29:16.047
like they were
about to come in,
668
00:29:16.047 --> 00:29:18.049
everybody started slowing down.
669
00:29:18.049 --> 00:29:22.012
And it was, if theaters
won't invest in this concept
670
00:29:22.012 --> 00:29:24.639
and studios won't invest
in this concept,
671
00:29:24.639 --> 00:29:26.808
why should we?
672
00:29:26.808 --> 00:29:29.269
It wasn't that we
weren't ringing on the doors.
673
00:29:29.269 --> 00:29:32.397
We knew everybody.
We had met with everyone.
674
00:29:32.397 --> 00:29:34.065
Of all of the industries
675
00:29:34.065 --> 00:29:36.109
I've ever spent time in
in my career,
676
00:29:36.109 --> 00:29:38.611
I found moviegoing to be one
of the most insular, right?
677
00:29:38.611 --> 00:29:40.405
If you're not part
of the community,
678
00:29:40.405 --> 00:29:41.448
if you're not an insider,
679
00:29:41.448 --> 00:29:43.074
you're automatically
an outsider.
680
00:29:43.074 --> 00:29:44.826
Well, all industries
have a little bit of that.
681
00:29:44.826 --> 00:29:46.077
But in Hollywood,
682
00:29:46.077 --> 00:29:48.038
I found that that was probably
the worst of all.
683
00:29:48.038 --> 00:29:53.543
♪ ♪
684
00:29:53.543 --> 00:29:55.670
The cash burn
was still significant.
685
00:29:55.670 --> 00:29:57.964
And so I was providing
some more financing
686
00:29:57.964 --> 00:30:00.216
because I didn't want
to see it die.
687
00:30:00.216 --> 00:30:04.554
Somehow, Chris got connected
with Mitch.
688
00:30:04.554 --> 00:30:07.974
Mitch was starting to suggest
689
00:30:07.974 --> 00:30:12.687
that his involvement would help
unlock some more capital.
690
00:30:12.687 --> 00:30:14.814
Chris said,
I can't keep funding
691
00:30:14.814 --> 00:30:16.775
unless we make a change.
692
00:30:16.775 --> 00:30:21.613
And I'd like to bring in
Mitch Lowe as a CEO.
693
00:30:21.613 --> 00:30:22.989
I got on a red-eye,
694
00:30:22.989 --> 00:30:25.116
and I flew out to have
the conversation in person
695
00:30:25.116 --> 00:30:27.952
and to say, look,
this isn't working this way.
696
00:30:27.952 --> 00:30:31.456
We've got to go with Mitch
to kind of amplify
697
00:30:31.456 --> 00:30:34.000
some of the very good stuff
that we're doing.
698
00:30:34.000 --> 00:30:35.919
And I know you're not going
to be happy with that.
699
00:30:35.919 --> 00:30:37.295
But, you know,
700
00:30:37.295 --> 00:30:40.256
I think that you guys
could be good partners,
701
00:30:40.256 --> 00:30:42.717
but we need to put Mitch
in charge at this point
702
00:30:42.717 --> 00:30:46.137
and try to turbocharge
the operations here.
703
00:30:46.137 --> 00:30:50.975
He said, you can either
go with this, or I'm out.
704
00:30:50.975 --> 00:30:54.437
And I just didn't know
where we could find
705
00:30:54.437 --> 00:30:56.815
an ally that we had in Chris.
706
00:30:56.815 --> 00:30:58.692
I rolled with that decision,
707
00:30:58.692 --> 00:31:00.652
and that was a decision
that I made,
708
00:31:00.652 --> 00:31:02.904
to go in that direction.
709
00:31:02.904 --> 00:31:04.739
Stacy still had a role.
710
00:31:04.739 --> 00:31:06.408
I still had a role
on the board.
711
00:31:06.408 --> 00:31:09.494
And Mitch was going to be
some potentially new blood
712
00:31:09.494 --> 00:31:11.955
that might provide
713
00:31:11.955 --> 00:31:14.708
some gray hair and optics.
714
00:31:14.708 --> 00:31:16.167
Stacy and I were brothers
715
00:31:16.167 --> 00:31:17.919
in this journey
from the beginning.
716
00:31:17.919 --> 00:31:19.713
There were some concerns
717
00:31:19.713 --> 00:31:23.216
that both he and I had
around Mitch.
718
00:31:23.216 --> 00:31:25.635
When he joined,
719
00:31:25.635 --> 00:31:28.763
the board structure changed.
720
00:31:28.763 --> 00:31:31.141
Hamet and I were two seats.
721
00:31:31.141 --> 00:31:34.769
Chris was a seat,
then Mitch was a seat,
722
00:31:34.769 --> 00:31:37.981
and then Chris
had another seat.
723
00:31:37.981 --> 00:31:41.067
So you had
this shift of power.
724
00:31:42.444 --> 00:31:44.362
There were many times
that Stacy and I were talking
725
00:31:44.362 --> 00:31:46.781
to each other
about just keeping the faith
726
00:31:46.781 --> 00:31:48.700
and keeping on going.
727
00:31:48.700 --> 00:31:55.749
♪ ♪
728
00:31:55.749 --> 00:31:59.753
If you have a white male
729
00:31:59.753 --> 00:32:02.630
with more gray hair,
730
00:32:02.630 --> 00:32:07.302
that could inspire other
white males with white hair
731
00:32:07.302 --> 00:32:10.722
to be more comfortable
investing.
732
00:32:10.722 --> 00:32:12.766
It's a factor
that we considered
733
00:32:12.766 --> 00:32:15.727
through the entire
entrepreneurial journey.
734
00:32:17.187 --> 00:32:20.106
The stats are pretty clear,
especially back then.
735
00:32:20.106 --> 00:32:22.359
Women and minorities
736
00:32:22.359 --> 00:32:27.155
were only accessing 1% to 3%
of all venture capital.
737
00:32:27.155 --> 00:32:29.532
So that's
a pretty small number.
738
00:32:29.532 --> 00:32:33.244
And Hamet and I were
seasoned entrepreneurs
739
00:32:33.244 --> 00:32:36.331
and had been around and had
very successful track records.
740
00:32:36.331 --> 00:32:39.793
For Black founders,
Black entrepreneurs,
741
00:32:39.793 --> 00:32:42.545
no matter
what your business is,
742
00:32:42.545 --> 00:32:45.382
the access to capital...
743
00:32:45.382 --> 00:32:46.841
there's no equity.
744
00:32:46.841 --> 00:32:48.385
It's a challenge
for every entrepreneur,
745
00:32:48.385 --> 00:32:50.303
but it's much more
of a challenge
746
00:32:50.303 --> 00:32:53.431
for Black entrepreneurs
than it is for anyone else.
747
00:32:53.431 --> 00:32:57.977
There's certain stereotypes
that society has
748
00:32:57.977 --> 00:33:00.689
of what a successful
entrepreneur looks like,
749
00:33:00.689 --> 00:33:02.107
and we didn't look like that.
750
00:33:02.107 --> 00:33:03.983
And it's hard
to tell sometimes
751
00:33:03.983 --> 00:33:06.111
whether that lack
of receptivity
752
00:33:06.111 --> 00:33:08.738
is a function of doing
something disruptive
753
00:33:08.738 --> 00:33:09.948
in an industry
754
00:33:09.948 --> 00:33:12.992
or dealing with two brothers
755
00:33:12.992 --> 00:33:15.620
trying to do something
disruptive in an industry.
756
00:33:15.620 --> 00:33:18.623
A lot of times...
757
00:33:18.623 --> 00:33:20.000
African-American,
758
00:33:20.000 --> 00:33:22.085
because we don't have
all the opportunity,
759
00:33:22.085 --> 00:33:26.089
we're so excited that somebody
is believing in us,
760
00:33:26.089 --> 00:33:28.883
and sometimes
we're on our last breath,
761
00:33:28.883 --> 00:33:30.093
we take the money,
762
00:33:30.093 --> 00:33:32.053
and we don't ask
what you want out of it.
763
00:33:32.053 --> 00:33:35.181
Then whatever you get
is at a predatory level.
764
00:33:35.181 --> 00:33:38.476
So you're set up to fail.
765
00:33:38.476 --> 00:33:42.105
Mitch was brought in
as the CEO.
766
00:33:42.105 --> 00:33:46.151
Mitch came out to New York
to meet with the team.
767
00:33:46.151 --> 00:33:49.988
He said, so you're
on probation for a while,
768
00:33:49.988 --> 00:33:51.698
and I'm going to see
how you are
769
00:33:51.698 --> 00:33:54.993
and determine whether or not
I'm going to keep you.
770
00:33:54.993 --> 00:33:57.620
Oh, God.
These old stories.
771
00:33:59.289 --> 00:34:01.458
[scoffs]
772
00:34:01.458 --> 00:34:04.210
This is a company,
not a family.
773
00:34:04.210 --> 00:34:08.423
And, you know, we're here to
make the company successful,
774
00:34:08.423 --> 00:34:12.844
and everything has got to,
you know, revolve around that.
775
00:34:12.844 --> 00:34:15.013
I thought
that it was arrogant.
776
00:34:15.013 --> 00:34:17.390
I thought
that it was mean-spirited.
777
00:34:17.390 --> 00:34:19.392
I thought it was unnecessary.
778
00:34:19.392 --> 00:34:21.853
While Hamet
was a co-founder,
779
00:34:21.853 --> 00:34:24.356
he really was not active
at all.
780
00:34:24.356 --> 00:34:27.692
With Stacy, I realized,
you know, Stacy knows
781
00:34:27.692 --> 00:34:29.235
the ins and outs.
782
00:34:29.235 --> 00:34:31.029
He knows the software.
783
00:34:31.029 --> 00:34:35.033
And so I moved Stacy
from being CEO
784
00:34:35.033 --> 00:34:37.202
to being
chief operating officer.
785
00:34:38.495 --> 00:34:41.247
I'm just not going to say
786
00:34:41.247 --> 00:34:43.416
what came through my mind
at that moment.
787
00:34:43.416 --> 00:34:46.044
But it's like that sketch
from "Key & Peele"--
788
00:34:46.044 --> 00:34:47.879
"The Anger Translator."
789
00:34:47.879 --> 00:34:49.547
Good evening,
my fellow Americans.
790
00:34:49.547 --> 00:34:53.051
With me as always is
my anger translator, Luther.
791
00:34:53.051 --> 00:34:56.471
I hate you!
792
00:34:56.471 --> 00:34:57.806
86, you [bleep]--
793
00:34:57.806 --> 00:35:00.767
The anger translator saying
what he really wants to say.
794
00:35:00.767 --> 00:35:02.394
I was respectful to him.
795
00:35:02.394 --> 00:35:04.938
I said, I'm grateful
that you're here.
796
00:35:04.938 --> 00:35:06.690
I'm looking forward
to working with you.
797
00:35:06.690 --> 00:35:07.816
And that's what I said.
798
00:35:07.816 --> 00:35:10.235
I hear your voices,
and I'm aware of your concerns.
799
00:35:10.235 --> 00:35:12.070
So maybe if you can chill
the hell out
800
00:35:12.070 --> 00:35:13.947
for, like, a second,
then maybe I can focus
801
00:35:13.947 --> 00:35:15.615
on some [bleep], you know?
802
00:35:15.615 --> 00:35:18.368
♪ ♪
803
00:35:18.368 --> 00:35:21.371
I had an expectation that
Mitch was going to provide
804
00:35:21.371 --> 00:35:22.956
more financing to the company
805
00:35:22.956 --> 00:35:25.709
and that that was gonna take
some of the burden off of me.
806
00:35:25.709 --> 00:35:27.961
And that did not happen.
807
00:35:27.961 --> 00:35:31.673
And that's when HMNY
and Ted came in.
808
00:35:31.673 --> 00:35:33.675
Ted was just slick.
809
00:35:33.675 --> 00:35:38.096
That's the best word I could
come up with, very...
810
00:35:38.096 --> 00:35:39.764
just slick.
811
00:35:39.764 --> 00:35:44.185
We had skepticism around
whether or not HMNY had money.
812
00:35:44.185 --> 00:35:47.564
We had skepticisms
around whether or not
813
00:35:47.564 --> 00:35:50.692
they were credible
from a strategic standpoint--
814
00:35:50.692 --> 00:35:52.861
like, would they be
the right investors to have?
815
00:35:52.861 --> 00:35:55.989
But in terms of the capital,
816
00:35:55.989 --> 00:35:57.949
they actually did have
the capital.
817
00:35:57.949 --> 00:36:00.326
[applause]
818
00:36:00.326 --> 00:36:02.620
The pitch that Ted
and his group were making
819
00:36:02.620 --> 00:36:05.290
was that they would be
able to drive growth.
820
00:36:05.290 --> 00:36:07.667
First, I want to welcome
everybody here in...
821
00:36:07.667 --> 00:36:10.128
There was a hedge fund
that turned out
822
00:36:10.128 --> 00:36:12.964
to be the primary backer
823
00:36:12.964 --> 00:36:16.634
of HMNY--Hudson Bay.
824
00:36:16.634 --> 00:36:19.346
And so the first tranche
of the financing
825
00:36:19.346 --> 00:36:22.432
allowed us to start to do
some really interesting things
826
00:36:22.432 --> 00:36:24.142
that we had never
been able to do
827
00:36:24.142 --> 00:36:25.643
because
of the amount of capital.
828
00:36:25.643 --> 00:36:28.355
[cheers and applause]
829
00:36:28.355 --> 00:36:31.983
[all cheering, screaming]
830
00:36:31.983 --> 00:36:34.486
And the stock
is exploding today
831
00:36:34.486 --> 00:36:37.489
after the CNA team called it
a gold mine.
832
00:36:37.489 --> 00:36:41.534
Right now HMNY is up 21% today
833
00:36:41.534 --> 00:36:43.036
at 2,541.
834
00:36:43.036 --> 00:36:46.206
There was this huge run-up
of the stock,
835
00:36:46.206 --> 00:36:48.625
where a lot of people
were really excited about it.
836
00:36:48.625 --> 00:36:51.753
It got crazy
with Wall Street,
837
00:36:51.753 --> 00:36:53.380
particularly millennials.
838
00:36:53.380 --> 00:36:55.924
This was exactly
what they were looking for.
839
00:36:55.924 --> 00:36:57.926
They had missed out on Netflix.
840
00:36:57.926 --> 00:37:00.345
Put my money in this,
I could become a millionaire,
841
00:37:00.345 --> 00:37:02.013
like all those Netflix
millionaires.
842
00:37:02.013 --> 00:37:03.223
It took off.
843
00:37:03.223 --> 00:37:05.934
Really, the whole excitement
and lure for a retail investor
844
00:37:05.934 --> 00:37:09.020
is getting in on the ground
floor of the next billion,
845
00:37:09.020 --> 00:37:10.271
$10 billion business.
846
00:37:10.271 --> 00:37:12.357
I believe I got in around $9,
847
00:37:12.357 --> 00:37:14.150
and, man, I felt
like a genius.
848
00:37:14.150 --> 00:37:18.405
Shares climbed 146%.
849
00:37:18.405 --> 00:37:20.573
So $9.99, you can watch
as many movies you want.
850
00:37:20.573 --> 00:37:22.367
Fuck,
you can't beat that, man.
851
00:37:22.367 --> 00:37:24.577
That's better than Redbox.
Fuck Redbox.
852
00:37:24.577 --> 00:37:27.580
Now is an excellent,
excellent time
853
00:37:27.580 --> 00:37:29.290
to buy into HMNY.
854
00:37:29.290 --> 00:37:31.668
There's no denying
that it was a real rocket ship
855
00:37:31.668 --> 00:37:33.545
when it came
to subscriber growth.
856
00:37:33.545 --> 00:37:35.797
And that was
the number-one metric
857
00:37:35.797 --> 00:37:38.967
that a lot of people
were paying attention to.
858
00:37:38.967 --> 00:37:40.844
And that was just
through the roof.
859
00:37:43.430 --> 00:37:46.474
It was pretty exciting
860
00:37:46.474 --> 00:37:49.811
because the stock
was going through the roof.
861
00:37:49.811 --> 00:37:53.815
Public markets were excited
about the user growth.
862
00:37:53.815 --> 00:37:58.319
The stock price climbed
from $2 a share
863
00:37:58.319 --> 00:37:59.863
up to $38 a share.
864
00:37:59.863 --> 00:38:01.740
So the brand was there.
865
00:38:01.740 --> 00:38:04.117
The acknowledgment
in the marketplace
866
00:38:04.117 --> 00:38:06.578
of the value we had created
was there,
867
00:38:06.578 --> 00:38:09.581
but we were paying
for tickets full price.
868
00:38:09.581 --> 00:38:13.585
The average ticket price
was $11.50,
869
00:38:13.585 --> 00:38:16.421
and we were charging
$10 a month.
870
00:38:16.421 --> 00:38:19.507
But people were going
to four movies a month.
871
00:38:19.507 --> 00:38:22.427
We were losing a lot of money.
872
00:38:22.427 --> 00:38:26.139
And so you took
that $25 million,
873
00:38:26.139 --> 00:38:29.100
and you just said, poof.
874
00:38:29.100 --> 00:38:32.687
We had a million users,
and active users, you know,
875
00:38:32.687 --> 00:38:34.606
not just like,
oh, I have a subscription,
876
00:38:34.606 --> 00:38:36.941
but I don't really use it--
no, they were active.
877
00:38:36.941 --> 00:38:38.985
Or some people
were seeing the same movie
878
00:38:38.985 --> 00:38:40.236
six times in a week.
879
00:38:40.236 --> 00:38:41.404
Okay, I will admit it.
880
00:38:41.404 --> 00:38:43.615
I would go see
881
00:38:43.615 --> 00:38:46.618
about a half hour
of "The Avengers"
882
00:38:46.618 --> 00:38:48.828
and then come back
the next day
883
00:38:48.828 --> 00:38:51.956
to see the next hour
of "The Avengers."
884
00:38:51.956 --> 00:38:53.583
And then if I missed a part,
885
00:38:53.583 --> 00:38:55.835
I would go back the next day
886
00:38:55.835 --> 00:38:58.713
to go see the first half
of "The Avengers" again.
887
00:38:58.713 --> 00:39:00.298
Why?
888
00:39:00.298 --> 00:39:03.051
Because I could.
[laughs]
889
00:39:03.051 --> 00:39:06.304
I said, I'm going to go
to watch "Crazy Rich Asians"
890
00:39:06.304 --> 00:39:10.225
every single day for a week
at the theater.
891
00:39:10.225 --> 00:39:12.477
[laughs] Yeah.
892
00:39:12.477 --> 00:39:15.230
I watched "Crazy Rich Asians"
14 times overall.
893
00:39:15.230 --> 00:39:18.233
[gong sounds,
indistinct chatter]
894
00:39:18.233 --> 00:39:19.818
Because they can.
895
00:39:19.818 --> 00:39:21.945
I liked it a lot--it's
a really good romantic comedy,
896
00:39:21.945 --> 00:39:23.822
and not many good romantic
comedies around anymore.
897
00:39:23.822 --> 00:39:27.158
I went probably close
to 20 movies a month.
898
00:39:27.158 --> 00:39:28.868
I wish I could have seen more.
899
00:39:28.868 --> 00:39:30.161
You know, I was engaged,
900
00:39:30.161 --> 00:39:32.455
so I didn't have
a lot of free time.
901
00:39:32.455 --> 00:39:35.750
In total, I went to
the movie theater 428 times.
902
00:39:35.750 --> 00:39:37.419
[laughs]
903
00:39:37.419 --> 00:39:39.879
Don't hate the player,
hate the game.
904
00:39:39.879 --> 00:39:42.507
Every board meeting
I was vehement
905
00:39:42.507 --> 00:39:44.801
that we needed to increase
the price
906
00:39:44.801 --> 00:39:47.804
because there was no way
for it to be profitable
907
00:39:47.804 --> 00:39:48.972
at this level.
908
00:39:48.972 --> 00:39:51.307
But Mitch and Ted
were doing their own thing
909
00:39:51.307 --> 00:39:53.560
and making those decisions.
910
00:39:53.560 --> 00:39:55.520
Obviously, we couldn't have
a subscription service
911
00:39:55.520 --> 00:39:58.648
where, you know, we're paying
912
00:39:58.648 --> 00:40:01.026
more than we're receiving.
913
00:40:01.026 --> 00:40:05.363
But I think Mitch and Ted
were more focused
914
00:40:05.363 --> 00:40:08.033
on what was making
the stock move,
915
00:40:08.033 --> 00:40:12.037
which I think at that time
was just top-line user growth.
916
00:40:12.037 --> 00:40:14.122
And that was all
that they were fixated on.
917
00:40:14.122 --> 00:40:16.458
And they were confident
that would allow them
918
00:40:16.458 --> 00:40:18.418
to figure the rest out later.
919
00:40:18.418 --> 00:40:21.755
We have figured out a way
to give people a deal
920
00:40:21.755 --> 00:40:24.591
they cannot believe
we can even afford to give.
921
00:40:24.591 --> 00:40:27.260
Mitch was able to get
a lot of deals in place
922
00:40:27.260 --> 00:40:30.138
that Stacy had not managed
to move along.
923
00:40:30.138 --> 00:40:33.141
We're on the way
to over 5 million subscribers
924
00:40:33.141 --> 00:40:34.517
by the end of the year.
925
00:40:34.517 --> 00:40:38.229
And that's when the cash flow
starts to become positive.
926
00:40:38.229 --> 00:40:41.232
We knew 5 million subscribers
927
00:40:41.232 --> 00:40:43.401
would get us to somewhere
928
00:40:43.401 --> 00:40:45.904
between 12% to 15%
929
00:40:45.904 --> 00:40:48.573
of all the box office
in the country,
930
00:40:48.573 --> 00:40:51.701
which I believed
was enough clout
931
00:40:51.701 --> 00:40:56.664
to convince AMC
to discount us,
932
00:40:56.664 --> 00:41:00.001
the studios to pay us millions
of dollars a month
933
00:41:00.001 --> 00:41:01.086
to advertise.
934
00:41:01.086 --> 00:41:03.922
Then selling the data
935
00:41:03.922 --> 00:41:06.299
was going to be
extremely valuable.
936
00:41:06.299 --> 00:41:08.259
How much of this
is about the data,
937
00:41:08.259 --> 00:41:09.844
about knowing
Tyler and Melissa and me?
938
00:41:09.844 --> 00:41:12.097
Yeah, a huge amount of it
is the data.
939
00:41:12.097 --> 00:41:15.600
Because, you know,
this whole system is broken
940
00:41:15.600 --> 00:41:16.976
in the movie-theater business.
941
00:41:16.976 --> 00:41:20.146
Imagine, Warner Brothers
does not know
942
00:41:20.146 --> 00:41:22.440
who saw
all the previous Batman.
943
00:41:22.440 --> 00:41:25.443
They have to spend
$50 million, $100 million
944
00:41:25.443 --> 00:41:27.612
marketing every time
a film comes out.
945
00:41:27.612 --> 00:41:29.656
And that's why
Helios and Matheson,
946
00:41:29.656 --> 00:41:32.492
a data analytics firm,
actually just made a--
947
00:41:32.492 --> 00:41:34.035
they took a stake
in your company.
948
00:41:34.035 --> 00:41:35.161
That's right.
949
00:41:35.161 --> 00:41:37.330
There was a ton
of enthusiasm,
950
00:41:37.330 --> 00:41:41.876
but we were, like,
severely understaffed.
951
00:41:41.876 --> 00:41:44.796
A big moment for us
was the first time
952
00:41:44.796 --> 00:41:47.382
that the, like, app went down.
953
00:41:47.382 --> 00:41:49.884
The entire platform
was virtually unusable.
954
00:41:54.681 --> 00:41:57.308
Thursday night
to Sunday night,
955
00:41:57.308 --> 00:41:59.436
we were being hit hard.
956
00:41:59.436 --> 00:42:00.979
It was one hit
after another.
957
00:42:00.979 --> 00:42:03.481
Our servers
were getting annihilated...
958
00:42:03.481 --> 00:42:06.067
[chuckles]
All the time getting emails,
959
00:42:06.067 --> 00:42:07.777
errors, errors, errors.
960
00:42:07.777 --> 00:42:11.322
I worried about the brand,
961
00:42:11.322 --> 00:42:13.533
our reputation
in the industry.
962
00:42:13.533 --> 00:42:15.452
Mitch and Ted
would push back and say,
963
00:42:15.452 --> 00:42:17.328
we know what we're doing.
964
00:42:17.328 --> 00:42:18.997
We bought you.
965
00:42:18.997 --> 00:42:20.206
Thank you for sharing.
966
00:42:20.206 --> 00:42:22.125
[train horn blaring]
967
00:42:22.125 --> 00:42:24.753
♪ ♪
968
00:42:26.963 --> 00:42:30.508
At the monthly board meeting,
Hamet and I were told
969
00:42:30.508 --> 00:42:33.178
we were being removed
from the board.
970
00:42:34.846 --> 00:42:37.515
They said, hey,
we're reconstituting the board.
971
00:42:37.515 --> 00:42:41.311
We don't want
the co-founders on it.
972
00:42:41.311 --> 00:42:43.480
I remember Stacy pushing back.
973
00:42:43.480 --> 00:42:46.900
It broke my heart to see
two Black founders
974
00:42:46.900 --> 00:42:49.027
create a company
the way we did,
975
00:42:49.027 --> 00:42:52.197
and then all of a sudden,
there was an all-white board.
976
00:42:52.197 --> 00:42:55.075
I didn't want to be
in a place where I was, like,
977
00:42:55.075 --> 00:42:57.786
really feeling like
in the back of the bus.
978
00:42:57.786 --> 00:42:59.829
I'd say to myself,
the value is high.
979
00:42:59.829 --> 00:43:02.290
I can only hope
that these guys
980
00:43:02.290 --> 00:43:05.794
are going to be aligned
with us and be good stewards
981
00:43:05.794 --> 00:43:08.296
of the capital
to continue to make sure
982
00:43:08.296 --> 00:43:10.382
that the business is valuable.
983
00:43:10.382 --> 00:43:12.425
Stacy was...
984
00:43:12.425 --> 00:43:14.886
because he had been more
truly day to day,
985
00:43:14.886 --> 00:43:16.680
fought that a little bit more.
986
00:43:16.680 --> 00:43:18.765
Unfortunately,
there are people
987
00:43:18.765 --> 00:43:23.353
who are not cut out
for the stress and anxiety
988
00:43:23.353 --> 00:43:25.021
caused in a start-up.
989
00:43:25.021 --> 00:43:27.232
Ultimately, that was
a decision that Mitch made,
990
00:43:27.232 --> 00:43:29.150
and it was one
that we needed to back him on--
991
00:43:29.150 --> 00:43:31.528
or we felt we needed
to back him on at the time.
992
00:43:31.528 --> 00:43:34.572
I reached out to Chris
when they told me
993
00:43:34.572 --> 00:43:37.283
they were kicking me
off the board.
994
00:43:37.283 --> 00:43:38.868
He didn't respond.
995
00:43:38.868 --> 00:43:41.579
Chris is such a sweet guy.
996
00:43:41.579 --> 00:43:44.416
The last thing he would ever do
is fire anybody.
997
00:43:44.416 --> 00:43:46.251
So he said, you deal with it.
998
00:43:46.251 --> 00:43:48.378
And so that's what I did.
999
00:43:49.879 --> 00:43:53.591
A few weeks later,
there was an email from Mitch.
1000
00:43:53.591 --> 00:43:55.510
"We want to thank you
for your services,
1001
00:43:55.510 --> 00:43:58.138
"but you're no longer needed
at the company,
1002
00:43:58.138 --> 00:44:00.223
"and...
1003
00:44:00.223 --> 00:44:04.102
there will be someone moving
into your office next week."
1004
00:44:04.102 --> 00:44:06.563
We were all
just pretty upset.
1005
00:44:06.563 --> 00:44:09.774
How do you fire Stacy Spikes
from MoviePass?
1006
00:44:09.774 --> 00:44:11.568
The founder of the company
is leaving.
1007
00:44:11.568 --> 00:44:12.902
That's not a good sign.
1008
00:44:12.902 --> 00:44:14.946
He's, like, the heart
of MoviePass.
1009
00:44:14.946 --> 00:44:17.782
I think I did a very fair--
1010
00:44:17.782 --> 00:44:19.743
You know, he still owned
all his stock.
1011
00:44:19.743 --> 00:44:21.703
He still owned
all his options.
1012
00:44:21.703 --> 00:44:23.955
I just thought
that it would be better
1013
00:44:23.955 --> 00:44:26.041
if he wasn't a part
of the team.
1014
00:44:26.041 --> 00:44:28.251
Some people
were really upset.
1015
00:44:28.251 --> 00:44:31.296
A few people started crying.
1016
00:44:31.296 --> 00:44:33.089
A lot of hugs.
1017
00:44:33.089 --> 00:44:36.009
And I said, you know I live
right around the corner.
1018
00:44:36.009 --> 00:44:38.928
I'll be there
if you need anything.
1019
00:44:38.928 --> 00:44:41.097
I packed my stuff up,
1020
00:44:41.097 --> 00:44:44.517
and I left the key
on the desk,
1021
00:44:44.517 --> 00:44:46.686
and I walked out of my office.
1022
00:44:48.271 --> 00:44:50.357
I called my wife before.
1023
00:44:50.357 --> 00:44:53.693
So I think she had gotten
all of her crying and stuff
1024
00:44:53.693 --> 00:44:55.862
completely out
before I got there.
1025
00:44:55.862 --> 00:44:58.823
But I got home,
and she gave me a big hug,
1026
00:44:58.823 --> 00:45:00.909
and she says,
honey, I'm so sorry.
1027
00:45:02.160 --> 00:45:04.829
And then it just
kind of settled in.
1028
00:45:04.829 --> 00:45:07.499
It was like, wow,
this is a trip.
1029
00:45:07.499 --> 00:45:13.797
♪ ♪
1030
00:45:13.797 --> 00:45:16.091
[fireworks popping]
1031
00:45:16.091 --> 00:45:18.593
[upbeat music]
1032
00:45:18.593 --> 00:45:25.350
♪ ♪
1033
00:45:31.356 --> 00:45:34.526
No one knew anything about
the founder of the company
1034
00:45:34.526 --> 00:45:36.027
being ousted,
1035
00:45:36.027 --> 00:45:38.196
but at this point,
that's when the company
1036
00:45:38.196 --> 00:45:39.406
drastically changed.
1037
00:45:41.199 --> 00:45:43.785
There was definitely
an atmosphere of partying.
1038
00:45:43.785 --> 00:45:45.704
You know, every single month,
1039
00:45:45.704 --> 00:45:47.872
there was
a MoviePass-hosted event.
1040
00:45:47.872 --> 00:45:50.500
That was really part
of the excitement
1041
00:45:50.500 --> 00:45:53.044
of our operations,
1042
00:45:53.044 --> 00:45:56.881
trying to develop PR
and marketing...
1043
00:45:58.174 --> 00:46:00.677
Making contacts.
1044
00:46:00.677 --> 00:46:02.387
Ted's the best at that.
1045
00:46:04.431 --> 00:46:06.933
He is someone who understands
1046
00:46:06.933 --> 00:46:10.270
what convinces people
to buy a product.
1047
00:46:11.730 --> 00:46:13.898
He is exuberant.
1048
00:46:13.898 --> 00:46:17.068
Ted portrayed
a kind of visionary status
1049
00:46:17.068 --> 00:46:20.113
that you see
with business leaders like him.
1050
00:46:20.113 --> 00:46:23.992
I asked him one time,
why are you giving a $100 tip
1051
00:46:23.992 --> 00:46:26.911
you know, for a sandwich?
1052
00:46:26.911 --> 00:46:30.040
And he said, my mom put me
through school.
1053
00:46:30.040 --> 00:46:32.417
She raised us all on tips.
1054
00:46:32.417 --> 00:46:36.796
♪ ♪
1055
00:46:36.796 --> 00:46:39.382
Our first
company holiday party,
1056
00:46:39.382 --> 00:46:41.968
everyone's just--you know,
wine everywhere, right?
1057
00:46:41.968 --> 00:46:44.387
Just wine, wine, wine--free.
Like, here take it.
1058
00:46:44.387 --> 00:46:46.139
Mitch was making a toast,
1059
00:46:46.139 --> 00:46:48.350
and he said, all your
stock options, you know--
1060
00:46:48.350 --> 00:46:50.268
You're gonna be good.
We're gonna be making money.
1061
00:46:50.268 --> 00:46:52.520
He said, mark my words.
Everyone's going to be rich.
1062
00:46:52.520 --> 00:46:55.273
Everyone's gonna make it.
1063
00:46:55.273 --> 00:46:58.735
We all went back
to Ted's house, his apartment.
1064
00:46:58.735 --> 00:47:00.570
It was very nice.
[laughs] It was very nice.
1065
00:47:01.821 --> 00:47:04.824
[elevator bell dings]
1066
00:47:04.824 --> 00:47:06.618
That was always
something that was--
1067
00:47:06.618 --> 00:47:08.495
especially seeing
his apartment building--
1068
00:47:08.495 --> 00:47:13.375
was, like, living in this,
you know, lavish penthouse.
1069
00:47:13.375 --> 00:47:16.920
Ted is a wealthy guy
who has a lot of connections
1070
00:47:16.920 --> 00:47:19.297
who were changing the culture.
1071
00:47:19.297 --> 00:47:22.801
[dramatic music]
1072
00:47:22.801 --> 00:47:25.261
His nephew worked there,
1073
00:47:25.261 --> 00:47:28.264
you know, some other
family members, close friends.
1074
00:47:28.264 --> 00:47:30.433
My friend of this
and my friend of that.
1075
00:47:31.768 --> 00:47:35.939
Ted's official photographer
is his executive assistant.
1076
00:47:35.939 --> 00:47:38.983
Bob Ellis was a close friend
of Ted Farnsworth--
1077
00:47:38.983 --> 00:47:42.153
is the ex-husband
of Diana Ross.
1078
00:47:42.153 --> 00:47:46.324
He has been in and out
of the Hollywood social scene
1079
00:47:46.324 --> 00:47:48.159
for decades,
1080
00:47:48.159 --> 00:47:50.537
was basically hired
to be in charge
1081
00:47:50.537 --> 00:47:53.248
of marketing as a consultant.
1082
00:47:53.248 --> 00:47:55.000
I'm going to talk
a little bit
1083
00:47:55.000 --> 00:47:57.919
about relationships
and connecting, and...
1084
00:47:57.919 --> 00:48:00.672
One of the major figures
that Mitch Lowe hired
1085
00:48:00.672 --> 00:48:02.173
was Khalid Itum.
1086
00:48:02.173 --> 00:48:05.719
He was someone
who was selling furniture
1087
00:48:05.719 --> 00:48:08.555
at one point in his life and
decided to change things up.
1088
00:48:08.555 --> 00:48:12.934
And he happened to meet Mitch
at a conference.
1089
00:48:12.934 --> 00:48:14.352
Basically pitched him.
1090
00:48:14.352 --> 00:48:18.356
Said, hey, I think I could be
a good fit for your team.
1091
00:48:18.356 --> 00:48:21.067
He just got to the point
of saying the right things,
1092
00:48:21.067 --> 00:48:23.653
that he just kept going up
and up, up the ladder.
1093
00:48:26.156 --> 00:48:30.076
We needed to think
about having an office in LA.
1094
00:48:30.076 --> 00:48:32.078
I thought of Khalid--
1095
00:48:32.078 --> 00:48:34.748
someone who could connect
with the studios
1096
00:48:34.748 --> 00:48:38.043
to sell advertising
and work out data.
1097
00:48:38.043 --> 00:48:41.713
I made him VP
of business development.
1098
00:48:41.713 --> 00:48:43.965
Khalid, the connector
that he is,
1099
00:48:43.965 --> 00:48:46.718
knows everybody and brought on
a number of people
1100
00:48:46.718 --> 00:48:48.511
in Los Angeles.
1101
00:48:50.263 --> 00:48:53.016
We have this entity
called MoviePass Ventures
1102
00:48:53.016 --> 00:48:55.560
that's going to make movies.
1103
00:48:55.560 --> 00:48:58.396
[upbeat music]
1104
00:48:58.396 --> 00:49:02.025
MoviePass had the ability
to make a small film--
1105
00:49:02.025 --> 00:49:04.527
you know, $1 million,
$2 million films.
1106
00:49:04.527 --> 00:49:07.906
MoviePass could ensure
their success
1107
00:49:07.906 --> 00:49:11.659
by promoting them
to our 3 million subscribers,
1108
00:49:11.659 --> 00:49:13.661
buying a ton of tickets.
1109
00:49:13.661 --> 00:49:15.747
♪ ♪
1110
00:49:15.747 --> 00:49:18.166
A million here and there
1111
00:49:18.166 --> 00:49:21.628
seemed like small change,
1112
00:49:21.628 --> 00:49:25.715
especially relative
to what I saw as the benefit
1113
00:49:25.715 --> 00:49:28.426
that it could be.
1114
00:49:28.426 --> 00:49:32.138
They were
on a spending spree.
1115
00:49:32.138 --> 00:49:34.391
It was very nerve-racking
1116
00:49:34.391 --> 00:49:37.102
because we owned
a decent chunk of the business
1117
00:49:37.102 --> 00:49:39.938
and the value of the business
had gone up so much.
1118
00:49:39.938 --> 00:49:43.775
We put our everything into it
1119
00:49:43.775 --> 00:49:45.735
and left at a high point,
1120
00:49:45.735 --> 00:49:48.279
although we had an asterisk
next to that high point.
1121
00:49:48.279 --> 00:49:51.157
When I was fired
from MoviePass,
1122
00:49:51.157 --> 00:49:53.451
my ownership was valued
1123
00:49:53.451 --> 00:49:55.995
at around approximately
$80 million.
1124
00:49:55.995 --> 00:49:59.290
But there's, like,
a 12-month lock-up period
1125
00:49:59.290 --> 00:50:01.459
that you're not able
to sell your shares.
1126
00:50:01.459 --> 00:50:05.797
If you can't sell it,
it's hard to really count it.
1127
00:50:05.797 --> 00:50:09.676
And so we are hoping
and dependent
1128
00:50:09.676 --> 00:50:13.930
on that business maintaining
and growing its value
1129
00:50:13.930 --> 00:50:16.808
but not in a position
to control that.
1130
00:50:20.895 --> 00:50:22.188
That's why I don't count that.
1131
00:50:22.188 --> 00:50:24.649
I don't count that shit
until it's in my account.
1132
00:50:24.649 --> 00:50:28.528
It's dangerous to do that math
before you can spend it.
1133
00:50:28.528 --> 00:50:31.656
And so it's an incredible
amount of anxiety.
1134
00:50:31.656 --> 00:50:32.991
You're not behind the wheel.
1135
00:50:32.991 --> 00:50:34.617
You're not even
close to the wheel.
1136
00:50:34.617 --> 00:50:37.495
Oh, my God, are they really
spending that much money now?
1137
00:50:37.495 --> 00:50:39.456
Like, that's not going
to sustain, right?
1138
00:50:39.456 --> 00:50:41.332
I'm worried that
that's not going to sustain.
1139
00:50:41.332 --> 00:50:46.254
But maybe they had
a rabbit in the hat.
1140
00:50:46.254 --> 00:50:49.132
Joining us now,
MoviePass 's CEO Mitch Lowe
1141
00:50:49.132 --> 00:50:50.425
and Ted Farnsworth.
1142
00:50:50.425 --> 00:50:52.010
Welcome, gentlemen.
- Thank you for having us.
1143
00:50:52.010 --> 00:50:54.179
- So another milestone today.
- Yeah.
1144
00:50:54.179 --> 00:50:58.850
There was a certain point
in late January of 2018
1145
00:50:58.850 --> 00:51:01.853
where a lot of decisions
1146
00:51:01.853 --> 00:51:05.482
started to get made by Ted.
1147
00:51:05.482 --> 00:51:09.486
And I could see these
components coming together.
1148
00:51:09.486 --> 00:51:11.154
MoviePass,
within the next 60 days,
1149
00:51:11.154 --> 00:51:13.156
should be self-sufficient
on its own.
1150
00:51:13.156 --> 00:51:15.283
- Wait. 60 days...
- Yes.
1151
00:51:15.283 --> 00:51:17.369
It's going
to be cash-flow neutral?
1152
00:51:17.369 --> 00:51:19.079
Yeah, like, self-sufficient,
1153
00:51:19.079 --> 00:51:20.830
where they're not going
through cash burn.
1154
00:51:20.830 --> 00:51:23.792
[upbeat rock music]
1155
00:51:23.792 --> 00:51:27.379
♪ ♪
1156
00:51:34.094 --> 00:51:35.720
We understood
the business strategy.
1157
00:51:35.720 --> 00:51:37.681
We're going to be able
to set up technologies.
1158
00:51:37.681 --> 00:51:39.808
We're going to be able to do
all these other things.
1159
00:51:39.808 --> 00:51:42.394
We have all of this data from
the consumers that we can use.
1160
00:51:42.394 --> 00:51:43.895
All we had to do was sit back
1161
00:51:43.895 --> 00:51:45.563
and explain the story
to the media.
1162
00:51:45.563 --> 00:51:47.399
And that was
a really great place to be.
1163
00:51:47.399 --> 00:51:50.235
- The idea of selling data--
- We're the only ones--
1164
00:51:50.235 --> 00:51:52.195
Have you been able to sell
any of the data yet?
1165
00:51:52.195 --> 00:51:53.238
- Oh, yes.
- You have?
1166
00:51:53.238 --> 00:51:57.409
Yeah, we've already signed
agreements with studios.
1167
00:51:57.409 --> 00:52:00.036
♪ ♪
1168
00:52:00.036 --> 00:52:02.163
We're investing in building
1169
00:52:02.163 --> 00:52:04.874
a huge subscriber base.
1170
00:52:04.874 --> 00:52:07.252
People are seeing films
they never would have seen...
1171
00:52:07.252 --> 00:52:09.337
- Right.
- Without a MoviePass card.
1172
00:52:09.337 --> 00:52:12.757
We're buying sometimes
20% of all the movie tickets
1173
00:52:12.757 --> 00:52:14.759
in the United States.
1174
00:52:14.759 --> 00:52:19.431
The media was trying to grok
the economics of this.
1175
00:52:19.431 --> 00:52:21.933
All they could see
was an inherent loss
1176
00:52:21.933 --> 00:52:23.476
with every transaction.
1177
00:52:23.476 --> 00:52:25.603
You have everybody
all over the industry saying,
1178
00:52:25.603 --> 00:52:27.439
your business model
doesn't work.
1179
00:52:27.439 --> 00:52:28.356
Correct.
1180
00:52:28.356 --> 00:52:31.234
So why does it work?
1181
00:52:31.234 --> 00:52:32.902
Oh, you want me to explain?
1182
00:52:32.902 --> 00:52:34.571
Why the business model
does work, yeah.
1183
00:52:34.571 --> 00:52:36.781
It had a disconnect
on how that data
1184
00:52:36.781 --> 00:52:39.993
would be used downstream
to really bring in the revenue.
1185
00:52:39.993 --> 00:52:42.495
We have figured out a way
to give people
1186
00:52:42.495 --> 00:52:45.999
a deal they cannot believe
we can even afford to give.
1187
00:52:45.999 --> 00:52:49.753
- Yeah, 'cause you lose money.
- Yeah--No, we actually don't.
1188
00:52:49.753 --> 00:52:51.463
How do you not lose money?
1189
00:52:53.715 --> 00:52:57.218
I was really--I was
a believer in the mission.
1190
00:52:57.218 --> 00:52:59.888
I believed in the vision.
1191
00:52:59.888 --> 00:53:01.431
You know,
you invented this...
1192
00:53:01.431 --> 00:53:06.227
Mitch and Ted were doing
a lot of TV-show interviews.
1193
00:53:06.227 --> 00:53:07.645
And I felt like--
1194
00:53:07.645 --> 00:53:11.775
you know how sometimes
somebody is trying to...
1195
00:53:11.775 --> 00:53:14.778
prove that they're confident?
1196
00:53:14.778 --> 00:53:17.572
I almost kind of was like,
okay, go ahead.
1197
00:53:17.572 --> 00:53:18.656
Feel yourself.
1198
00:53:18.656 --> 00:53:20.408
You're the chairman
of MoviePass.
1199
00:53:20.408 --> 00:53:21.701
It's an enormously huge idea.
1200
00:53:21.701 --> 00:53:24.162
Any movie, any theater,
any day--that was me.
1201
00:53:24.162 --> 00:53:26.247
That's what I created.
- [chuckles]
1202
00:53:26.247 --> 00:53:29.459
[upbeat music]
1203
00:53:29.459 --> 00:53:31.628
♪ ♪
1204
00:53:31.628 --> 00:53:34.506
We were
at Sundance Film Festival.
1205
00:53:35.757 --> 00:53:37.342
Ted became enamored
1206
00:53:37.342 --> 00:53:40.595
by this whole business
of entertainment.
1207
00:53:40.595 --> 00:53:44.849
Khalid introduced him
to a number of people
1208
00:53:44.849 --> 00:53:47.018
and the potential
1209
00:53:47.018 --> 00:53:50.730
between MoviePass
and filmmaking.
1210
00:53:50.730 --> 00:53:52.649
They rented probably--
1211
00:53:52.649 --> 00:53:55.902
it had to be
a $50 million mansion.
1212
00:53:57.320 --> 00:54:00.573
Everybody was wilin' out,
dancin', celebratin',
1213
00:54:00.573 --> 00:54:03.410
and just really kissing
the ass of everybody
1214
00:54:03.410 --> 00:54:05.370
that worked at MoviePass,
1215
00:54:05.370 --> 00:54:08.081
because they all assumed,
like I did,
1216
00:54:08.081 --> 00:54:09.708
that they were just
the next big thing.
1217
00:54:09.708 --> 00:54:12.085
Like, they were the ones
to get involved with.
1218
00:54:12.085 --> 00:54:14.713
After they made such
a name for themself,
1219
00:54:14.713 --> 00:54:18.008
everything was possible
at that point--everything.
1220
00:54:18.008 --> 00:54:24.723
♪ ♪
1221
00:54:28.184 --> 00:54:30.270
I had heard a little bit
about MoviePass
1222
00:54:30.270 --> 00:54:31.938
within the past couple months
just on media,
1223
00:54:31.938 --> 00:54:34.024
whatever it may have been.
[camera shutter clicking]
1224
00:54:34.024 --> 00:54:38.361
I was fully engulfed in
my social-media influencing.
1225
00:54:38.361 --> 00:54:42.532
And Bob Ellis had called me
basically out of the blue.
1226
00:54:42.532 --> 00:54:44.743
I'm doing this event
with MoviePass.
1227
00:54:44.743 --> 00:54:47.746
We need you.
We want you to do merchandise.
1228
00:54:47.746 --> 00:54:50.290
You're going to fly in.
We have VIP tickets for you.
1229
00:54:50.290 --> 00:54:51.624
You're going to go
to this party,
1230
00:54:51.624 --> 00:54:53.460
and then you're also going
to go to Coachella.
1231
00:54:53.460 --> 00:54:55.962
It was three days
prior to the event.
1232
00:54:55.962 --> 00:54:58.923
[electronic music]
1233
00:54:58.923 --> 00:55:01.092
♪ ♪
1234
00:55:01.092 --> 00:55:02.802
And Dennis Rodman showed up.
1235
00:55:02.802 --> 00:55:05.430
I didn't know
who Dennis Rodman was.
1236
00:55:05.430 --> 00:55:08.600
He's tall. I'm short.
This is hilarious.
1237
00:55:08.600 --> 00:55:11.853
♪ ♪
1238
00:55:11.853 --> 00:55:14.522
I saw Dennis Rodman
1239
00:55:14.522 --> 00:55:17.859
getting out of the MoviePass
helicopter on Instagram.
1240
00:55:17.859 --> 00:55:18.818
[chuckles]
1241
00:55:18.818 --> 00:55:21.196
It is dry
as a motherfucker, all right?
1242
00:55:21.196 --> 00:55:23.114
And he was walking
all around,
1243
00:55:23.114 --> 00:55:25.575
telling people
about MoviePass.
1244
00:55:25.575 --> 00:55:27.911
We were just all like, what?
1245
00:55:27.911 --> 00:55:29.621
$20 million,
what they're spending here.
1246
00:55:29.621 --> 00:55:31.289
I don't even know
what they were doing,
1247
00:55:31.289 --> 00:55:32.707
but what I was told was,
1248
00:55:32.707 --> 00:55:34.626
make Dennis Rodman
wear this merchandise.
1249
00:55:34.626 --> 00:55:36.795
Got to thank these guys
here, MoviePass.
1250
00:55:36.795 --> 00:55:40.465
For Coachella,
it was Khalid thinking,
1251
00:55:40.465 --> 00:55:42.592
this is a great way
to get our name out there.
1252
00:55:42.592 --> 00:55:44.969
The entire Coachella thing
was just weird.
1253
00:55:44.969 --> 00:55:48.390
I mean, what's going on?
Why is this happening?
1254
00:55:48.390 --> 00:55:50.308
It was just kind of
like, what the fuck?
1255
00:55:50.308 --> 00:55:52.477
Where did we get money
for that?
1256
00:55:52.477 --> 00:55:57.148
Ted and his crew did like
to post pictures
1257
00:55:57.148 --> 00:55:58.733
of them having a good time.
1258
00:55:58.733 --> 00:56:02.028
♪ ♪
1259
00:56:02.028 --> 00:56:05.115
I don't understand
why we were even at Coachella
1260
00:56:05.115 --> 00:56:07.826
as a movie company.
1261
00:56:09.077 --> 00:56:11.788
Staff on Ted's side--
1262
00:56:11.788 --> 00:56:14.457
they're really enjoying
the ride.
1263
00:56:14.457 --> 00:56:18.003
And people
were back at the office
1264
00:56:18.003 --> 00:56:20.547
trying to figure out
customer-service issues
1265
00:56:20.547 --> 00:56:22.799
or why somebody
wouldn't get their card.
1266
00:56:24.342 --> 00:56:26.219
At the time,
it was super backed up.
1267
00:56:26.219 --> 00:56:28.179
There were hundreds
of thousands
1268
00:56:28.179 --> 00:56:29.514
of customer-service tickets
1269
00:56:29.514 --> 00:56:31.516
and, like, seven people
answering them.
1270
00:56:31.516 --> 00:56:34.394
You remember that?
The Coachella party?
1271
00:56:36.771 --> 00:56:39.482
Do you think they invited us,
the customer support,
1272
00:56:39.482 --> 00:56:41.943
or just anyone who wasn't
upper management to Coachella?
1273
00:56:41.943 --> 00:56:43.445
No, they didn't.
1274
00:56:43.445 --> 00:56:46.364
I sensed a resentment
1275
00:56:46.364 --> 00:56:49.325
by the MoviePass employees.
1276
00:56:49.325 --> 00:56:52.203
Each individual
has their various roles,
1277
00:56:52.203 --> 00:56:54.998
and not all roles get to party.
1278
00:56:57.375 --> 00:57:00.420
They had spent
over a million dollars.
1279
00:57:00.420 --> 00:57:03.340
Meanwhile,
there weren't extension cords
1280
00:57:03.340 --> 00:57:05.383
to plug our computers into.
1281
00:57:05.383 --> 00:57:07.385
I still have to go next door
to the bank
1282
00:57:07.385 --> 00:57:09.137
to borrow pens
or whatever, you know?
1283
00:57:09.137 --> 00:57:10.889
Like, it was insane.
1284
00:57:10.889 --> 00:57:14.559
Mitch and Ted started
to develop plans.
1285
00:57:14.559 --> 00:57:17.937
Some of them were logical,
1286
00:57:17.937 --> 00:57:21.608
in that they wanted to promote
the service,
1287
00:57:21.608 --> 00:57:24.861
but they became illogical
and irrational
1288
00:57:24.861 --> 00:57:27.405
as it relates
to the way the business
1289
00:57:27.405 --> 00:57:29.366
was going to finance itself.
1290
00:57:29.366 --> 00:57:32.577
And that's the thing
that became very tricky.
1291
00:57:32.577 --> 00:57:35.580
Ted became all excited,
telling me,
1292
00:57:35.580 --> 00:57:37.290
hey, we're going
to do this film.
1293
00:57:37.290 --> 00:57:39.292
John Travolta
is attached to it.
1294
00:57:39.292 --> 00:57:41.378
And Ted said, yeah,
and I'm going to put
1295
00:57:41.378 --> 00:57:43.213
your name on as a producer.
1296
00:57:43.213 --> 00:57:45.590
And, okay.
1297
00:57:45.590 --> 00:57:49.636
For me, it was just a film
that made sense
1298
00:57:49.636 --> 00:57:52.514
that we could promote
and earn money from.
1299
00:57:54.641 --> 00:57:56.142
Let me tell you something.
1300
00:57:56.142 --> 00:57:57.894
"Gotti" opening weekend--
1301
00:57:57.894 --> 00:58:01.356
it's got the dreaded
0% Rotten Tomatoes score.
1302
00:58:01.356 --> 00:58:03.274
Not a single person
who reviewed it
1303
00:58:03.274 --> 00:58:04.901
gave it a positive score.
1304
00:58:04.901 --> 00:58:07.278
- That's a goddamn lie!
- Order!
1305
00:58:07.278 --> 00:58:10.615
Gotti, they're lying!
She's lying!
1306
00:58:10.615 --> 00:58:12.450
There were, like,
these weird, little, like,
1307
00:58:12.450 --> 00:58:13.785
cockamamie schemes,
1308
00:58:13.785 --> 00:58:16.329
where they thought,
oh, we can generate money.
1309
00:58:16.329 --> 00:58:18.081
And I don't think
anybody could figure out
1310
00:58:18.081 --> 00:58:21.668
how this was supposed to work,
this $9 a month.
1311
00:58:21.668 --> 00:58:23.628
People were asking me,
how do you think it worked?
1312
00:58:23.628 --> 00:58:27.048
Like, you know, what's
the Coke secret formula?
1313
00:58:27.048 --> 00:58:30.677
And I was like, I don't know--
something with concessions?
1314
00:58:30.677 --> 00:58:33.805
That's the only thing
that I could think of.
1315
00:58:36.558 --> 00:58:38.435
The first MoviePass story
I wrote
1316
00:58:38.435 --> 00:58:39.936
that was of major significance
1317
00:58:39.936 --> 00:58:42.272
was when they had
their 10-K filing.
1318
00:58:42.272 --> 00:58:45.108
[applause]
1319
00:58:45.108 --> 00:58:48.445
Because MoviePass's parent
company, Helios and Matheson,
1320
00:58:48.445 --> 00:58:50.780
was a publicly traded company,
1321
00:58:50.780 --> 00:58:55.160
they have to file things
that you can see publicly.
1322
00:58:55.160 --> 00:58:57.203
They had their 10-K filing--
1323
00:58:57.203 --> 00:58:59.622
when a company needs
to kind of, like, assess
1324
00:58:59.622 --> 00:59:01.499
where they're going.
1325
00:59:01.499 --> 00:59:04.377
It revealed that in 2017,
1326
00:59:04.377 --> 00:59:09.174
they lost, like,
over $150 million.
1327
00:59:09.174 --> 00:59:11.259
When I was CEO,
1328
00:59:11.259 --> 00:59:14.262
we lost around $200,000
a month.
1329
00:59:14.262 --> 00:59:15.847
When they were running
the company,
1330
00:59:15.847 --> 00:59:17.766
they lost $30 million a month.
1331
00:59:17.766 --> 00:59:20.143
I wish we had access
to those reports
1332
00:59:20.143 --> 00:59:21.728
before they went out--
1333
00:59:21.728 --> 00:59:24.522
when the 10-K was released
1334
00:59:24.522 --> 00:59:26.107
and they were seeing
1335
00:59:26.107 --> 00:59:27.525
this hemorrhage.
1336
00:59:27.525 --> 00:59:29.527
I primarily invest
in small companies
1337
00:59:29.527 --> 00:59:31.529
and help build businesses
as a venture capitalist.
1338
00:59:31.529 --> 00:59:35.367
If you read the 10-K
of this company...
1339
00:59:35.367 --> 00:59:37.410
which I did,
1340
00:59:37.410 --> 00:59:40.622
it is an endless list of...
1341
00:59:40.622 --> 00:59:43.416
oh, my God,
what is happening here?
1342
00:59:43.416 --> 00:59:44.709
There wasn't any sense
1343
00:59:44.709 --> 00:59:46.753
that the financial situation
would improve.
1344
00:59:46.753 --> 00:59:48.838
And that would mean
they would just keep having
1345
00:59:48.838 --> 00:59:50.757
to go out and find hundreds
and hundreds
1346
00:59:50.757 --> 00:59:52.550
of millions of dollars
1347
00:59:52.550 --> 00:59:56.054
to continue to float
their company.
1348
00:59:56.054 --> 00:59:58.556
The investors started
getting nervous.
1349
00:59:58.556 --> 01:00:02.102
All they saw was money
going out the door--
1350
01:00:02.102 --> 01:00:03.395
millions every month.
1351
01:00:03.395 --> 01:00:05.814
Their stock plummeted.
1352
01:00:07.607 --> 01:00:11.361
Me writing about that
really set things going
1353
01:00:11.361 --> 01:00:14.739
of people realizing
that maybe things aren't going
1354
01:00:14.739 --> 01:00:17.659
as well at MoviePass
as many of us thought.
1355
01:00:17.659 --> 01:00:20.245
[ominous music]
1356
01:00:20.245 --> 01:00:24.499
One day, I was just googling
Ted Farnsworth.
1357
01:00:24.499 --> 01:00:26.084
What you're about
to learn today
1358
01:00:26.084 --> 01:00:27.877
is how you can travel
around the world
1359
01:00:27.877 --> 01:00:29.421
for pennies on the dollar...
1360
01:00:29.421 --> 01:00:31.339
I was really down
a rabbit hole,
1361
01:00:31.339 --> 01:00:33.758
looking at videos I've seen of
him from a lot of companies.
1362
01:00:33.758 --> 01:00:36.386
Ready to go, lock in
your freedom, lock in...
1363
01:00:36.386 --> 01:00:38.847
And I kept seeing
these articles
1364
01:00:38.847 --> 01:00:41.266
all built
around a defense of Ted.
1365
01:00:41.266 --> 01:00:43.435
"Ted Farnsworth may seem
like a scam artist,
1366
01:00:43.435 --> 01:00:44.644
but he's actually not."
1367
01:00:44.644 --> 01:00:46.104
"Anyone can say
he's a scam artist,
1368
01:00:46.104 --> 01:00:48.773
but he's really, like,
a great businessman."
1369
01:00:48.773 --> 01:00:51.234
They were all using
similar language.
1370
01:00:51.234 --> 01:00:53.111
And I was just struck by,
1371
01:00:53.111 --> 01:00:55.488
God, like, someone's
got to be paying for these.
1372
01:00:55.488 --> 01:00:58.950
Like, this is
such a ham-fisted strategy
1373
01:00:58.950 --> 01:01:02.954
to try to improve
your public image.
1374
01:01:02.954 --> 01:01:05.373
I mean, he doesn't
necessarily come across
1375
01:01:05.373 --> 01:01:08.001
as a very...
1376
01:01:08.001 --> 01:01:11.129
I should say, traditionally
sophisticated businessperson.
1377
01:01:11.129 --> 01:01:12.964
You're making money
while you're sleeping.
1378
01:01:12.964 --> 01:01:14.632
I always tell people
when they sit there
1379
01:01:14.632 --> 01:01:16.092
and they're having lunch
with somebody,
1380
01:01:16.092 --> 01:01:17.886
they could be saying,
I'm making money right now.
1381
01:01:17.886 --> 01:01:21.598
He's gotten
into the energy-drink game,
1382
01:01:21.598 --> 01:01:22.974
the farming game.
1383
01:01:22.974 --> 01:01:25.518
Hello, I'm Latoya Jackson.
1384
01:01:25.518 --> 01:01:27.812
If you have any questions
about your future,
1385
01:01:27.812 --> 01:01:30.857
now you can call your own
personal psychic anytime.
1386
01:01:30.857 --> 01:01:35.236
Starting a psychic hotline
with Latoya Jackson.
1387
01:01:35.236 --> 01:01:36.696
He's a chameleon.
1388
01:01:36.696 --> 01:01:39.532
I do want to ask about
how your biometrics works.
1389
01:01:39.532 --> 01:01:41.242
So it's three points
of the face
1390
01:01:41.242 --> 01:01:42.619
and a mathematical formula.
1391
01:01:42.619 --> 01:01:44.704
That's really
the big differentiation
1392
01:01:44.704 --> 01:01:47.082
between us and any other
facial-recognition company
1393
01:01:47.082 --> 01:01:48.124
out there.
1394
01:01:48.124 --> 01:01:51.753
Suddenly,
he was a movie exec.
1395
01:01:51.753 --> 01:01:54.756
I just was baffled.
1396
01:01:54.756 --> 01:01:57.634
Who is Ted Farnsworth?
1397
01:01:57.634 --> 01:02:00.762
Ted never shared
his master plan with me,
1398
01:02:00.762 --> 01:02:02.889
but every single Monday,
1399
01:02:02.889 --> 01:02:06.267
we needed more money
than the previous week.
1400
01:02:06.267 --> 01:02:09.437
And I had no idea
how we were going to get it.
1401
01:02:09.437 --> 01:02:13.191
I would go to Ted and said,
How long can this go on?
1402
01:02:13.191 --> 01:02:17.445
And he said, just keep going,
and the money will come.
1403
01:02:17.445 --> 01:02:20.865
♪ ♪
1404
01:02:20.865 --> 01:02:23.034
When they were losing
all this money,
1405
01:02:23.034 --> 01:02:26.246
Ted was also trying to start
a plane company.
1406
01:02:26.246 --> 01:02:29.082
♪ ♪
1407
01:02:29.082 --> 01:02:31.543
We have a hemorrhage going
on in your business model.
1408
01:02:31.543 --> 01:02:34.963
And now John Travolta's plane
has a MoviePass logo on it?
1409
01:02:34.963 --> 01:02:38.091
And he calls
it MoviePass Air.
1410
01:02:38.091 --> 01:02:41.386
Yes, it's called
MoviePass Air.
1411
01:02:41.386 --> 01:02:44.597
I saw that crazy spending,
1412
01:02:44.597 --> 01:02:46.975
and I was just shaking
my head.
1413
01:02:46.975 --> 01:02:49.310
I was just like, oh, gosh.
1414
01:02:49.310 --> 01:02:51.521
Please, like...
1415
01:02:51.521 --> 01:02:54.733
let them know something
I don't know.
1416
01:02:54.733 --> 01:02:56.568
All right, MoviePass
is fucking awesome.
1417
01:02:56.568 --> 01:02:58.570
And welcome 50 fucking Cent!
1418
01:02:58.570 --> 01:03:00.030
[cheers and applause]
1419
01:03:00.030 --> 01:03:01.990
Ted just wanted
to go to parties
1420
01:03:01.990 --> 01:03:03.116
and hang out
with Hollywood stars.
1421
01:03:03.116 --> 01:03:05.326
Make some noise for 50 Cent!
1422
01:03:05.326 --> 01:03:08.747
Go! Go! Go! Go! Go! Go!
1423
01:03:08.747 --> 01:03:10.123
There was
no branding strategy
1424
01:03:10.123 --> 01:03:14.169
for Ted to be involved
in hobnobbing with Hollywood.
1425
01:03:18.506 --> 01:03:21.092
I started getting
reached out from people
1426
01:03:21.092 --> 01:03:23.595
who actually work
at MoviePass.
1427
01:03:23.595 --> 01:03:24.929
There were some people
1428
01:03:24.929 --> 01:03:27.098
that would send me recordings
of meetings.
1429
01:03:41.154 --> 01:03:43.198
We would have big meetings.
1430
01:03:43.198 --> 01:03:45.700
I remember Mitch telling us,
everything's great.
1431
01:03:45.700 --> 01:03:46.993
Everything's great.
1432
01:03:46.993 --> 01:03:49.245
You know,
everything's going to plan.
1433
01:03:54.668 --> 01:03:57.921
I was focused
on trying to save it,
1434
01:03:57.921 --> 01:04:02.133
trying to find some solution,
a different model.
1435
01:04:02.133 --> 01:04:04.177
In an attempt
to stop the money loss,
1436
01:04:04.177 --> 01:04:07.347
MoviePass was changing
their terms of service daily.
1437
01:04:07.347 --> 01:04:08.723
Changes continue
1438
01:04:08.723 --> 01:04:10.308
for the troubled
film-subscription service.
1439
01:04:10.308 --> 01:04:11.643
MoviePass announcing
more changes.
1440
01:04:11.643 --> 01:04:14.646
The subscription-based company
will now only allow users
1441
01:04:14.646 --> 01:04:16.773
to choose
from six movies a day
1442
01:04:16.773 --> 01:04:18.858
and see a total
of three movies per month.
1443
01:04:18.858 --> 01:04:20.819
You can't use it
on Memorial Day Weekend,
1444
01:04:20.819 --> 01:04:22.904
but you can use it
during these windows here.
1445
01:04:22.904 --> 01:04:24.322
A little shady.
1446
01:04:24.322 --> 01:04:26.991
A lot of people are probably
not happy about this.
1447
01:04:26.991 --> 01:04:29.994
We implemented
a ticket-verification thing.
1448
01:04:29.994 --> 01:04:31.287
Next time you go into the app,
1449
01:04:31.287 --> 01:04:33.164
if you want to see
another one,
1450
01:04:33.164 --> 01:04:35.083
you have to upload the stub,
take a picture of it.
1451
01:04:35.083 --> 01:04:38.294
We were trying to find out
ways to not bleed out cash.
1452
01:04:38.294 --> 01:04:40.463
The type of images people
were supposed to send
1453
01:04:40.463 --> 01:04:44.175
were their actual
ticket stubs, but...
1454
01:04:44.175 --> 01:04:46.469
I've definitely sent
MoviePass a picture
1455
01:04:46.469 --> 01:04:48.430
of my middle finger before.
1456
01:04:48.430 --> 01:04:51.975
It became clear
that we were not able
1457
01:04:51.975 --> 01:04:54.310
to provide any solutions
to people
1458
01:04:54.310 --> 01:04:57.731
with the state of the app
as it was.
1459
01:04:57.731 --> 01:05:00.191
It simply was not working.
1460
01:05:00.191 --> 01:05:02.902
So there was very little that
we could do to help people,
1461
01:05:02.902 --> 01:05:05.405
which is really frustrating
when that's your job.
1462
01:05:05.405 --> 01:05:08.575
It just felt like chaos.
1463
01:05:08.575 --> 01:05:11.077
Summer of 2018
was when MoviePass
1464
01:05:11.077 --> 01:05:12.954
started to really hit
a fever pitch
1465
01:05:12.954 --> 01:05:14.956
in terms of popularity.
1466
01:05:14.956 --> 01:05:18.126
[suspenseful music]
1467
01:05:18.126 --> 01:05:21.921
♪ ♪
1468
01:05:21.921 --> 01:05:23.798
That "Mission: Impossible"
film--
1469
01:05:23.798 --> 01:05:26.009
I remember it being promoted,
1470
01:05:26.009 --> 01:05:29.387
or they had emails actually
encouraging members to go.
1471
01:05:29.387 --> 01:05:31.306
When "Mission: Impossible--
Fallout" came out,
1472
01:05:31.306 --> 01:05:33.433
we started hearing
from customers
1473
01:05:33.433 --> 01:05:36.728
that the service
was not working at all.
1474
01:05:36.728 --> 01:05:38.688
I've ruined your day,
haven't I?
1475
01:05:38.688 --> 01:05:41.024
When I check
the MoviePass today,
1476
01:05:41.024 --> 01:05:43.318
let me show you guys
what I see.
1477
01:05:43.318 --> 01:05:45.445
"Mission: Impossible--
Fallout,"
1478
01:05:45.445 --> 01:05:46.738
I haven't seen that.
1479
01:05:46.738 --> 01:05:48.782
There were already signs
1480
01:05:48.782 --> 01:05:51.242
that there were
some technical issues
1481
01:05:51.242 --> 01:05:54.120
with being able to fulfill
the promise
1482
01:05:54.120 --> 01:05:55.914
that MoviePass had.
1483
01:05:55.914 --> 01:05:59.209
But I noticed
with "Mission: Impossible,"
1484
01:05:59.209 --> 01:06:01.252
it felt like a national issue.
1485
01:06:01.252 --> 01:06:04.422
It's just the discussion
surrounding that movie,
1486
01:06:04.422 --> 01:06:06.800
I recall, was vitriolic.
1487
01:06:06.800 --> 01:06:08.593
[chuckles]
1488
01:06:08.593 --> 01:06:10.679
We're right here
at this theater, right here,
1489
01:06:10.679 --> 01:06:13.473
and they just opened--
no screenings at this theater.
1490
01:06:13.473 --> 01:06:15.767
I might as well start a fire
and try and send
1491
01:06:15.767 --> 01:06:17.143
customer service
smoke signals.
1492
01:06:17.143 --> 01:06:19.521
They're more likely to answer
that than their phone
1493
01:06:19.521 --> 01:06:21.564
or the email that I sent.
1494
01:06:21.564 --> 01:06:23.274
We did get a lot
of hate mail, I remember.
1495
01:06:23.274 --> 01:06:24.943
We had stacks of hate mail.
1496
01:06:24.943 --> 01:06:26.986
It got so bad
that, apparently,
1497
01:06:26.986 --> 01:06:31.366
a customer literally sent
a box of shit to the office.
1498
01:06:31.366 --> 01:06:32.450
I get it.
1499
01:06:32.450 --> 01:06:34.786
Like, I mean, I wouldn't send
no shit to a company
1500
01:06:34.786 --> 01:06:36.579
if they were doing
me wrong, but...
1501
01:06:36.579 --> 01:06:37.664
wow.
1502
01:06:37.664 --> 01:06:40.792
A lot of these things
were during a period of time
1503
01:06:40.792 --> 01:06:42.293
that I was--
1504
01:06:42.293 --> 01:06:44.629
You know, I was
in the middle of a divorce
1505
01:06:44.629 --> 01:06:48.800
after 40 years of being
with my former wife.
1506
01:06:48.800 --> 01:06:50.802
I was totally distracted.
1507
01:06:50.802 --> 01:06:55.265
So, without a specific amount
of time,
1508
01:06:55.265 --> 01:06:58.393
I just thought, you know,
this would be a good time
1509
01:06:58.393 --> 01:07:03.356
for me to take off
and let Khalid take over.
1510
01:07:03.356 --> 01:07:05.984
Mitch was still CEO,
but Khalid Itum was running
1511
01:07:05.984 --> 01:07:08.153
the day-to-day operations.
1512
01:07:14.159 --> 01:07:17.078
I'm sure you're aware
of Khalid, right?
1513
01:07:24.836 --> 01:07:26.838
You know, honestly, I don't
even remember his role.
1514
01:07:26.838 --> 01:07:28.340
I just know he went
from one role,
1515
01:07:28.340 --> 01:07:29.549
and then next thing you know,
1516
01:07:29.549 --> 01:07:31.676
he was senior vice president
of that role.
1517
01:07:31.676 --> 01:07:33.053
And then next thing you know,
1518
01:07:33.053 --> 01:07:35.096
he was, like, pretty much
running the show.
1519
01:07:36.431 --> 01:07:38.266
While Mitch took off
to Mexico
1520
01:07:38.266 --> 01:07:39.976
in the wake of his divorce,
1521
01:07:39.976 --> 01:07:41.519
Ted is living his best life.
1522
01:07:41.519 --> 01:07:44.439
[easygoing music]
1523
01:07:44.439 --> 01:07:47.984
♪ ♪
1524
01:07:47.984 --> 01:07:52.030
There was a picture
on my manager's IG
1525
01:07:52.030 --> 01:07:54.574
of them partying it up
on a yacht.
1526
01:07:54.574 --> 01:07:58.036
♪ ♪
1527
01:07:58.036 --> 01:08:00.497
And then he put this picture
on private.
1528
01:08:00.497 --> 01:08:02.624
I'm like, it's too late.
1529
01:08:02.624 --> 01:08:06.336
People within the company
were beginning to realize,
1530
01:08:06.336 --> 01:08:08.046
there was not going to be
a happy ending to this.
1531
01:08:08.046 --> 01:08:10.006
[indistinct shouting]
1532
01:08:10.006 --> 01:08:12.217
It's like that moment
in "Titanic"
1533
01:08:12.217 --> 01:08:15.553
when the band
is still on the boat
1534
01:08:15.553 --> 01:08:19.224
while it's going down,
but they won't leave the ship.
1535
01:08:19.224 --> 01:08:21.017
Shares of Helios and Matheson
1536
01:08:21.017 --> 01:08:24.229
have plunged 90%
so far this year.
1537
01:08:24.229 --> 01:08:26.147
Shares peaked
at the equivalent
1538
01:08:26.147 --> 01:08:29.275
of more than $8,000 a share.
1539
01:08:29.275 --> 01:08:32.320
Right now it's trading
between one and two cents.
1540
01:08:32.320 --> 01:08:34.197
I desperately went to Ted
and said,
1541
01:08:34.197 --> 01:08:37.701
we need a minimum
of $5 million.
1542
01:08:37.701 --> 01:08:40.787
Ted said, I'm sorry, we can't
come up with the money.
1543
01:08:40.787 --> 01:08:43.748
[somber music]
1544
01:08:43.748 --> 01:08:45.250
♪ ♪
1545
01:08:45.250 --> 01:08:47.711
Well, subscription
movie-ticket company MoviePass
1546
01:08:47.711 --> 01:08:50.755
announcing it will shut down.
1547
01:08:50.755 --> 01:08:53.883
It was a bit of a bummer
that this good thing
1548
01:08:53.883 --> 01:08:55.427
had to come to an end
1549
01:08:55.427 --> 01:08:58.722
for everybody
that really saw the vision.
1550
01:08:58.722 --> 01:09:01.099
♪ ♪
1551
01:09:01.099 --> 01:09:03.893
Eventually both HMNY
and MoviePass
1552
01:09:03.893 --> 01:09:06.479
declared bankruptcy.
1553
01:09:06.479 --> 01:09:08.857
It took Stacy over a decade
to create MoviePass
1554
01:09:08.857 --> 01:09:10.233
and less than a year
1555
01:09:10.233 --> 01:09:12.736
for Mitch and Ted
to drive it into the ground.
1556
01:09:15.613 --> 01:09:16.990
Ah...
1557
01:09:16.990 --> 01:09:19.701
♪ ♪
1558
01:09:19.701 --> 01:09:22.370
I think the hardest part--
1559
01:09:22.370 --> 01:09:25.832
I think if we had failed--
1560
01:09:25.832 --> 01:09:29.794
and I use the collective "we"
of the MoviePass team
1561
01:09:29.794 --> 01:09:31.588
We tried a product,
1562
01:09:31.588 --> 01:09:34.257
it didn't succeed
in the market,
1563
01:09:34.257 --> 01:09:36.968
and we just failed.
1564
01:09:36.968 --> 01:09:39.054
I think I could have lived
with that.
1565
01:09:39.054 --> 01:09:42.057
But what was hard
about what had happened was,
1566
01:09:42.057 --> 01:09:44.017
we had succeeded.
1567
01:09:44.017 --> 01:09:46.311
We had built a brand
over years.
1568
01:09:46.311 --> 01:09:49.314
The brand had enormous value
in the marketplace.
1569
01:09:49.314 --> 01:09:51.566
We were disrupting
the movie industry.
1570
01:09:51.566 --> 01:09:55.278
We were changing everything,
and it worked.
1571
01:09:55.278 --> 01:09:58.490
And that made it harder.
1572
01:09:58.490 --> 01:10:01.826
But I think losing
all that money was...
1573
01:10:01.826 --> 01:10:03.119
[groans]
1574
01:10:03.119 --> 01:10:06.331
It's very disappointing.
1575
01:10:06.331 --> 01:10:09.626
You work more than a decade
on something.
1576
01:10:09.626 --> 01:10:13.338
You summit Everest.
You literally make it.
1577
01:10:13.338 --> 01:10:17.342
And then it's gone
within the amount of time
1578
01:10:17.342 --> 01:10:20.595
that you as a founder
can't sell your stock.
1579
01:10:20.595 --> 01:10:22.347
It just vanished.
1580
01:10:22.347 --> 01:10:25.225
By the time MoviePass was
no more,
1581
01:10:25.225 --> 01:10:27.727
the stock value,
around $80 million,
1582
01:10:27.727 --> 01:10:31.356
that Hamet and I had
was worth pennies.
1583
01:10:31.356 --> 01:10:33.108
It's a pain
to have to explain
1584
01:10:33.108 --> 01:10:34.359
the MoviePass situation,
1585
01:10:34.359 --> 01:10:36.194
'cause when it was
in the news, like,
1586
01:10:36.194 --> 01:10:37.696
I had to explain that
to everyone
1587
01:10:37.696 --> 01:10:39.823
that I interacted with
on the business side,
1588
01:10:39.823 --> 01:10:41.783
and that's not fun.
1589
01:10:41.783 --> 01:10:43.868
And the only thing
I could say is, like, look,
1590
01:10:43.868 --> 01:10:45.620
we exited the business,
1591
01:10:45.620 --> 01:10:49.582
and the new team took it
in a direction that--
1592
01:10:49.582 --> 01:10:51.418
took it
in various directions, right?
1593
01:10:51.418 --> 01:10:54.212
I had to be fairly neutral
around that.
1594
01:10:54.212 --> 01:10:56.089
I was not talking
to Ted at all.
1595
01:10:56.089 --> 01:10:58.758
I knew from the beginning
that Ted and I did not have
1596
01:10:58.758 --> 01:11:00.135
the same values,
1597
01:11:00.135 --> 01:11:02.220
but Mitch did say,
I apologize.
1598
01:11:02.220 --> 01:11:05.932
Like, I remember him
apologizing...
1599
01:11:05.932 --> 01:11:08.184
which I was glad he did,
1600
01:11:08.184 --> 01:11:11.438
but it didn't solve the pain.
1601
01:11:11.438 --> 01:11:14.315
It was 10 years
after we launched Netflix
1602
01:11:14.315 --> 01:11:16.151
that streaming first began.
1603
01:11:16.151 --> 01:11:18.528
Mitch loves
to pump up himself
1604
01:11:18.528 --> 01:11:20.572
as this great disruptor,
1605
01:11:20.572 --> 01:11:23.283
but it was clear for people
who worked at MoviePass
1606
01:11:23.283 --> 01:11:25.201
that this guy
was not the answer.
1607
01:11:25.201 --> 01:11:27.162
Mitch's history,
as I found out more,
1608
01:11:27.162 --> 01:11:29.289
was spottier than
he would have represented.
1609
01:11:29.289 --> 01:11:31.291
He would tell us
how he was one of the founders
1610
01:11:31.291 --> 01:11:32.500
of Netflix.
1611
01:11:32.500 --> 01:11:35.170
Mitch was not
a co-founder of Netflix.
1612
01:11:35.170 --> 01:11:38.048
Mitch Lowe,
in the early days of Netflix,
1613
01:11:38.048 --> 01:11:40.759
was someone who was able
to provide them
1614
01:11:40.759 --> 01:11:45.263
with loads and loads of disks,
of DVDs.
1615
01:11:45.263 --> 01:11:47.265
When Mitch came on board,
1616
01:11:47.265 --> 01:11:50.060
he had
some very strong opinions
1617
01:11:50.060 --> 01:11:53.938
and had a very...
1618
01:11:53.938 --> 01:11:57.400
non-Netflix, non-Netflix-y way
of approaching it.
1619
01:11:57.400 --> 01:12:00.111
Mitch and I got to a point
where he told me
1620
01:12:00.111 --> 01:12:01.446
that he was going to quit
1621
01:12:01.446 --> 01:12:03.782
if I didn't take
Ted's financing deal.
1622
01:12:03.782 --> 01:12:04.949
And I ultimately said,
1623
01:12:04.949 --> 01:12:06.743
well, I don't want to run
the company, I can't.
1624
01:12:06.743 --> 01:12:08.328
I've got other things
to do right now.
1625
01:12:08.328 --> 01:12:09.954
So I guess
we're going to do this.
1626
01:12:09.954 --> 01:12:12.374
You know, and that was
the beginning of the end
1627
01:12:12.374 --> 01:12:13.917
in some ways.
1628
01:12:23.301 --> 01:12:27.097
[train screeching]
1629
01:12:27.097 --> 01:12:28.848
I got a voice mail
1630
01:12:28.848 --> 01:12:32.811
from someone who said
they were from the FBI.
1631
01:12:32.811 --> 01:12:35.480
And I ended up
doing an interview with them
1632
01:12:35.480 --> 01:12:38.400
regarding investigations
that they were doing
1633
01:12:38.400 --> 01:12:41.736
on MoviePass and HMNY.
1634
01:12:43.071 --> 01:12:46.324
I was talking to
the Attorney General's Office,
1635
01:12:46.324 --> 01:12:48.993
the FBI, and the FTC.
1636
01:12:48.993 --> 01:12:51.329
It was quite nerve-racking.
1637
01:12:51.329 --> 01:12:54.833
I've never seen or done
anything like that.
1638
01:12:54.833 --> 01:12:58.169
The FTC was investigating
allegations of fraud
1639
01:12:58.169 --> 01:12:59.838
by MoviePass
against customers.
1640
01:12:59.838 --> 01:13:02.507
The deeper you got in,
the more you realized
1641
01:13:02.507 --> 01:13:05.301
all the shady dealings
that were going on.
1642
01:13:05.301 --> 01:13:07.512
Mr. Farnsworth and Mr. Lowe
1643
01:13:07.512 --> 01:13:09.472
got themselves
into a real predicament.
1644
01:13:09.472 --> 01:13:12.017
What I heard
was that Mitch Lowe
1645
01:13:12.017 --> 01:13:14.310
told his tech team
1646
01:13:14.310 --> 01:13:17.731
to block people
from using the app.
1647
01:13:19.190 --> 01:13:22.861
The subscriber didn't know
the rules had changed,
1648
01:13:22.861 --> 01:13:24.696
and that was unfair.
1649
01:13:24.696 --> 01:13:27.782
I understand needing
to get costs down,
1650
01:13:27.782 --> 01:13:30.326
but that's not
the way to do it.
1651
01:13:30.326 --> 01:13:31.911
I think there was a time
1652
01:13:31.911 --> 01:13:34.956
where MoviePass
was struggling financially,
1653
01:13:34.956 --> 01:13:38.001
where they started to do
some very questionable things
1654
01:13:38.001 --> 01:13:41.379
around...
1655
01:13:41.379 --> 01:13:43.715
turning people's cards off
and things like that.
1656
01:13:43.715 --> 01:13:47.469
No one ever made
the cards not work--
1657
01:13:47.469 --> 01:13:50.555
never, never, ever, ever.
1658
01:13:50.555 --> 01:13:55.435
We did do some things
to attack fraud
1659
01:13:55.435 --> 01:13:58.480
that we believed
was happening.
1660
01:13:58.480 --> 01:14:00.231
Had a lot of people
that were abusing
1661
01:14:00.231 --> 01:14:01.733
the terms and conditions
early on,
1662
01:14:01.733 --> 01:14:04.319
so we slowed down
and slowed down the growth.
1663
01:14:04.319 --> 01:14:06.571
A company can certainly
implement procedures
1664
01:14:06.571 --> 01:14:08.740
to make sure
there's no fraud going on,
1665
01:14:08.740 --> 01:14:10.492
but that's not
what they were doing here.
1666
01:14:10.492 --> 01:14:11.743
They were hemorrhaging money,
1667
01:14:11.743 --> 01:14:13.703
and they wanted to stop
the frequent users
1668
01:14:13.703 --> 01:14:15.747
from actually using
the product.
1669
01:14:15.747 --> 01:14:18.750
We were being told,
you know,
1670
01:14:18.750 --> 01:14:21.086
to build roadblocks
to our users.
1671
01:14:21.086 --> 01:14:24.172
That, to us as engineers,
was just not okay.
1672
01:14:24.172 --> 01:14:26.675
For us to do things that was,
like, a little dirty,
1673
01:14:26.675 --> 01:14:28.760
like, didn't seem right.
1674
01:14:46.653 --> 01:14:48.697
As a guy running a business,
1675
01:14:48.697 --> 01:14:52.492
I feel like Mitch was doing
what he had to do to survive.
1676
01:14:52.492 --> 01:14:55.453
He was trying to lose
less money.
1677
01:14:55.453 --> 01:14:57.455
Comically and ironically,
1678
01:14:57.455 --> 01:14:59.457
that meant selling less
of his product.
1679
01:14:59.457 --> 01:15:01.793
Now you've taken
someone's money
1680
01:15:01.793 --> 01:15:05.672
for a product
that you're not giving them.
1681
01:15:05.672 --> 01:15:07.340
The first thing
that really jumped at me
1682
01:15:07.340 --> 01:15:09.676
was those internal documents
and emails
1683
01:15:09.676 --> 01:15:12.929
that were basically saying,
hey, should we do this?
1684
01:15:12.929 --> 01:15:16.391
The FTC might come after us
if we do it.
1685
01:15:16.391 --> 01:15:18.476
There seemed to be
almost an awareness
1686
01:15:18.476 --> 01:15:20.979
that, like, the FTC is going
to be very upset
1687
01:15:20.979 --> 01:15:23.106
when they hear about this
and might come knocking,
1688
01:15:23.106 --> 01:15:24.941
and they did it anyway.
1689
01:15:24.941 --> 01:15:26.651
There seemed to be
an aspect of that
1690
01:15:26.651 --> 01:15:28.278
that was almost
sort of cavalier.
1691
01:15:36.077 --> 01:15:37.579
Look, Wall Street
loves this story.
1692
01:15:37.579 --> 01:15:38.663
They love a growth story.
1693
01:15:38.663 --> 01:15:40.331
We got
over 3 million subscribers.
1694
01:15:40.331 --> 01:15:41.916
Nobody's even close to us.
1695
01:15:41.916 --> 01:15:43.168
With MoviePass,
1696
01:15:43.168 --> 01:15:46.254
the way they were telling
the story was exciting.
1697
01:15:46.254 --> 01:15:48.506
We're the hottest brand out
there going for the last year.
1698
01:15:48.506 --> 01:15:50.967
And so we're here.
1699
01:15:50.967 --> 01:15:52.635
We're not going to run
out of any cash
1700
01:15:52.635 --> 01:15:54.095
or anything like this.
1701
01:15:54.095 --> 01:15:58.433
I had invested in MoviePass
between $4,000 and $5,000,
1702
01:15:58.433 --> 01:16:01.519
and I chose to invest
1703
01:16:01.519 --> 01:16:03.688
because it felt
very disruptive.
1704
01:16:03.688 --> 01:16:05.523
It was exciting.
I pounced on it.
1705
01:16:05.523 --> 01:16:06.858
Our burn now is, like, down
1706
01:16:06.858 --> 01:16:09.069
to approximately
$12 million a month.
1707
01:16:09.069 --> 01:16:12.322
Ted's sitting on TV,
telling everyone,
1708
01:16:12.322 --> 01:16:14.532
this is going
to be profitable,
1709
01:16:14.532 --> 01:16:17.202
but you
as an outside investor,
1710
01:16:17.202 --> 01:16:18.536
you couldn't disprove it.
1711
01:16:18.536 --> 01:16:19.788
We're the only ones--
1712
01:16:19.788 --> 01:16:21.414
Have you been able to sell
any of the data yet?
1713
01:16:21.414 --> 01:16:23.124
- Oh, yes.
- You have been able--
1714
01:16:23.124 --> 01:16:26.586
Yeah, we've already signed
agreements with studios.
1715
01:16:26.586 --> 01:16:28.254
They were doing
a lot of interviews
1716
01:16:28.254 --> 01:16:32.425
and mentioning the way they
would make up the loss was,
1717
01:16:32.425 --> 01:16:36.221
they were going to sell
people's data.
1718
01:16:36.221 --> 01:16:37.347
That's insane.
1719
01:16:37.347 --> 01:16:38.848
I can sell someone's
1720
01:16:38.848 --> 01:16:41.851
specific data to an advertiser
1721
01:16:41.851 --> 01:16:46.106
for $2 to $4 per 1,000 people.
1722
01:16:46.106 --> 01:16:47.232
I might get 10 bucks.
1723
01:16:47.232 --> 01:16:50.527
And that's per 1,000,
which wasn't going to offset
1724
01:16:50.527 --> 01:16:52.445
the tens of millions of dollars
1725
01:16:52.445 --> 01:16:54.656
that they were losing
on a quarterly basis
1726
01:16:54.656 --> 01:16:55.907
running this business.
1727
01:16:55.907 --> 01:16:57.826
And how much of this
is about the data?
1728
01:16:57.826 --> 01:16:59.577
A huge amount of it
is the data.
1729
01:16:59.577 --> 01:17:01.079
The stock price goes up
1730
01:17:01.079 --> 01:17:04.082
because Mitch and Ted
created some crazy story.
1731
01:17:04.082 --> 01:17:07.752
60 days, it's going
to be cash-flow neutral?
1732
01:17:07.752 --> 01:17:09.087
Yeah, like, self-sufficient,
1733
01:17:09.087 --> 01:17:10.964
where they're not going
through cash burn.
1734
01:17:10.964 --> 01:17:13.341
It is not illegal
to be stupid.
1735
01:17:13.341 --> 01:17:15.093
It is not illegal to be wrong.
1736
01:17:15.093 --> 01:17:18.263
It is illegal to knowingly lie
and mislead
1737
01:17:18.263 --> 01:17:21.307
and then take someone's money.
1738
01:17:21.307 --> 01:17:22.934
It's the small retail investor
1739
01:17:22.934 --> 01:17:25.687
that gets sucked
into these ideas,
1740
01:17:25.687 --> 01:17:28.857
and no one ever sends
the money back to them.
1741
01:17:28.857 --> 01:17:30.608
They don't see it coming.
1742
01:17:30.608 --> 01:17:33.486
I believe I ended up losing
about $200,000,
1743
01:17:33.486 --> 01:17:35.947
which was
a significant amount for me.
1744
01:17:35.947 --> 01:17:38.700
[chuckles]
Looking at a MoviePass card,
1745
01:17:38.700 --> 01:17:40.910
it makes me feel like...
1746
01:17:40.910 --> 01:17:42.245
warm shit.
1747
01:17:42.245 --> 01:17:43.788
[laughs]
1748
01:17:43.788 --> 01:17:46.833
Ted and Mitch
fleeced retail investors
1749
01:17:46.833 --> 01:17:48.793
and the average person,
1750
01:17:48.793 --> 01:17:51.546
either users of the service
or shareholders like myself.
1751
01:17:51.546 --> 01:17:53.590
It's just sad.
1752
01:17:53.590 --> 01:17:56.468
Ted was not selling
a product.
1753
01:17:56.468 --> 01:17:58.928
Ted is a stock promoter.
1754
01:18:00.472 --> 01:18:02.474
You see a repeated pattern.
1755
01:18:02.474 --> 01:18:06.144
[dramatic music]
1756
01:18:06.144 --> 01:18:08.646
I'm so glad to see that
you made the right choice
1757
01:18:08.646 --> 01:18:10.065
to come to the next section.
1758
01:18:10.065 --> 01:18:12.776
So what you have
to wonder is,
1759
01:18:12.776 --> 01:18:16.738
how is HMNY...
1760
01:18:16.738 --> 01:18:19.157
getting the money...
1761
01:18:19.157 --> 01:18:22.452
so that MoviePass can lose it
so quickly?
1762
01:18:24.162 --> 01:18:25.663
And the answer is,
1763
01:18:25.663 --> 01:18:28.667
they're raising it
from Hudson Bay.
1764
01:18:28.667 --> 01:18:30.460
Hudson Bay
was the hedge fund
1765
01:18:30.460 --> 01:18:31.836
that was behind them.
1766
01:18:31.836 --> 01:18:35.173
In total, it was upwards
of $200 million
1767
01:18:35.173 --> 01:18:39.427
that Hudson Bay
invested into HMNY.
1768
01:18:39.427 --> 01:18:41.346
Your next question is,
1769
01:18:41.346 --> 01:18:44.516
why is Hudson Bay buying stock
1770
01:18:44.516 --> 01:18:47.227
or getting debt from HMNY
1771
01:18:47.227 --> 01:18:50.230
for a business
that's losing so much money?
1772
01:18:50.230 --> 01:18:51.272
We were investigating
1773
01:18:51.272 --> 01:18:53.566
these hundreds of millions
of dollars in losses.
1774
01:18:53.566 --> 01:18:55.193
And we kept trying
to figure out,
1775
01:18:55.193 --> 01:18:58.363
what was the plan to actually
make this business work?
1776
01:18:58.363 --> 01:19:02.867
People like Ted are not there
to build a business.
1777
01:19:02.867 --> 01:19:06.204
They're there
to sell you stock.
1778
01:19:06.204 --> 01:19:07.580
That's what they do.
1779
01:19:07.580 --> 01:19:10.750
And the people who were
working at MoviePass told me
1780
01:19:10.750 --> 01:19:13.044
there was never going to be
any big partnership
1781
01:19:13.044 --> 01:19:14.796
with the major movie theaters.
1782
01:19:14.796 --> 01:19:17.924
There was never going to be
any huge marketing dollars
1783
01:19:17.924 --> 01:19:19.926
that were going to somehow
save the company.
1784
01:19:19.926 --> 01:19:22.178
There was never going to be
this big data
1785
01:19:22.178 --> 01:19:25.348
that magically was sold
to a tech company or something
1786
01:19:25.348 --> 01:19:27.308
and made everything work.
1787
01:19:27.308 --> 01:19:32.313
It is no different than
making a play on Broadway.
1788
01:19:32.313 --> 01:19:34.107
You need a star,
1789
01:19:34.107 --> 01:19:37.193
you need a story,
and you need a prop.
1790
01:19:37.193 --> 01:19:38.737
Mitch is perfect.
1791
01:19:38.737 --> 01:19:41.239
Look at his background.
Look at his appearance.
1792
01:19:41.239 --> 01:19:44.117
Mitch is the guy.
He's the guy. He's the CEO.
1793
01:19:44.117 --> 01:19:47.120
We're on the way
to over 5 million subscribers
1794
01:19:47.120 --> 01:19:50.707
by the end of the year,
and that's when the cash flow
1795
01:19:50.707 --> 01:19:52.834
starts to become positive.
1796
01:19:52.834 --> 01:19:54.836
Ted's the visionary.
1797
01:19:54.836 --> 01:19:56.796
MoviePass is our prop.
1798
01:19:56.796 --> 01:19:58.173
Look at the growth.
1799
01:19:58.173 --> 01:20:00.091
And what is
the revenue stream
1800
01:20:00.091 --> 01:20:02.719
that makes that possible?
- Multiple revenue streams.
1801
01:20:02.719 --> 01:20:04.387
They're putting on a play.
1802
01:20:04.387 --> 01:20:06.431
Instead of buying a ticket,
you bought their stock.
1803
01:20:06.431 --> 01:20:09.267
[chuckles] In both cases,
you left with nothing,
1804
01:20:09.267 --> 01:20:10.685
other than memories.
1805
01:20:10.685 --> 01:20:12.270
Some of the instincts we had
1806
01:20:12.270 --> 01:20:16.691
around the way the ship
was being run were correct.
1807
01:20:16.691 --> 01:20:18.902
That behavior
and those decisions
1808
01:20:18.902 --> 01:20:21.279
were destroying value.
1809
01:20:21.279 --> 01:20:24.324
And the brand
that we cared about,
1810
01:20:24.324 --> 01:20:26.701
the subscribers
that we cared about,
1811
01:20:26.701 --> 01:20:29.746
the user experience
that we obsessed over
1812
01:20:29.746 --> 01:20:33.667
all was getting washed away.
1813
01:20:33.667 --> 01:20:35.001
And this just in.
1814
01:20:35.001 --> 01:20:38.129
The former CEOs of MoviePass
and its parent company
1815
01:20:38.129 --> 01:20:40.131
have been charged
with securities fraud.
1816
01:20:40.131 --> 01:20:42.509
Prosecutors say they misled
investors as part of a scheme
1817
01:20:42.509 --> 01:20:45.929
to artificially boost
the company's stock price.
1818
01:20:49.307 --> 01:20:52.102
The problem with
Ted's strategy at MoviePass--
1819
01:20:52.102 --> 01:20:54.813
like, he lost
so much money so quickly.
1820
01:20:54.813 --> 01:20:57.148
It could have lasted
much longer
1821
01:20:57.148 --> 01:21:01.319
had he said, $30 a month,
and sacrificed the growth.
1822
01:21:01.319 --> 01:21:06.157
It seemed like he just had
a "Thelma & Louise" strategy.
1823
01:21:06.157 --> 01:21:08.993
Let's just gun it
and go off the cliff.
1824
01:21:08.993 --> 01:21:12.122
[tires squealing,
engine revving]
1825
01:21:12.122 --> 01:21:14.916
♪ ♪
1826
01:21:14.916 --> 01:21:17.711
People's money
just went up in smoke.
1827
01:21:17.711 --> 01:21:19.504
If I had done
what they had done
1828
01:21:19.504 --> 01:21:23.591
and gone through $250 million,
I would have been in jail.
1829
01:21:23.591 --> 01:21:25.802
It's kind of like they were
the goddamn Mike Tyson
1830
01:21:25.802 --> 01:21:27.178
of fucking movies.
1831
01:21:27.178 --> 01:21:29.305
How do you burn
through $250 million?
1832
01:21:29.305 --> 01:21:30.890
What the fuck
is wrong with you?
1833
01:21:30.890 --> 01:21:31.850
Are you crazy?
1834
01:21:31.850 --> 01:21:35.145
Ted's a con artist
at the end of the day...
1835
01:21:35.145 --> 01:21:37.355
period.
1836
01:21:37.355 --> 01:21:40.025
What was
a fantastic business idea
1837
01:21:40.025 --> 01:21:43.028
got turned into this circus.
1838
01:21:43.028 --> 01:21:45.196
When I look back,
1839
01:21:45.196 --> 01:21:47.866
I can come up
with a dozen things
1840
01:21:47.866 --> 01:21:49.951
we should have done
differently.
1841
01:21:49.951 --> 01:21:52.537
It's true for any failure.
1842
01:21:52.537 --> 01:21:54.873
It's not only embarrassing,
1843
01:21:54.873 --> 01:21:58.209
but it's also
a big learning lesson.
1844
01:21:58.209 --> 01:22:01.254
And for me, it just reminds me
1845
01:22:01.254 --> 01:22:05.508
how many mistakes that I made
in that whole business.
1846
01:22:05.508 --> 01:22:08.011
♪ ♪
1847
01:22:23.360 --> 01:22:26.029
I'm going to talk a little
bit about relationships
1848
01:22:26.029 --> 01:22:27.489
and connecting.
1849
01:22:43.588 --> 01:22:44.673
My name is Ted Farnsworth.
1850
01:22:44.673 --> 01:22:47.384
I'm the co-founder and
chairman of Zash Global Media,
1851
01:22:47.384 --> 01:22:50.595
as well as co-CEO
of Vinco Ventures.
1852
01:23:00.772 --> 01:23:02.399
Let me apologize
to the shareholders
1853
01:23:02.399 --> 01:23:03.441
of Vinco Ventures.
1854
01:23:03.441 --> 01:23:05.735
It looks like
a circus going on here.
1855
01:23:16.454 --> 01:23:17.956
At one time,
1856
01:23:17.956 --> 01:23:20.917
there was this really positive
group of people
1857
01:23:20.917 --> 01:23:24.379
who were just trying
to make moviegoing easier.
1858
01:23:24.379 --> 01:23:26.214
And...
1859
01:23:26.214 --> 01:23:29.467
it's really an example
of, like, corporate greed
1860
01:23:29.467 --> 01:23:31.177
and...
1861
01:23:31.177 --> 01:23:35.306
what that can do to people
and to a company.
1862
01:23:35.306 --> 01:23:39.310
Ted and Mitch are the people
who took MoviePass
1863
01:23:39.310 --> 01:23:41.896
and turned it
into this, like, monster.
1864
01:23:41.896 --> 01:23:44.566
It was
the greatest thing ever.
1865
01:23:44.566 --> 01:23:46.609
I was paying $10 a month,
1866
01:23:46.609 --> 01:23:50.905
and I was able to go see
a movie once a day, every day.
1867
01:23:50.905 --> 01:23:54.159
And I averaged, like, about--
1868
01:23:54.159 --> 01:23:56.995
I'm going to say I averaged
about four movies a month,
1869
01:23:56.995 --> 01:24:00.123
sometimes four movies
a week, for real.
1870
01:24:00.123 --> 01:24:03.376
And I'm realizing, I haven't
been to a movie since.
1871
01:24:03.376 --> 01:24:05.170
[laughs]
1872
01:24:05.170 --> 01:24:07.422
Oh, I miss MoviePass.
Oh, I miss it.
1873
01:24:07.422 --> 01:24:08.923
I wouldn't have had
a problem
1874
01:24:08.923 --> 01:24:11.509
paying a little bit more just
to keep the company around.
1875
01:24:11.509 --> 01:24:13.678
Maybe had they would have
done it from the beginning
1876
01:24:13.678 --> 01:24:15.972
or kept it the way it was
when it first started,
1877
01:24:15.972 --> 01:24:17.766
maybe it would still be
around today.
1878
01:24:17.766 --> 01:24:21.269
The reason why I still
have it, it was just--
1879
01:24:21.269 --> 01:24:24.064
it represented
a great time in my life,
1880
01:24:24.064 --> 01:24:26.191
despite all the hell
and high water
1881
01:24:26.191 --> 01:24:28.026
and just a lot of stuff
that happened
1882
01:24:28.026 --> 01:24:29.736
outside of MoviePass for me.
1883
01:24:29.736 --> 01:24:33.114
Like, you know, I grew a lot,
and I learned a lot,
1884
01:24:33.114 --> 01:24:36.368
and I think, like, you know,
it's wisdom well earned.
1885
01:24:36.368 --> 01:24:38.620
So I think
that's why I hold on to this.
1886
01:24:38.620 --> 01:24:40.705
I heard those are
collector's items now.
1887
01:24:40.705 --> 01:24:42.374
You heard that?
- How much?
1888
01:24:42.374 --> 01:24:45.210
- Was it $1,000 or something?
- $1,500.
1889
01:24:45.210 --> 01:24:47.337
This bitch will be
on eBay tonight...
1890
01:24:47.337 --> 01:24:49.381
[laughter]
Guaranteed.
1891
01:24:51.466 --> 01:24:55.303
When I got fired,
I went to a monastery,
1892
01:24:55.303 --> 01:24:57.681
where I sit with monks
in silence.
1893
01:24:59.182 --> 01:25:00.684
My anger is there,
1894
01:25:00.684 --> 01:25:03.436
but if you don't do something
with that energy,
1895
01:25:03.436 --> 01:25:04.729
it devours you.
1896
01:25:04.729 --> 01:25:08.233
It eats you from the inside.
It debilitates you.
1897
01:25:08.233 --> 01:25:11.319
When Stacy and I exited
MoviePass,
1898
01:25:11.319 --> 01:25:12.946
I gave myself permission
1899
01:25:12.946 --> 01:25:15.448
to not have to think
about it as much anymore
1900
01:25:15.448 --> 01:25:19.160
and to really start thinking
about new businesses to build,
1901
01:25:19.160 --> 01:25:21.454
new problems to solve,
1902
01:25:21.454 --> 01:25:23.164
new...
1903
01:25:23.164 --> 01:25:25.166
people to work with.
1904
01:25:25.166 --> 01:25:28.294
Even to this day,
when people, you know, hear
1905
01:25:28.294 --> 01:25:31.673
that I co-founded MoviePass,
I get a lot of love.
1906
01:25:33.299 --> 01:25:37.053
People kept talking
about MoviePass.
1907
01:25:37.053 --> 01:25:40.390
Like, maybe one day
this thing can come back.
1908
01:25:42.267 --> 01:25:46.271
In the summer of 2021,
1909
01:25:46.271 --> 01:25:50.942
I heard that MoviePass
was put up for auction.
1910
01:25:50.942 --> 01:25:53.695
I contacted the courts,
1911
01:25:53.695 --> 01:25:57.157
and then I made a bid
to purchase MoviePass back.
1912
01:25:57.157 --> 01:26:00.660
Out of the ashes, like
the rising of the phoenix,
1913
01:26:00.660 --> 01:26:03.955
MoviePass has returned under
the ownership and guidance
1914
01:26:03.955 --> 01:26:06.541
of the original owner
of MoviePass,
1915
01:26:06.541 --> 01:26:08.960
you know, back when MoviePass
was a legitimate business.
1916
01:26:08.960 --> 01:26:10.462
MoviePass is back.
1917
01:26:10.462 --> 01:26:12.839
MoviePass and its CEO
are back at it again,
1918
01:26:12.839 --> 01:26:14.215
this time placing all bets
1919
01:26:14.215 --> 01:26:16.718
on believing they now have
the perfect recipe
1920
01:26:16.718 --> 01:26:18.470
to get moviegoers
back into theaters.
1921
01:26:18.470 --> 01:26:20.513
With theaters looking
for a big boost,
1922
01:26:20.513 --> 01:26:22.557
company leaders feel
now is the perfect time
1923
01:26:22.557 --> 01:26:23.600
for a relaunch.
1924
01:26:23.600 --> 01:26:26.686
We've gotten the experience
really down tight.
1925
01:26:26.686 --> 01:26:28.521
And we're already seeing--
1926
01:26:28.521 --> 01:26:29.981
because we've got
lots of people
1927
01:26:29.981 --> 01:26:31.566
that are already
on the platform.
1928
01:26:31.566 --> 01:26:33.109
Joining me now
here at the floor
1929
01:26:33.109 --> 01:26:34.319
of the New York Stock Exchange
1930
01:26:34.319 --> 01:26:36.780
is Stacy Spikes,
the CEO of MoviePass,
1931
01:26:36.780 --> 01:26:37.864
also author of the book
1932
01:26:37.864 --> 01:26:40.784
"Black Founder: The Hidden
Power of Being an Outsider,"
1933
01:26:40.784 --> 01:26:42.160
the man himself joining me.
1934
01:26:42.160 --> 01:26:43.745
Stacy, thanks a lot
for taking the time.
1935
01:26:43.745 --> 01:26:44.788
Thanks, JD.
1936
01:26:44.788 --> 01:26:46.873
It really feels nice
to see the people tell
1937
01:26:46.873 --> 01:26:48.667
how the book has helped them
1938
01:26:48.667 --> 01:26:52.337
and the honesty
of what I went through
1939
01:26:52.337 --> 01:26:54.714
and talking
about the emotional journey,
1940
01:26:54.714 --> 01:26:57.217
that a lot of entrepreneurs
and founders
1941
01:26:57.217 --> 01:26:59.719
have really appreciated
that level of honesty.
1942
01:26:59.719 --> 01:27:01.805
Thank you for being
a Black founder.
1943
01:27:01.805 --> 01:27:05.558
Thank you for being
an inspiration to all of us,
1944
01:27:05.558 --> 01:27:09.813
for being a man of influence,
impact, and integrity
1945
01:27:09.813 --> 01:27:11.981
and character that you are.
1946
01:27:13.525 --> 01:27:17.153
I was always inspired
by stories like Steve Jobs,
1947
01:27:17.153 --> 01:27:19.072
you know, leaving Apple
and coming back.
1948
01:27:19.072 --> 01:27:23.326
I was inspired by Michael Dell
leaving Dell Computers
1949
01:27:23.326 --> 01:27:24.786
and him coming back.
1950
01:27:24.786 --> 01:27:29.541
And there's so many stories
in the entrepreneurial ethos
1951
01:27:29.541 --> 01:27:31.543
where the founders came back.
1952
01:27:31.543 --> 01:27:34.462
I'd never live with myself
if I didn't try.
1953
01:27:34.462 --> 01:27:37.841
♪ ♪
1954
01:27:37.841 --> 01:27:40.635
I hope that
Stacy's next attempt here
1955
01:27:40.635 --> 01:27:44.848
to make MoviePass what we all
hoped it will be will succeed.
1956
01:27:46.349 --> 01:27:49.394
The best way
I can describe Stacy--
1957
01:27:49.394 --> 01:27:53.940
he's, like, very consistent
and persistent.
1958
01:27:53.940 --> 01:27:57.485
He still feels like he has
an itch he wants to scratch
1959
01:27:57.485 --> 01:27:59.320
with this business model.
1960
01:27:59.320 --> 01:28:03.199
MoviePass doubled
the revenue in theaters.
1961
01:28:03.199 --> 01:28:05.160
That's revolutionary.
1962
01:28:05.160 --> 01:28:07.078
IMAX didn't do that.
1963
01:28:07.078 --> 01:28:09.289
Dine-In didn't do that.
1964
01:28:09.289 --> 01:28:11.541
And two brothers built that.
1965
01:28:13.376 --> 01:28:16.046
I'll never forget--
it was a Saturday afternoon,
1966
01:28:16.046 --> 01:28:18.590
and I went
to Regal Union Square.
1967
01:28:18.590 --> 01:28:20.759
And I was sitting in my seat.
1968
01:28:20.759 --> 01:28:24.929
And in between the seats,
this young brother looks at me,
1969
01:28:24.929 --> 01:28:27.265
and he says, yo...
1970
01:28:27.265 --> 01:28:29.225
are you Stacy Spikes?
1971
01:28:29.225 --> 01:28:30.935
And I said, yes.
1972
01:28:30.935 --> 01:28:33.271
He goes, man, thank you.
1973
01:28:33.271 --> 01:28:35.774
Thank you for everything
that you've done, man.
1974
01:28:35.774 --> 01:28:37.108
You make me proud.
1975
01:28:37.108 --> 01:28:39.611
And that moment...
1976
01:28:39.611 --> 01:28:42.947
that encapsulated everything.
1977
01:28:42.947 --> 01:28:47.118
♪ ♪
1978
01:30:18.501 --> 01:30:21.671
[bright tone]