Listen: MoviePass' owner is trading at an all-time low, days after a drastic 1-for-250 reverse stock split
"A quick hit on something. We saw this week that we liked. I don't want to give too much away, but they will involve genetic data in an ostrich coat. Okay. This week we saw the demise of movie, pass a much loved if perhaps overly ambitious service that allowed people to see a lot of movies for not a lot of money and Jemima even tracking the kind of rise and fall. This company. What happened? Exactly. Indeed on. It's been a very sad tale. Actually, a lot of people have been morning, the kind of death of movie pass positioning as sort of robinhood allowing us to financing on movie habit needs. How much was it was nine ninety five a month? Yes. So in August of last year they made the watershed price cut from fifty dollars to nine, nine thousand five, which within one year got one point, five million. Subscribes to the platform. Everyone couldn't believe that a lot. And for good reason, really, I've been always a little bit skeptical as a subscriber myself. I think a lot of people have been skeptical plus they had some difficulty rolling it out. People didn't get their cards. It's been around since twenty eleven naturally. It's the product of co, founder of net flicks Mitch Lowe. And so in two thousand seventeen, once they made that move, everyone flocked to the platform. And unfortunately, it just was never economically sustainable that paying out of pocket to finance us going to the movies, weird their revenues, good. Any other revenues aside from the membership fee? Not that I know. So they cut the prices. Everyone flocked to the platform and they have just been burning through money everson's and in may they filed those regulatory filing that talked about how the parent company had, essentially, no money left. It costs twenty one point, seven million dollars to operate that platform. And we saw the end nearing on Thursday. When movie goes, were attending the theater and movie pass, wasn't able to afford that tickets anymore. And my question was, if movie pass, isn't able to do it. Why are we seeing so many copycat class pass bullpen coming out of the woodwork now and how those startups doing what movie past couldn't do in? What's the answer to that? Well, the answer is that they're not doing it right. Nobody is able to operate an unlimited platform in the way that movie passes been doing. They all. Kind of lock into the the phenomenon of the unlimited past promise. All you can eat model. Yeah, the invest is love and they mock it that platforms that way. But none of them actually have that breakdown and the parent company is publicly traded. Yes, halio Matheson. Yeah, that publicly traded and they just just before they close the announced a two hundred fifty. Two one reverse stock split. So that is to say, if the if the if the shares were trading at a dollar, a share of the next two hundred fifty dollars a share, which I've been following markets professionally for several decades and I can't ever remember seeing a two hundred fifty. Two one reverse stock. Split it whiffs a bit of desperation. The stock split self as an uncommon as youths said, but that that level is definitely our cry for help. They have no money. They took out a loan to finance that that business last week and they've just been flailing ever since. And Mitch Lowe sent an Email to the subscribers few days ago actually saying that they're going to have to raise their prices. So what what did we learn? Are there other ways? Do you think that the all you can eat model could be adapted to make it more competitive. Not not all you can eat. It just doesn't work the the startups. I spoke to the ones that are actually sustainable was called kid pass. It was founded in twenty thirteen and they go off a credit based system what you pay fifty dollars for ten credits and you can get unlimited kids activities. Another, I spoke to juke Louis, which is another New York based dot up. They they started as a twenty five dollars unlimited concert. So very similar, a similar model to movie pass and they very quickly adopted into a tiered pricing system.."