After opening red hot in October 2019, Little Shop of Horrors at the Westside Theatre had a rough second half of 2022.
Box office sales fell short of the revival’s $180,000 to $200,000-a-week running costs in 27 of the final 31 weeks of the year. Operating losses for Alan Menken and Howard Ashman’s plant-based off-Broadway musical comedy, set in a Skid Row flower shop, totaled $734,000 over the seven months ended Jan. 1, 2023.
Such shortfalls can lead to closing notices. Instead, the producers distributed $1.2 million of profit to themselves, their investors and co-producers. That was on top of $1.9 million of profit paid out over the previous 15 months.
The federal government’s mammoth bailout of live entertainment helped keep Little Shop flush. Through the devastating pandemic, the Small Business Administration’s $14.6 billion Shuttered Venue Operators Grant program sustained theater companies and producers who lost their livelihood. (It was also a windfall for some blockbuster productions that had the wherewithal to return from the 18-month shutdown without aid.)
While Little Shop is an SBA success story — its long run helped preserve jobs and New York’s vitality — the musical’s grant was out of scale with its costs. Skid Row Downtown LLC, the Little Shop production company capitalized for $2.2 million, received $10 million in federal aid — roughly equivalent to a year’s box office revenue following the shutdown.
This story is based on financial statements filed with the office of New York State Attorney General Letitia James and obtained via Freedom of Information Law requests.
In October, Little Shop‘s lead producers — Tom Kirdahy, Rob Ahrens and Hunter Arnold — celebrated 1,000 performances with a party at Bryant Park Grill. “Currently, the producers aren’t available to participate in your story,” production spokeswoman Leslie Papa said in an email to Broadway Journal, “and as a matter of policy, do not comment on the financials of the production.”
Directed by Michael Mayer, the revival originally starred Jonathan Groff (Merrily We Roll Along), Tammy Blanchard (The Iceman Cometh) and Christian Borle (Some Like Hot). In early 2020, Little Shop grossed as much as $357,000 a week. With no losing weeks in the first two months of the year, it generated operating or “running” profit of $389,000.
The show fully repaid investors in 2020. The Little Shop financial statements released by the Attorney General’s office cover 2020, 2021 and the seven months ending Jan. 8, 2023.
The show went on hiatus March 12, 2020, along with the rest of Broadway and off-Broadway. Its strong early results underpinned the generous SBA grant. Entitled to as much as six times its average 2019 monthly revenue, the production initially was awarded $7.4 million. In August 2021, the SBA, with money remaining in the program, offered “supplemental awards” for entities that experienced a 70 percent revenue decline in the first quarter of 2021. That pushed Little Shop‘s total federal payout to $10 million. It also secured $500,000 in business interruption insurance proceeds.
To close and reopen, the production spent $2.5 million, just a quarter of what it received from the SBA. The largest single expense was advertising: $1.1 million, most of it for the relaunch. Payroll, rent and advertising were among the expenses eligible for federal aid.
When performances resumed in September 2021, Covid-19 testing and disinfecting contributed to a roughly 25 percent jump in operating expenses. The musical eked out a $69,000 operating profit in its first 12 weeks back, only to see that lost in the final three weeks of the year. The producers cancelled performances during the normally-lucrative holiday season, citing a Covid case in the cast. Ultimately, Little Shop had a fourth-quarter operating loss of $40,000.
Still, as of January 2023, the production paid out $3.1 million in profit. It had another $1.4 million in member’s equity — assets less liabilities. That suggests investors at least doubled their money, an impressive feat off-Broadway, where commercial success is rare. In addition, there was $1.5 million of “profit participation” for insiders since 2021.
Would Little Shop have done as well financially in a parallel universe, with no Covid and no $10 million? Who knows? But there’s no doubt that as much as the show thrived pre-pandemic, the federal grant played a large role in its “profitability,” based on the statements Broadway Journal obtained.
In the 2008 bailout of the financial system, the Treasury Department invested in hundreds of banks, which eventually proved profitable for taxpayers. Today, musicals that receive a state production tax credit of up to $3 million and meet revenue thresholds must contribute to a New York State Council on the Arts program fund.
The SBA said it had minimal leeway administering the program. “The SVOG program was established by congressional statute, which, by law, the SBA was then obligated to implement,” an SBA spokeswoman said via email. “The SBA worked extensively with performing arts industry stakeholders, while ensuring prudent management of government resources in accordance with legal parameters.”
Some producers and investors have funneled their SBA-subsidized profits back into the industry. Should the federal government create another big program benefiting commercial theater, it might yield a greater return on its investment by dictating how excess funds are divvied up.
