Daybreak - Pandemic dealt a knockout punch to BookMyShow. Now it’s coming back with a new face

Episode Date: April 17, 2023

BookMyShow has its share of testing times since its birth back in 1998. The last one came as the pandemic and brought the platform down to its knees. Year-on-year revenues fell to one seventh in FY21 and it had to cut down its employee size from over 1500 to just a little over 500.To everyone's surprise, however, BookMyShow managed to not only survive but also recover quite swiftly.But now, the company wants to become more than just a movie ticket-selling platform. It want to win the live events game. Tune in!

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Ramon Ganesh, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission. We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture,

how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production. Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd.

To get alert, as soon as we release our first video. episode, please follow intermission on Spotify and Apple Podcast or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. When was the last time that you stood in a queue to buy a movie ticket? Who does that anymore, right? It's too big a risk to take, especially if it is a movie that everybody has been looking forward to. And why would we?

When we have the option to skip the queue all together. And God knows how much we love doing that. Book My Show. The foolproof way to get a movie ticket, minus all the hassles. I mean, it even lets you buy popcorn and nachos and whatever you like in advance. So it wouldn't be a stretch to say that the platform has now become synonymous with watching movies. But what if I told you that over time, it might not be the same book my show that you have known all these years? I mean, if it were a person, imagine them going through a makeover after.

after which you are never able to look at them the same way. Let me illustrate with an example. Last week, Book My Show Stream, which is the company's transactional video on-demand service, partnered with Vroth to offer their premium content on Book My Show's streaming service. Vrott, by the way, is a subscription-based streaming platform that offers global content dubbed in regional languages.

But hang on for a second. Book My Show has a streaming platform Did you know? Because I did not. Do I live under a rock? Oh, maybe. So what is going on? You see, the platform has had its share of some pretty intense challenges since its birth back in 1998. The latest one, of course, came in the form of the pandemic. Now, we all know how badly that hit the movie business. For Book My Show, it was a knockout punch. But ever since, the company's recovery path has left many surprised and also equally impressed. Ashish Hemrajani, the group's founder and CEO, has publicly spoken about how the crisis

also presented an opportunity for the company to transform fundamentally. What is Book My Show up to? Welcome to Daybreak, a business podcast from the Ken. I'm your host, Nickda Sharma, and I Don't Chase the News Cycle. Instead, thrice a week on Mondays, Wednesdays, and Fridays, and Fridays, I will come to you with one business story that is worth understanding and worth your time. Today is Monday the 17th of April. BookMy show was born back in the late 1990s.

Sometimes I can't believe how long ago that was. Anyway, Big Tree Entertainment, BookMy show's parent company, began selling movie ticketing software. And a year later, it diversified into selling tickets. But not long after, in 2002, to be specific, came the dot-com bubble crash. It was the first big setback that the company had faced. The stock market bubble of the 1990s had burst because of the massive growth in internet and a proliferation of venture capital. The crash also resulted in widespread layoffs in the tech

sector. Big Tree Entertainment was forced to scale down from 150 employees to six. Somehow, the company survived. But a couple of years later, Lehman Brothers filed for bankruptcy. And we all know what happened next. A global financial nightmare. Book my show went through it and again came out alive. But nothing. I mean, nothing could have prepared it for the hell that the pandemic unleashed on it. And we are talking about a giant here that had a near monopoly in the movie ticketing business. In fact, in 2019, things were going pretty well for BookMy Show. There was a race to acquire a 12% stake in the company. The valuation for Book My Show then was around $1 billion.

Private Equity Major General Atlantic, Singapore state investor Temasek, and Goldman Sachs were fighting for it. But the pandemic brought Bookmys show down to its knees. It underwent major layoffs from over 1,500 employees, it had to scale down to around 500, and this was within a span of 15 months of the pandemic. It also paused operations in three international markets, namely Malaysia, Indonesia and the UAE. The Ken reporter Ayusha Garwal, who wrote about Book My Show, said that the company can be compared to a ball that shrank during the pandemic, from one that you would have to hold with both your hands to one that can sit on your palm.

year-on-year revenues fell to one-seventh in the financial year 2021. Losses stayed constant at $29 million. The following year, things got slightly better. The company's revenues grew three times to $40 million, and losses came down from $29 million to $12 million. Now, it has restarted its operations in Malaysia, Indonesia and UAE, and also in Sri Lanka and Singapore besides India. Book My Show really seems like a real-life example of that quote that we hear so often.

Clicate but true. It is not about how many times you get knocked down. It is about how many times you get back up. So what does this recovery look like right now? Stay tuned to find out. According to an employee that Ayush spoke to, the company's culture has now become more focused towards efficiency. Another employee told us that earlier,

the product team would mindlessly execute. instructions from the business team. But now, there is a healthy pushback on what will work and what will not, whether it is in line with the vision for the next two years, and also, how will teams collaborate? The reduced traffic to the website has also allowed the company to transition from on-premises data centers to the cloud using a platform like Amazon Web Services. This has helped them reduce infrastructure costs by 80%. It has also helped the company adjust data storage expenses based on busy or lean seasons of movie releases and event schedules.

In May 2020, Book My Show responded to the pandemic by developing Book My Show online, a video streaming platform that showcased live performances across comedy, music and other arts. And then in early 2021, it launched Book My Show stream, a movie streaming platform that lets users buy or rent films that are exclusive content, like classics, contemporary or acclaimed films that might not be available on other OTT platforms. While all of this help maintain the brand recall and gain new users, the segment's contribution to the revenues of the company was quite small. But Book My Show's leadership has its eyes on the main price, which, according to it, is live events. That is where they believe the money is at.

Coming up next, we look closely at what BookMy show has been doing in the live event space. BookMy show actually started considering live events for diversification much before the pandemic, as early as 2017. In 2019, it co-produced a concert by the rock band U2 and also an interactive exhibition for fans of the US-based entertainment company Marvel. It was called Avengers Station. But now the company has a much better data-driven understanding of what its customers are like. This allows it to curate events based on their preferences and ticket prices. An employee told again, and I'm quoting, for example, Comic Con, for which Book My Show signed an exclusive contract seven months ago, is a more Pan-India event.

But rock music festivals are more preferred in the south and the east of the country. Over the last year, Book My Show has co-promoted and produced a bunch of events. The India leg of the singer Prati Kuhar's tour, the comedian Veed Das' tour, the Feeding India concert featuring American pop star Post Malone and quite a few others. And next month, Backstreet Boys are coming to India for their DNA World Tour. Guess who is bringing them here? Book My Show. Great. All this sounds great, right?

But live events are historically known to be risky. with higher chances of losses. What is Book My Show going to be faced with if it wants to turn that around? Stay tuned to find out. Here is what an employee told us, and I'm quoting, typically one such event should generate enough revenue

equal to four to five movies in terms of value as it also runs for a far shorter duration. End quote. To make the events profitable, sponsorship deals must be big. The company needs to show that a solid return on investment is possible through banners, stall sales and other methods. But you see, many of these events depend on the availability of individual artists.

And the ever-changing costs of artists can raise other issues. So to bring in consistency, the company wants to lock long-term contracts for strong global festival IPs, like it did with Lola Paluza in Mumbai in January this year. But an employee also told us that Lola Palluzza's budget, was out of limits and the company lost at least $1 million. But it seems like Book My Show is playing the long game here. It hopes to break even by the third edition of the festival and be profitable by the fifth edition. Let us see how that goes.

Another option would be to create repeatable IPs like it did with an event called Over the Top in which its first edition saw the single AP Dillon perform live for the first time in 20. But there is also the Competition Commission of India to look out for. Book My Show is already in its radar because of its monopoly. And then of course there is the Ainox and PVR merger. Once that happens, the entity will have an upper hand and might want to renegotiate its contract with its partners including Book My Show. So Book My Show clearly has a huge challenge ahead.

It is a matter of resilience, which the company has been known for so far. But can it turn around a vertical like live events that has been known for making losses turn around completely? What do you think? Write to me at Daybreak at the ken.com. It is THE-K-K-E-K-N.com. And also if you have any feedback about this episode, did you like it? Did you not like it? Write to me on the same email ID.

Daybreak is produced from the Newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters, subscriber-only apps and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. I am Snigtha Sharma, your host, and today's episode was edited by my colleague Rajiv Sien.