Tren Griffin @trengriffin I work for Microsoft. Previously I was a partner at Eagle River, a private equity firm established by Craig McCaw. I am on the board of directors of Kymeta. Dec. 19, 2019 1 min read

1/ Of ~ $210,000 to $220,000 of ticket sales last year, most of that goes to the movie companies. If he sells $1,000 of tickets for “Captain Marvel,” $650 or $700 goes to Disney. "I am really a concessionaire. I make my money on popcorn, not on the movie.” 

2/ "AMC uses an algorithm to estimate how many bags it will sell each weekend. Popcorn is among the most profitable items at the concession stand." An average AMC customer spends $4.80 on food and drinks." 

3/ "To achieve the room-filling scent and signature taste-bud-assailing butter flavor of movie-theatre popcorn, cinemas use Flavacol, a sandlike substance whose only resemblance to dairy is its paper-carton packaging. Flavacol is cheaper and easier to manipulate than butter."

4/ "In this example, the cost of concessions for the movie theater is only ~13% of revenue. In contrast, the cost of movie rental and advertising is 52% of revenue (Ouch!). Innovation tends to be focused on the snack bar." 

5/ 25iQuiz: The business model for a movie theater is about selling complementary goods (concessions) associated with a loss leader (showing movies).

What are possible complementary goods in a open source-based business model? What is the equivalent of popcorn in open source?

6/ 25iQuiz: What two words are missing from the following sentence? Because "Captain Marvel" is a scarce product and movie theater screens are not scarce, Disney has:

"wholesale _______ _______ power"

versus theater owners.

You can follow @trengriffin.


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