In September 2013, while attending an industry conference for my current day job, I began to think about my career and how I wanted to do something that I enjoy and am passionate about. After texting ideas back and forth with my wife Amberlee, we decided to open a movie theatre in Strathroy. Two of my biggest passions are movies and electronics, so opening a movie theatre seemed like the perfect fit. After conducting some initial market research and discussing the idea with family and friends, we decided to proceed and registered the business in November 2013.
We began learning everything we could about theatrical exhibition, reading books and trade magazines, attending CinemaCon (the industry’s main annual conference), attending general business seminars and workshops and consulting with various government and other resources. We joined the Strathroy & District Chamber of Commerce, networking with several local businesses who were excited about the prospect of a movie theatre coming to Strathroy. We began looking into potential financing options. After attending a workshop on business financing, I met with several government and private lenders in January 2014 to get high-level information on what was available and their lending criteria. Following these meetings, I was confident that with a solid business plan, we had a great chance at securing the financing we would need to get our venture off the ground.
Over the next several months, we invested a great deal of time and money working with consultants to evaluate potential locations, come up with a conceptual design and develop a detailed business plan. By November 2014, we had selected a location, completed our initial conceptual design, spoken to several potential suppliers and our business plan was nearly complete. At this point, we needed to get more detailed information on our financing options (interest rates, amortization and grace periods, etc.) so we could funnel this information into our financial model.
Unfortunately, during a meeting with one potential government lender (I won’t say which) in late November 2014, I discovered that the information they had provided in January 2014 was incorrect; their availability of funding was much lower and their criteria much higher than what I had been told earlier. Even worse, this particular lender was the intended source of the bulk of our financing. As a result, we now had a huge hole in our capital budget. We have spent the past 10 months trying to find alternative sources of financing while continuing to proceed with our planning; primarily, tweaking our design while working to get a clearer picture of our construction budget. We have also tried to come up with several “contingency” options, including exploring the “not for profit” angle and decreasing the scale of our plans to accommodate the amount of financing we believe to still be available. We have also consulted with the founder of one of the largest theatre chains in the United States as well as professors and lecturers from the Ivey Business School at the University of Western Ontario.
Despite our best efforts, we have not yet been able to come up with a viable business that fits within the confines of our current funding picture. Please trust me when I say that no one is more disappointed about this development than we are. We have invested thousands of hours and a significant amount of personal capital in this project; we even sold our house and moved into a smaller house to free up more capital for Strathroy Cinema. After all of the residents, businesses and local politicians we have talked to, we know more than anyone how badly Strathroy needs a movie theatre. Not only would it provide several new jobs to the community, it would provide a great new local option for entertainment for people of all ages. It would attract new residents and new businesses to the area. We have no doubt in our minds that Strathroy Cinema would be a successful business. Unfortunately, without adequate funding, we are unable to make our dream of opening a movie theatre in Strathroy a reality. We have not entirely given up hope yet, but without an unexpected (and sizable) infusion of capital, Strathroy Cinema will not happen. Of course, if any opportunity arises in the future and we are in a position to get Strathroy Cinema up and running, we will absolutely do so.
We apologize for getting everyone’s hopes up; we would love nothing more than to open a movie theatre to serve the residents of Strathroy and surrounding areas.
If anyone has any questions, please feel free to post them on our Facebook page and we will do our best to answer them.
Martin & Amberlee Thuss and Family