SWAIN Investment rebukes the recession
15 April 2009
The ongoing doom and gloom in the financial world has led to many consumers being forced to change their spending habits, which has led to changes in the way investors spend their money. No longer are mainstays such as banking giving the security in investment of years gone by, leading to an increase in entrepreneurs looking for alternative investment routes.
With consumer spending on traditional nights out at an all time low due to the ‘credit crunch’, people are increasingly looking for a low cost night in. Waitrose recently reported a 30% increase in sales of its ‘As Good As Going Out’ range of ready meals, whilst online DVD rental service LoveFilm claimed a 40% increase in new memberships since the Summer of 2007.
One company that received investment from SWAIN in 2007 has seen a substantial increase for demand in their product as a result of changes in consumer behavior. The Movie Booth deploy DVD rental kiosks across the UK and Ireland. In December 2007 the company received a £125,000 investment from two SWAIN ‘angels’ and in the process of this Carlos Marco, Managing Director of the company, received an award for becoming the youngest entrepreneur to receive investment through SWAIN. Since launching The Movie Booth in early 2008, the company has seen a 60% increase in new monthly kiosk launches, with twelve DVD kiosks being launched across the UK and Ireland since January 2009.
The Movie Booth claim their machines are the modern alternative to Blockbusters traditional DVD rental model, and enable retailers to offer a completely new service from within their existing premises. Alongside company owned units deployed in retail stores, The Movie Booth sell kiosks to individual investors and investment groups looking to become involved in a home entertainment industry which has received a new breath of life since the downturn in the economy led to an increase in consumers spending nights in as opposed to nights out. For entrepreneurs who don’t own sites to place a DVD kiosk, The Movie Booth assist in finding the most suitable locations available based on localized demographic data.
DVD rental kiosks have proven to be extremely popular amongst investment groups in the USA, which includes McDonalds, Coinstar and MCG Capital Corporation. The biggest operator of DVD kiosks in the US is Redbox, who now have over ten thousand units in operation. The Movie Booth hopes to recreate a similar success story in the UK and Ireland, so says Managing Director Carlos Marco:
“We have seen a big increase in interest in our product since the credit crunch began. Most of the people we work with are individual entrepreneurs looking to invest their cash in a business which can grow in this economic climate. We have also seen a big increase in the number of people renting DVD’s from our kiosks which shows the great strength of our market. We are happy to say that our investors have been very happy with the returns they have seen so far”.