How did Shark Minh Beta open his first movie theater with 10 billion VND while only having 5 billion VND?
In 2014, when opening the first Beta theater in Thai Nguyen, Shark Minh Beta only had a total of 5 billion VND in initial capital, which was accumulated money after 2 years of working in Singapore and starting a Donut chain in Vietnam.
5 billion VND was a considerable capital at that time for a startup, however, this amount was only half the amount that Shark Minh Beta invested in the first Beta theater in Thai Nguyen.
Specifically, according to Shark Minh’s sharing, the first theater in Thai Nguyen had only 3 small viewing rooms, with a total cost of about 10 billion VND.
So how did this entrepreneur born in 1983 start a business with a lack of capital?
First is to save everything. Shark Minh Beta said that with the first theater, he and his colleagues personally searched for suppliers for each small item.
The second is capital occupation. This is a classic path of entrepreneurs, using resources from suppliers. Of course, it is not easy for suppliers to give new customers a credit limit. So it’s important to make them understand the feasibility of the business, the ability to generate cash flow, and the capacity of the business operator.
Shark Minh Beta recalled that he had a long conversation, persuading the projector supplier that I was just starting a business, let me pay slowly. In reality, it’s like a form of financial lease.
“At that time, I didn’t have enough money to buy a projector. I convinced him that there was no theater in Thai Nguyen, I was the only one, so he didn’t worry that I would lose money. I built the framework and he put the machine in for me. I paid him from the monthly revenue.”
In addition to the projector supplier, Shark Minh Beta also used a similar method with contractors to contribute to the construction costs.
Shark Minh Beta at the age of 34
Finally, to quickly replicate the model, build the brand without waiting for accumulated profits to reinvest, Shark Minh proactively called for capital. He said that after opening the first theater, there were investors pouring money to build the next theaters.
Beta cinema in Thai Nguyen
How did Shark Minh Beta persuade film producers to release movies at the same time as the “giants”?
Choosing the cheap cinema segment, with a fun, youthful and dynamic style, with good quality, Shark Minh Beta aimed at the market that was abandoned, which was the group of student customers and average-income people. Especially in small districts, suburbs – where people have not had many opportunities to access modern forms of entertainment like in big cities.
Although the ticket prices are lower than competitors, Shark Minh Beta said that the Beta theater system released movies in the market at the same time as other theaters. Regarding the reasons why he could persuade producers, the 1983-born businessman said:
First, when Beta opens up a new segment, it is expanding the market. Although a customer coming to Beta pays a lower ticket price, equivalent to the film producers receiving lower revenue from one person, it is compensated by a larger number of customers. So overall, the filmmakers still benefit equivalently.
Secondly, when exploring new areas like Thai Nguyen, Beta is not confronted with competition from the “giants” and expands the market for the entire industry. That is why Beta can choose a “niche” but still have a similar input as other rival theaters.
The success and expansion of Beta were then supported by capital from investors. Specifically, in less than a year after opening the first theater in Thai Nguyen, in 2015, Beta Media – the unit operating Beta Cinemas received investment capital from VIG (Vietnam Investment Group).
In 2017, Beta Media continued to receive investment capital from Blue HK Financial Group (Hong Kong) in 2017 with a company valuation of 600 billion VND. By 2020, with an investment of 8 million USD from Daiwa PI Partners Investment Fund (Japan), Beta Media reached a company valuation of 1,000 billion VND.
