Tim and Karrie League have sold the franchise and marketing operations of Alamo Drafthouse to Terrell Braly, the company's CEO; John Martin, the company's principal partner; and a silent partner. The new company is known as Alamo Drafthouse Cinemas Ltd.
Because League will be chief creative officer of the new company, the franchises will continue to have the Austin feel of the original Alamo Drafthouse, which features art house films along with B-grade movies such as "Night of the Bloody Apes."
Based on a report by business research firm D&B, Alamo Drafthouse has gross sales of about $900,000 per screen annually, nearly double the industry standard, even though Alamo theaters generally have smaller auditoriums than those found in megaplexes. The reason for the difference: Alamo patrons are willing to plunk down, on average, $15 for a burger and a couple of beers in addition to the $7.50 ticket price.
Braly said the sale came after a year of discussions between him and the Leagues. Braly said he had wanted to buy a "significant equity position" in the company when he joined Alamo Drafthouse in April 2002 as the venue rental manager, but a year ago discussions began on buying the franchise operations.
The first franchise was awarded two years ago to Travis Doss, a University of Texas graduate, who opened the first first theater outside of Austin in a refitted movie house in West Houston.
Doss' Neighborhood Theater Group is working on adding four more theaters in the Houston area, three of which will be built from the ground up.
Another group, Real Dinner Partners, was awarded a franchise last year. It is opening its first theater in San Antonio next month and building another in San Marcos early next year. Real Dinner Partners is planning a second San Antonio location as well as theaters in Waco, Midland, Tyler, San Angelo and Corpus Christi.
Braly said the success and quick expansion of current franchisees prove the Alamo Drafthouse is no longer just a concept but a "real company."
The franchisees each paid $50,000 for the franchise and send 5 percent of their weekly gross revenue to the company as a franchise fee.
Ultimately, the company plans to have 20 franchises and 200 theaters nationwide.
Braly said he and Martin are talking with two other possible franchisees who want to open stores in Colorado and Florida.
"We've had people fly into Austin to see the theaters. That's when we know they are serious," Martin said.
Braly said the goal was to have the 200 theaters in five years. Now, he said, that "may be done in three."