MoviePass gets potential lifeline from financier Ted Farnsworth, offers to buy subscription service

Former Helios and Matheson CEO Ted Farnsworth said Tuesday he wants to buy the company's failing movie-theater subscription service during an exclusive interview on FOX Business’ “Mornings with Maria.”

Helios and Matheson Analytics Inc. owns a majority stake in MoviePass, which allowed subscribers to attend a movie a day for about $10 a month, but the service was officially halted on Sept. 14. The MoviePass service had already stopped in July because the company claimed to be working on improvements to its app.

“We built the fastest-growing subscription out there with MoviePass and still to this day we have thousands of people every day sending us e-mails to join up and go on the waitlist to join,” he told Maria Bartiromo. “So to take it private for now and then to regroup and restart it was to put a group of investors together and put a bid in for the company.”

The offer, which requires approval from Helios and Matheson’s board of directors, consists of all assets including MoviePass Inc., MoviePass Films, MoviePass Ventures and Moviefone, according to the company press release. The terms of the offer were not disclosed.

Farnsworth stepped down from his roles as chairman and CEO of Helios and Matheson, and from his position on the board of directors, in order to avoid conflicts of interest connected to the sale.

So far, the response from investors has been great, he said.

“Everybody understands the brand, how big the brand is. We obviously built it faster than Netflix or Spotify, anyone out there," he said. "So I think we went through our issues with technology and other issues we had along the way obviously."

MoviePass isn’t the only ticket subscription service to fall. Its former rival Sinemia said in April that it was discontinuing its U.S. operations. During the last two years, people expected the company to fail, he said.

“Everybody said we wouldn't last, you know, 30 days,” he said. “And now — AMC Regal — they've all copied our program and they're all in subscription so we broke the model and now, to me, I think as the independent to go back out there and rebuild it and regroup. It's a good thing.”

Similar services offered by theater owners seem to be more successful than MoviePass. AMC Theatres announced last month that its Stubs A-List program had more than 900,000 subscribers. The service allows members to see three movies a week, but only at AMC locations.

In order to take the company forward, Farnsworth said the strategy includes fixing the technology.

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“We had a lot of people that were gaming the system early on because we were growing so quick – 3.5 million subscribers, you know, in a year and a half —paying subscribers," he said. "So I think to just slow down, grow it slower, sit there and watch it."

In addition, Farnsworth said the company also plans to continue to make movies.