MoviePass was his idea. HBO documented the chaos, but now he’s taking it back.

scored an Emmy nomination. In many ways, the story of movie Pass is one of those classic tales of what we call in shitification, right when something good gets wrecked by private equity, relentless growth chasing and short term things. But it's also a story about race and what it means to be a creative black founder steering something huge. There's also a different story at the heart of this, a genuine love of movies, that magic moment when the lights go down and the screen lights up.

I had already seen Star Wars, but this almost seemed like a reality you could touch, that you believed was not that far away, where I think Star Wars was so far away it was fantasy, but Blade Runner felt like, you know, this is this is going to happen in a few years kind of thing. And when you're that young, you don't know the difference between reality and what's real and what's not. And I remember, I want to work

in this world or in this business. I want to work in robotics, want to I want to do this kind of stuff that these people are talking about and I just found it a beautiful film and at the time, I think it touched me like a lot touched a lot of people. It wasn't a very big box office success, but it just stole my heart. There's literally on my wall in my office. I have a poster Blade Runner still up today.

And today she would be arrested for that behavior. But true story. So every Saturday we were whether it was a double feature or seeing the same movie again, and the managers knew us and we got our little hot dog and so popcorn and what was what was quite amazing. I think after I saw Blade Runner, I told my

parents I wanted to take a screenwriting class. And the only one they could find was at Rice University, which was a college course, and they it was a summer course, and my mom got permission because she knew some people at Rice. She got permission for this eleven year old to sit in a movie screenwriting course. And I remember my feet could really touch the floor that well.

from your like suburban town. It was just all like it really felt like something that was a far away dream. And then you get older and you're like, oh, somebody has this job, why not me?

always so exciting about that experience. So I I just this weekend, the last three weekends, each weekend I went to see Sinners. And first time I saw it in the same week and I went to regular screening, and then I saw it on Imax, and then I went this weekend. And each time it's a different movie. Right, there's something different, you see something else, there's an added thing. And while I've never been a filmmaker, I'm always looking

at where the camera sits. Why did they choose to come up from below, or why are they coming from on high or how are they panning? And what they want you to see and how the cinematographer and different lighting like the way Dune would change its whole color palette depending upon what world you were on. Just all of that stuff, like my mind just geeks out on all of it.

And I did that a lot. I saw movies I never would have picked in theaters I never would have gone to otherwise. It made movie going feel spontaneous, accessible and even kind of luxurious. I'm not ashamed to admit that a few times I even used a movie Pass just to be able to use a bathroom in a movie theater while I was out and about. So for me, we were solidly still in the this is awesome era of the story. But even then, every time I swiped

that movie pass card, I'd think, how is this sustignables? Like, how is this making anybody any money? It kind of felt like the money wasn't even real and if it was, well, it wasn't my problem. I want to talk about Movie Past because I remember the height of Movie Pass, and for people who weren't there, it's like it truly was that you had to be there moment in culture. It's

kind of a joke in my house. My partner one of our first dates, I was in a movie and they texted like, Hey, do you want to get a drink? You want to hang out? And so I left the movie to come meet them and they were like, Wow, you must really be into me if you like left the theater. And I was like, nah, homie, movie Pass, I'll just go catch the end tomorrow. What was it like to be part of it in that heyday, in its height, when like it was really poppin', you know.

one wall here and one wall there. And I was standing at my wall, and I kid you not, everybody pulled out a movie pass and I looked over to the other side and they all had movie passes too, and people were waiting, and it was surreal. It was like and people were looking at each other like, yeah, you're part of the club too, and we know each other and we're you know, we always had this same movie passes for movie people, right, and we movie people

understand what that means. And that was a very surreal moment. That's when I knew we were sitting in another world. Then you were always on the grind for years, trying to get this thing and get it up the hill, and everybody's trying to knock you down and it's not gonna work and no one's gonna like it, and the theaters aren't going to allow it. And then boom, it just it's it's everywhere. And that was that moment.

a certain number of people who go often enough. And what you were doing was for the theaters you were increasing attendance and for the consumer you were driving savings and reducing mental friction like should I go, shouldn't I go? Then it just became a question of do I have the time right? And I know, for me, would my movie pass, not only being a creator but a customer. I would be in a city somewhere and oh I got two hours before my next meeting, and boom, I'm

in a movie, you know. And it kind of changed the friction of it. While it may not be much that twenty dollars you make, should I spend the money on this? It took that friction away, and that's was a really big difference. You know that I saw it happening.

much about the money. It was about being a member of a group of people whose behavior It was like, there are there are dead heads, right, and you would hear about deadheads saying like if somebody said to you, I took three months off my job to go follow the grateful dead around for the summer, you'd think they were.

community around movie going. There was you're a member of this theater chain, or you're a member of the Disney Club or something like that, but no one had ever done and around just movie going in general. I remember people saying I'm gonna go see every Oscar nominee on movie pass right and they would say I'm and they would post it and they that was that was, you know, such a huge change, and I thought something great for our cinematic culture.

particular kind of person. And I think you built something that was like a way to signify that you were in this group.

is a special thing. And there is just no way I would have had as much fun watching it on my couch on TV. There's just no way.

yourself fully over to this immersive world. And I do you worry that we are in a climate where some people are not allowing themselves the beauty of that experience because it's like, oh, well, I'll get the gist of it, I'll text through it or what have you do?

get a diminished experience, you know. And we talked about how cinema was going to kill Broadway, and then television was going to kill cinema, and then streaming was also going to kill cinema and DVD and VHS and blu ray and larger screens, and the reality is it is still the number one out of home entertainment activity in the world. By far, people go to the movies ten

times more than all sporting events combined. No matter what part of the world you're in, whether you're in Asia, whether you're in Africa, or whether you're in India or even in America, we go ten times more. So I think I think that the headlines blow it out of proportion. It's still you know, two thirds of Americans every year go to the movies at least once, and that's that's a big music concerts anything. Think of it like this on one movie that breaks one hundred million dollars in

a single weekend. That movie movie had more people go to it than all of the games of the entire NFL season coming up. Wow, one movie. So when people I think it's the King of the Hill that people still like to beat up on. But I, like you think that it is the cheapest experience you can for a live event. It is accessible, and it's opened three hundred and sixty five days a year. I don't think it's going anywhere.

in as leadership. There was absolutely a racial dynamic at play here too. You have a service created by black people, and then you bring in two white guys who maybe look the part of what some people assume a tech CEO looks like, just without any of the actual vision. Ted and Mitch's big idea to save movie Pass dropped the price down to nine dollars and ninety five cents a month for unlimited movies. And as much as my greedy ass liked that price point, Stacy warned it was unsustainable,

and he was fired from the company for saying. Zone Sure, subscriber skyrocketed, but the service quickly became unusable. Movie Pass started blocking users from seeing movies, intentionally resetting passwords and blaming fake fraud alerts, you know, something the government kind of thinks of as a crime. According to the FTC movie Pass did this to seventy five thousand users. The FTC says that Mitch and Ted knew about ordered and helped run this so called password disruption program they were

running on paying customers. Meanwhile, Mitch and Ted were also blowing through movie passes money, like flying the wrapper fifty cent to Coachella on a movie pass branded private jet. Why who knows? The Justice Department says this was all a scam. They lied to investors claiming the nine dollars and ninety five cents model was profitable when they privately admitted it wasn't. They also hyped up some powerful AI that was meant to monetize movie pass user data, only

that AI didn't actually exist. Classic AI washing, a tech CEO vaguely claiming that AI is doing a thing it is absolutely not doing. Both Mitch and Ted eventually applied guilty to securities fraud. They faced actual jail time. In just eight years, movie Pass went from massive growth to total collapse and stacy while he was out of the company that he founded. What did it feel like to be pushed out of something that you built, you know, that was that was your baby?

And it was very simple, kind of big boy chess moves where it was like we got some investor capital, the we had three board seats that additional money asked to expand the board to five, and he had then three seats and we had two. And then he brought Mitch in and the next thing, you know, the dynamics of the board had changed and they were then able

to make decisions that we couldn't stop. And it you kind of think, oh, we're all friends here and we all have the same purpose and we're rowing in the same direction, and then quickly the dynamics had shifted, and then you realize too late you're out. But people say, what would you have done differently? And I said, I

honestly don't know. Because you're out raising capital and there are some businesses you can go make a little hair salon, our, a pizza shop, and you have your initial startup capital and you work your way up over many years. But when you're building something that is like a national theater subscription circuit, you can't do a little at a time. You kind of have to do it all, and so you have that build cost, and so you have to build fast and someone or someone else is going to

build it and beat you to the race. Like Netflix, if you can get there, and you can get there first and established dominance, you can withstand the storm because you were first to the party. And even when people cut away like they're starting to do with streaming services, they're still going to keep the one. Back in the day, nobody would cancel HBO, right, it was like you had

your HBO. So it's similar to that, and that having gone through that experience, you realize how how many you know a lot of diverse founders are artists woke up, whether it was Sammy Davis Junior or Red Fox or Richard Pryor, and they woke up and they were broke. How I broke? You got to walk through something similar and you realize it can happen to you too, no matter how smart you are.

Power of being an Outsider. Watching the documentary, I was really struck by the ways that it was a story about race, and you know, the reality is not great for you know, folks of like entrepreneurs of color. I think it was what like less than one percent of a funding goes to us, and so is there a negative perception that comes with Thunders handing over a big check and a lot of trust over to a black founder.

Do they feel more comfortable handing over that trust and handing over that money to somebody who looks like Mitch and Ted versus somebody that looks like me or you.

and I said, you know, if we go outside. We were at the Angelica, and I said, if we walk outside onto Houston Street and we start asking people, close your eyes and tell me what a tech founder looks like. Right, they're gonna describe or give me a name, or tell me what you think of tech founder. I told her, they're not gonna describe someone who looks like me, and

they're not gonna describe someone who looks like you. But I said, tell me what a star basketball player looks like, or tell me what a star athlete looks like, or even give me a star player in golf or even tennis, or even gymnastics or any of those things. Well, they may describe someone who looks like me when it comes to that. And again that's that thing about pattern recognition.

And I think when I was working on my book and we were deciding what the cover was gonna be, we talked about black founder and it was like I wanted to put my face on the cover so that more and more you're gonna see this is what founders look like too write. And once upon a time we were not in any sports, and so we had negro leagues,

but we weren't on the main field. So over time, I think it can change, but there needs to be more of us who are out there making it happen, and that they get to see us and they start to realize, Okay, this is acceptable. I don't think it's like racism, like they're not as good. I think it's it's a categorizing in a way to say because I don't see this that often, I'm going to trust it less or I need more to be convinced that it works.

room like that, the white guy is the founder. I can understand how we need to see more and more founders that look like you, founders look like me, so that folks break those patterns.

was so taboo? And then I remember Denzel doing people were saying, why don't you ever kiss anybody in a movie, right, but he would have Julia Roberts or some lead across him and they couldn't. They never touched each other. And then when I saw Moonlight, I was like, that's a huge accomplishment. You saw black love. You saw same sex black love, and it wasn't even Broke Back Mountain violent in the tent. I'm taking this shit. Black Love. It

was beautiful. And that's what I mean by now you can see people moving around in the world and it's fine. It's like pattern recognition. It's one of those strange things about our time, how people are trying to roll back things that are now commonplace and trying to roll history back to the nineteen fifties, as if that's something more sacred but interesting.

needs others might overlook. That outsider's insight is what led Stacy to create Urban World, now the largest Academy Award qualifying Black and Multicultural film festival in the world, and nearly three decades later, it's still going strong and it's twenty ninth year. The subtitle of your book the Hidden

Power of being of being an outsider. I've always thought this that, you know, being at the margins or being someone who's like traditionally marginalized, it can actually be a place of power for folks who want to build something sometimes, Like for instance, with Urban World, you saw an overload need in your own people and in the community, and we're able to build something that spoke to this need that existed, right, And so I feel like some of what you're trying to do is like reframe this thing

that is so often we're told as like a negative, as like a kind of a source of strength. It's like, yeah, I bring a different perspective. I can see things that maybe other folks can't see, and that is a that is a in some ways a gift.

type of gatekeeping. And what I struggled with was, Ah, I'm not I don't want to get on my soapbots too much. But what I struggled with was the well intentioned gatekeepers, often white. Their version of what they liked to see was black pain. And sometimes those of us who are coming from the experience don't just want to see that. We want to see us having fun. We want to see us being the Cosby's. We want to see us making money, we want to see us in love.

We don't just want to see that. Oh, I feel so bad about what happened during slavery or during civil rights and the black pain experience. What about the black beautiful fun experience?

you can make it anywhere. Kind of think, if we say it's great and we think you're great, then you're great. And that was like if you rub the stone at the Apollo and you made it there, forget about it. We don't care what the rest of the world says. We know you're the best because we are tough critics. And I remember when Ava Duverney was our publicist, and I remember Ava sitting in the theater we were watching dream Girls. Her mom's next to her, and she goes,

you know, I really want to make a movie. I go, well, Ava, we got Urban World. Make it. We'll premiere it. And she made her first short film and almost every film Ava's ever made, she's come back to Urban World and Showcase. So it's it was our moment to move civil rights from music to film, and an Urban World was that thing to help make that happen.

When you go to France, or you go to England, or you go to Hong Kong, those kids are where wearing Jordan's They're wearing Kobe's shirt, They're watching Black Panther. It's like we are what they are most proud of. And when you think of the possibilities of America, the Black experience is the one that everyone holds up as, Oh, that's why I want to go there. Sure you can be a doctor or a lawyer or whatever, but we have such a unique experience about coming from the bottom

up that that is one of America's greatest exports. And yet why would you want to kill that? People love the idea of coming here because of those possibilities, and they see it in music and film they love walking around Brooklyn, knowing the streets where so much of hip hop, and coming to the Blue Note and seeing jazz and seeing all of these things where constant waves of our

experience dominate the world code. So I just I think it's really important about that's what God gave to us to share to the world.

drum machine and you can do all this stuff. And this seventeen eighteen year old kid has a demo and the head of music at Warner brothers went to see him, and it's Prince. And he asked, Prince, who played on your album? And he said, I played all the instruments, okay, But he had the drum machine, he had the task Can four track, he had the synthesizers, he had the guitar, and he sang, and you could now go and make an album r at least a demo in your bedroom, okay.

And what that did, and the sampling and being able to sample music and put the samples in the keyboard exploded music. So what do you think is gonna happen when filmmaking gets affordable, that kids in bedrooms can now make movies. The same thing that happened with hip hop is about to happen with the longer visual form of storytelling. And you can't stop it. And that's what I talked about during my ted Ai talk. We've seen this before

in technology with music industry. You can make you can make a full album off of your iPhone right now, right So the distance between what you imagine and what you you believe to happen, the distance between those two gets shorter and shorter and shorter. And AI is going to make that and it's going to bring the cost way down. Movie making is a very rich person's game. You're about to make it that kids are going to blow our minds with the place that they're going to take us.

artists mature up. Prince didn't just stay recording in his bedroom, right, And when you saw many synthesizer bands, the ones who survived, they all went to real instruments, and you saw bands who hadn't used synthesize or pre recorded stuff go the other way. So why do you see Christopher Nolan and

others shooting on imax and shooting on film stock. Why do you see that because they look at the masters that came before them, and there's stuff that they want to do, and they play with the technology and they go forward and backwards in time, and that's how all art is, you know, And so I'm not worried about it. Artists, artist tools change and change and change and change, but we are still connected to the artists and their journey

and experience. And a robot or an AI system still needs to run through the human, you know, vessel that we as people will care about, right We want to know where you're from, what block you grew up on, what trials and tribulations you went through to make this piece of content. And that's when when the audience will care if you If it's just I spit it out on my computer, no one's gonna care, you know, we don't. We didn't care if Whitney, Houston are are what do

you call? Dolly Pardon wrote I Will Always Love You. But when that song came out through Whitney, we heard we heard her mother, we heard Dion Warwick, her aunt, we heard her church upbringing, We heard all of that come through Whitney, and you can't replace that, you know. That's the part that I think is very special.

then the sample wasn't cheating. The sample was. I'm gonna I'm going to bring another world, this white experience, into our black experience, and show you how they're the same. I'm gonna have Annie tell you it's a hard knock life. And then I'm gonna pull Brooklyn in here right well that that pollenization is so beautiful and we've been doing it forever, so I'm again I'm not overly worried or

concerned about it. We love authenticity and artists are going to have to be authentic in their own way, whether you're using voice samples or whatever. And we know the real deal and what we want because we get goosebumps when.

and other things, we're even changing the space more. But it was such a How often does a founder get to go buy their baby back and relaunch it, you know, it just rarely happens.

just boom, here's my movie past. Let's go, you know, And that's what's really exciting, where all of the others you can only go to just that theater, that theater chain, but Movie Past you go wherever you want. So it's still a beautiful thing. And we are continuing to grow it and love being that epicenter for fans and fan fandom, if you will, and being able to have that voice for so many people.

six o'clock at night? Are where to go see a movie? You go see a horror film, go see it uptown that's what you finished, right right. It's like there's places that you're gonna get a whole different experience if you go do things in different ways and help educate people on how to how to watch movies. It's a whole different thing.

I'm your host, bridget Todd. If you want to help us grow, rate and review.