A Chennai-based startup has taken to its heart the bottom-of-the-pyramid concept in identifying its market niche. Jadooz, an entertainment firm, wants to take movies to the rural pockets of India through mini-theatres that will typically have 50 seats.
“We are looking at setting up 250 such entertainment zones. With an investment of over $20 million, each entertainment zone will have a mini-theatre, Virtual Reality (VR) zone and a mini cafe (where we will sell foods with local flavour),” said K. Skandan, chairman, Jadooz. “People walking in can watch a movie, have their favourite local food, and play at the VR zone without compromising on quality,” he added.
In the next few days, the startup will open the doors of its first zone in Telangana called Janatha Theatre (people’s theatre) in Ranga Reddy district. “This is a 1,000 square feet infrastructure housing a 30-seater theatre and a 10-seater café with VR capabilities,” Mr. Skandan said.
In June, Jadooz will open the first illustrative zone in a village close to Kancheepuram. Rahul Nehra, founder of Jadooz, said, “We estimate that rural Tamil Nadu is a hugely underserved and untapped market with a very high potential.”
According to him, the estimated shortfall in theatres across semi-urban and semi-rural Tamil Nadu is approximately 2,500 mini-theatres. Currently, Tamil Nadu has 1,127 operating public screens. Of this 407 are complexes or multiplexes. The total number of seats in Tamil Nadu is more than 6.14 lakh.
Mr. Skandan said that the plan is to deep-dive into locations beyond tier-2 and tier-3 towns. “In Tamil Nadu we will have movies and are also evaluating models to show web series. There is no rule book that a web series should be viewed online alone. We can bring them to theatres too,” said Mr. Nehra. His analysis indicated that the additional revenue opportunity for the State is approximately ₹2,000 crore. “We expect a double digit revenue percentage coming from this category by 2019,” he added.
The duo also believe that this will open up a huge opportunity for entrepreneurs in rural pockets. “The model is a mix of company-owned, company-operated and company-owned, franchisee-operated. So anyone who has space can approach us and if we find the location suitable we can set up an entertainment zone there,” explained Mr. Skandan.
Jadooz has tied up with the National Skill Development Corporation (NSDC) and people manning the mini-theatres will be certified.
According to the company’s analysis, an entrepreneur would, on an average, have to invest anywhere between ₹12 lakh to ₹15 lakh (varies according to location) and can break even in 18 months.