A favorite Broadway motto tellingly describes this alternative investment: "You can't make a living, but you can make a killing."
Invest in winners like "Wicked" or "Rent," and you'll have a cash cow for years. Pick a loser and you can lose your investment, and many shows do fail. Why? "There is no way to predict how well the production will be received by audiences," says Ethan Bordman, a New York City-based attorney who specializes in entertainment law.
But pick a winner and your investment could multiply many times over.
However, investment minimums can be high, averaging $50,000 to $100,000, he says. For those with smaller purses, contact producers directly because they may need more capital before a show opens. Vet a show's producers, actors and directors first to see if they have a good track record.
If you decide to invest, scrutinize your contract, Bordman says. "First money in a show usually gets a better deal," because early investors take on more risk. Ultimately, every contract has varying payback terms.
Juicy perks include opening-night parties.