MoviePass Board Member Resigns, Claiming Financial Information Was Withheld

Carl J. Schramm has resigned from the board of MoviePass’s parent company, claiming the struggling ticketing service did not provide important information about key business decisions.

In a letter dated Aug. 25, 2018, Schramm writes that over the past several months, he was unable to obtain important details about the financial status, operations, and strategy of Helios & Matheson, the data company that owns MoviePass. It’s a period of time that overlaps with a cash crunch at the company.

MoviePass has attracted 3 million subscribers with its low-cost monthly service, but it is also operating at a steep loss. The company posted a $126.6 million deficit in the second quarter and has burned through $219 million in cash since January.

As MoviePass has struggled to keep the lights on, it has changed the terms of its service, flirting with raising prices, only to abandon that move, while also limiting the number of films that its customers can see every month. Schramm said many key management decisions were made without the board’s knowledge or approval, or were decided on during board meetings that were called with only a few hours advance notice by email.

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