Chicken Soup appeals to fans for stock offering

August 7, 2017 GMT

Chicken Soup for the Soul got its start by publishing stories mostly authored by everyday people hoping to share their memorable moments with a wider audience. This summer, the Cos Cob-based company that’s since expanded into numerous industries announced its first stock offering, and it’s not straying far from its roots in the process.

Using a Regulation A+ initial public offering, Chicken Soup for the Soul is marketing 900,000 shares of Class A common stock in the entertainment portion of the company to many of the same people who grew up reading its books.

Using a method that Chicken Soup chief executive Bill Rouhana terms as “Chicken Soupy,” the relatively new sort of stock offering his company chose allows for fans to buy stock alongside traditional Wall Street investors, he said.

“We try to act like our brand would imply,” Rouhana told Hearst Connecticut Media in an interview. “Usually in traditional public offerings, individual investors don’t get a fair share of the offer — institutions get most. We wanted to level the playing field, so we allocated 900,000 shares of 2.5 million to first-come, first-serve public approach, which we’re doing through crowdsourcing. That was meant to make it more Chicken Soupy. ”


The company plans to list its stock for $12 per share on the Nasdaq Global Market under the ticker symbol CSSE. Chicken Soup for the Soul will retain majority ownership of 70 percent over its Chicken Soup for the Soul Entertainment division.

Offerings made under Reg A+ equity crowdfunding rules face fewer regulations than traditional IPOs and have only been possible for two years. Under the 2015 Jumpstart Our Business Startups Act, this IPO alternative was passed by the Securities and Exchange Commission “to facilitate smaller companies’ access to capital,” according to an SEC statement published at the time.

Chicken Soup has been marketing the stock offering to its millions of fans for several months. The company set up an online registration process for individual investors to sign up to buy stock, but “processing it all has become a challenge,” Rouhana said last week.

The original signup deadline for its common stock was set for July 31 he said, but due to “thousands of inquiries,” the deadline has been pushed back to Friday.

“We’ve taken to calling every person and walking them through the process so we don’t leave anyone out,” Rouhana said.

The entertainment portion of the company that’s going public is what Rouhana believes has the potential to be the “fastest-growing and largest” part of Chicken Soup, he said. The entertainment division includes its video platform, which Rouhana wants to build up as an on-demand streaming service.

“The video portion will be available to consumers kind of like Netflix but will cover subjects that are Chicken Soupy, like family, home, self-help, hope and inspiration,” he said. “The same stories as our books but through shows.”

It’s yet to be decided whether the platform will be monetized through selling advertisements, subscriptions or both, Rouhana said, but he’s considering a similar approach as World Wrestling Entertainment’s online business model, which has more than a million subscribers paying around $10 per month, he said. “Their fans are passionate and so are ours.”

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