Dolphin Entertainment Inc

NASDAQ:DLPN

Greetings. Welcome to the Dolphin Entertainment Fourth Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]. I will now turn the conference over to your host, James Carbonara of Hayden Ir. You may begin.

Thank you, operator. With me on the call are Bill O'Dowd, Chief Executive Officer; and Mirta Negrini, Chief Financial Officer. I'd like to begin the call by reading the safe harbor statement. Please note that statements made on this call are not historical facts that are not historical facts may be forward-looking statements. significant risks and uncertainties that could cause actual results to differ from those expressed or implied in the forward-looking statements are detailed in the company's annual report on Form 10-K and supplemented by subsequently filed quarterly reports on Form 10-Q as well as in other reports that the company has filed with the SEC. Any forward-looking statements made on this call are made only as of today's date, and the company does not undertake any obligation to update or supplement any such statements to reflect subsequent developments. Now I would like to turn the call over to Bill O'Dowd, CEO of Dolphin Entertainment. Bill, please proceed.

Thanks, James. That was the shortest safe harbor statement you have ever read in your career. I know people are hoping you'll come back at the end of the call. Hi, everyone. Good afternoon. Thank you for joining us today. As always, we'll start with a review of some financial and operating highlights, followed by a full financial review and then open it up for Q&A. So from a financial highlights perspective, revenue for Q4 was a record $12 million quarterly revenue record for Dolphin Entertainment, an increase of 8% year-over-year. I'm immensely proud of the Dolphin team. We managed to achieve its best revenue quarter ever despite enduring 2 prolonged industry-wide strikes. Even more impressively on the bottom line, the team delivered positive adjusted operating income of $300,000 in the face of such headwinds. This is very important to note. So I'm going to pause here and add that adjusted operating income is the primary metric by which we measure our business. It's what I look at first in any P&L I received from here. We define adjusted operating income as our operating income or loss after removing any noncash or nonrecurring income or expenses. In other words, if you go to our reported operating income or loss and back out all noncash and nonrecurring items, how did we do. Reporting positive adjusted operating income is extremely gratifying, obviously. And now that we have our super group complete with the acquisition of special projects and with our expectation of continued synergies and organic growth, combined with the launch of our ventures in earnest, we believe that we will continue to have and expand positive adjusted operating income on a continuous annual basis. Very exciting. And it's good to share with everyone how we look at our business and the metric if it's a non-GAAP metric that we use. So Speaking of special projects. I know we discussed the acquisition at length on our Q3 call, but the transaction did happen in Q4. So just a couple of more bullets on them. As a brief refresher, I'll just point out the special projects founded by the amazing industry leaders, Nicol vecureliand and Andrea Oliveri, is a leading agency in talent bookings and celebrity curated event production with offices in Los Angeles and New York. Their impressive client roster includes top brands like Apple, Chanel, Conde Nast, Wall Street Journal, among many, many others. With this strategic addition, Dolphin aims to launch or partner on our own live events as well as capitalize on cross-selling opportunities and synergies across our various companies. And speaking of our other companies, I'll now turn to some operating highlights. 42West helped clients secure 4 wins at the 96th Academy Awards and received 2 dozen nominations while boosting global interest for the Bonten and Godzilla minus 1. I'm going to go off script for a second because I just got to give a public round of applause to the 42West movie promotion team. The Boy and the Heron was a tremendous achievement to win an Oscar for in the animated motion picture category. I don't know if that's the first time or must be one of the first times that a movie that was at American on that category to beat out Spider-Man animated movie was a real achievement. Congratulations to that 42West team and a separate team was promoting Godzilla minus 1. Best visual effects Oscar is what they want for that entire movie had a budget of $15 million. And I think every movie they were competing against had a visual effects budget of bigger than $15 million, a tremendous job getting the academy to see the movie and promoting the highlights of the visual effects, so great job 42West. Moving to Shore Fire, which also continuously does create elite PR work, representing clients who collectively received 9th Grammy Awards and over 2 dozen nominations across various categories, showcasing its rosters diversity and multiple genres. At major industry events that recognize both film and music each of 42West and Shore Fire Media regularly represent their clients. This was evident in Q4 and year-to-date with both agencies orchestrating over half a dozen PR campaigns for clients at the 2024 South by Southwest Film Festival a couple of weeks ago, and they also achieved notable success at the 81st Golden Globes, contributing to clients securing multiple awards and receiving over a dozen nominations. I love it when our agencies work together and have success at war shows like that. The Door switching to them, celebrated 8 consecutive years, representing the Food Network, New York City Wine & Food Festival presented by Capital One. Additionally, they added new client Giadzy from Giada De Laurentiis, the Emmy-award winning television personality, New York Times best-selling cookbook author, what does she do restauranteur and entrepreneur. They added Giadzy from Giada to its growing roster of elite culinary clients and lifestyle brands, special shout out to Charlie Lowell come up on this call. Okay. Now let's talk about the digital department. I pointed out in our letter to shareholders in January that this will be the subsidiary of focus for expansion during the next few quarters, at least. We believe that there is such an opportunity in the marketplace to establish the first fully scaled influencer management company with the ability to service brands and creators of all age groups and all major social media platforms and in a variety of specialties. To that end, we had 2 major announcements in Q1. First, the digital department brought in the influencer roster of Glo lab to introduce a specialized talent management division catering to skin care experts and dermatologists led by GlowLab's Founder, Susan Yara. Susan is an extremely successful skincare influencer herself with her own YouTube channel, and she is also founder of Naturium, a skincare product line, which was sold for the low low price of $355 million to e.l.f. Beauty in September 2023. I'd point that out because part of the strategy of inviting Susan and her roster to join the digital department is to help us conceive and develop partnerships to launch skincare products in which we have an ownership stake. Obviously, Susan had a very successful exit herself in just over 3 years. In other words, Naturium launched in June of 2020, and was sold in September of 2023 for $355 million. It's also worth mentioning that Naturium's marketing during those 3 years was almost exclusively influencer marketing and PR, both of which are obviously strength of Dolphin. I'll dispel any miss. We did not enter into the agreement with Susan to put James Carbonara as the face of new skin care product line, but we are excited to launch skin care products. In addition to bringing in GlowLab, the digital department also established a Young Adult division, a YA division, as we call it in partnership with the Osbrink Agency. This was also a highly strategic move for us. You probably saw the announcement in February. GlowLab was back in January and immediately enhances our reach across TikTok and YouTube to complement our current strength on Instagram, and it launches an entirely new age group of influencers for us, teens and young adults. We did so in partnership with the Osbrink Agency. Which is Hollywood's premier talent agency for that age group. Cindy spring, someone I'm proud to call a friend, the founder of the Osbrink agency is nothing short of a legend. Having launched the careers of hundreds of young actors over the past 25-plus years, including Dakota and El Fanning, and literally dozens of lead actors across Nickelodeon, Disney Channel and Feature Films. Unlike 25 years ago or even more recently when we were producing movies and series for Nickelodeon, there is now a thing called social media. I'm joking, of course. I'm sure you've heard of it. And so many of those same talented teenagers and young adults of today have TikTok feeds and YouTube channels of their own. Simply put, we want to represent them, and we want to introduce them to brands. And by partnering with the Osbrink Agency, we just saved years of development time for that division and went from 0 to 60 million maybe even to hundreds in the snap of our fingers. We announced the partnership, as I said last month, and we already have more than 3 dozen of these young talented social media stars on our roster, and we can't wait to introduce them to our existing brand partners and to new brand partners we will meet who will want to reach this important demographic. Viewpoint Creative announced an extensive partnership with the Massachusetts State Lottery, specializing in digital graphic design and animation services. And they also received congrats Dave and the team for us awards for extraordinary craft that shapes compelling narratives and leaves a lasting impact on audiences. And finally, special projects hit the ground running at Dolphin, partnering with the Academy Museum of Motion Pictures for its third annual Gala and continued collaborations with the Wall Street Journal Magazines. Innovator Awards, great job booking Travis Kelsey again and is talent booking partner and entertainment consultant for Town & Country's Annual Philanthropy Summit, which I attended by the way, going off script again and a special shout out to Charles Darren and the great work she's doing in her native South Africa. It was very impressive. They also collaborated with Chanel, Gucci and Valentina on their respective boutique openings in events during New York Fashion Week in February as well as an entire slate other events during Oscar's Week, which we'll highlight on our Q1 earnings call in 6 weeks. We got to say something right.Shifting gears, I'll now provide updates on some of our ventures and which Dolphin and its shareholders participate. So I'm going to turn first to Blue Angels because what a week for that, right? As some may recall, Dolphin entered into a multiyear agreement to jointly finance the development and production of a slate of feature length documentaries for the global market. The first project greenlit was the Blue Angels we announced it a couple of years ago at the Comtel Festival, developed and coproduced by JJ Abrams and his company bad robot productions; and Glenn Zipperis company, Zipper Brothers films. We then announced that Amazon Studios had acquired worldwide rights to the Blue Angels wherein we expect it to generate approximately $3.75 million to Dolphin from the acquisition agreement, which would result in a 75% ROI before the inclusion of any revenues to dolphin from the ticket sales from IMAX institutional theaters, providing powerful validation for our model of also taking equity in projects we market. We're very excited for this film. It has turned out great. And so our partners, Amazon has secured an exclusive trailer debut and promotion on the today last Wednesday. Thank you, our partners in Amazon, very well reviewed clip that is extremely that type of promotion, by the way, for those curious, that is extremely rare for documentary. I just ask any of you. When was the last time you saw a trailer drop for a documentary on a morning show. When you remember, please let me know. And let me tell you the trailer has been a hit. Over 1.7 million views occurred in the first 24 hours. And as of today, a week later, we're over 9 million views. I believe this has to be one of the highest totals if not the highest total for documentary feature in the 28 years I've been in this business. And of course, it does not count the number of times the trailer has been viewed ahead of movies in theaters. IMAX has placed a trailer ahead of dose busters in many locations this past week, and it will be ahead of the Godzilla King Kong movie that premieres tonight in many locations across the country as well. This precedes the beginning of an exclusive run in IMAX theaters starting May 17. What do you do on May 17? I hope you're going to the movie theater see in Blue Angels. It's a Friday, you'll love it with availability for streaming on Prime video beginning May 23, right ahead of Memorial Day weekend. Our success with Blue Angels is the result of a deliberate strategy to create event documentaries on subject matters you want to see in IMAX theaters. Putting an IMAX camera in a fighter pit and literally seeing the neighboring jet only 12 inches away I cannot describe it. Fingers crossed, we think we have something special. And the importance of a theatrical release in enhancing the film's value for streaming platforms cannot be overstated, given the preestablished audience awareness as theatrical release provides. Our deal with IMAX is significant for 2 main reasons. Firstly, it laid the groundwork for the robust streaming sale, which has been extraordinary. Secondly, there's an annuity benefit due to IMAX's ownership of theaters and museums and generally institutional theaters as we call it. We are eligible to showcase our film in IMAX institutional theaters, 6 months after premiers on Amazon. This means that as of November 23, the film can be presented at the Smithsonian Aviation Museum and an additional 150 theaters across America. This arrangement creates a steady income stream and annuity, which is quite remarkable. I wanted to make sure everyone understands the significance of this. In terms of financials, we retain a high percentage of ticket sales, roughly 25% since there's no distributor involved. For instance, in a theater with 200 seats each ticket sold at $10, that's $2,000 in revenue from which we would earn $500. That's just from one showing in one theater and there are 150 theaters in the country, and 365 days in a year. So considering the film's potential to run for part of or the entire year in various museums, this is expected to continue for the next decade or 2 to come given the scarcity of this type of content and institutional venues. Furthermore, with the version of the film being shown in institutional theaters being only 44 minutes long versus the normal 90 minutes that we'll have on May 17 in traditional theaters. We can fit in more showings per day. These details are crucial for stakeholders to understand the financial implications. You might ask what's the value of the movie institutional theaters. And while it's challenging to specify an exact figure, we anticipate this could generate hundreds of thousands of dollars annually, if not more, contributing directly to the bottom line since the film has already recouped its investment. So in addition to the 75% ROI from the streaming sale and our participation in ticket sales for the initial theatrical run beginning May 17, we also gained this annuity with post-streaming run beginning in November. Very excited for Blue Angels and if you haven't seen the trailer yet, I hope you get a chance to check it out online right now. Switching gears, excuse me, to Mastercard Midnight theater. For those unfamiliar, Mastercard Midnight daters a state-of-the-art contemporary variety theater and restaurant experience in the heart of Manhattan in a neighborhood Dove Manhattan West. Dolphin is a managing member in the venue and is responsible for the marketing of both the theater and the accompanying restaurant. We have a meaningful ownership stake in Master Carbon at night theater as well. And it's been very gratifying to see the menu attracting high-profile events and partnerships with major brands like MasterCard. The STAR study Premiers with Jessica Chastain, Pat Davidson, Kaley Cuoco, and Kevin Trent, showcase the theater's ability to draw top talent and create exciting synergies with our PR firms. However, since our grand opening last September and especially in the typically slower first quarter period, operations across the restaurant, the cafe downstairs on the theater have not met our expectations and as well understood that without a profitable restaurant is challenging to make the venue successful. So we have prioritized our search for a new operator with a new restaurant concept that can best attempt to revitalize this space going into the key summer and fall seasons. While there's no assurance that any deal will close, we have identified the group that we would like to bring in, and we are working hard to close a deal in the next few weeks, acknowledging the challenges of the past 6 months and facing the uncertainty brought about by this potential change or whether we can make a change at all, we decided to impair the asset value we had on our books, viewing it as an opportunity to reset and potentially avoid future financial overheads. Turning to our new adventure. We are proud to share that Dolphin Entertainment is partnered with renowned culinary personality and client Rachael Ray and the esteemed Do Good Spirits distillery to launch Staple Gin. This collaboration brings together Rachael's culinary expertise, Do Good Spirits craftsmanship, and Dolphin's marketing prowess to create a unique and promising addition to the spirits market. Staple Gin is the result of Rachael Ray's passion for creating flavorful experiences and our decades of culinary knowledge. The botanical recipe developed by Rachael herself promises a balanced and intriguing flavor profile that reflects Rachael's signature style. Our subsidiary, the door, which has represented Rachael Ray's since 2008, and Charlie and Lois have worked with her since 2005 has been instrumental in bringing this project to life, the Doors team has leveraged their extensive experience in marketing wine, spirits and consumer packaged goods as well as their long-standing relationships with culinary personalities and restaurants to contribute to all stages of Staple Gin's development. From branding to marketing, PR and trade relations, the door has played a crucial role in positioning Staple Gin for success. To generate buzz in anticipation for the launch, Staple Gin made its first public debut at 2 prestigious events, the New York City Wine & Food Festival and the South Beach Wine & Food Festival. Rachael Ray herself was present at these events, pouring sits for attendees, while Do Good Spirits mixed up the Staple Gin cocktails. The response from those who have the opportunity to taste Staple Gin has been overwhelmingly positive, further validating our confidence in this new venture. Staple Gin is set to come to market here in Q2, initially in New York State and bars, restaurants and retail destinations with plans to expand to additional markets in the future. We are thrilled to be part of this collaboration and to utilize the full range of marketing PR capabilities that Dolphin Entertainment offers. We believe that Stable Gin has the potential to become a staple, no pun intended, that was too easy, right, in home bars and a go-to choice for classic cocktails like the Ganatonic or perfect Martini. We are incredibly excited about the potential of Staple Gin and our partnership with Rachael Ray is just absolutely lovely. As you may know, Celebrity-Backed spirits brands have seen tremendous success in recent years. Just look at the example of Ryan Reynolds Aviation Gin exited more than $0.5 billion and George Clooney tequila brand, which sold for $1 billion. Moreover, it was reported last month at the potential value of twinning the Dwayne Johnson Teremana Tequila may be significantly higher since it is moving over 170,000 cases per month, which is a staggering number, good for him. So as you can see in success, big numbers are possible with Celebrity-Backed Liquors may we be as lucky. While we can't promise the same results, of course, we believe we are playing in the same space and have the marketing expertise to give Staple Gin the best possible chance for success. And I just want to add that our fantastic team at The Door, and again, Charlie, really spearheading this has its own share of experience and success stories in the space, working with liquor brands from creation through successful exit, including recent examples of Jefferson's Bourbon, which was sold to Pernod Ricard in 2019 and 21 Seeds Tequila, which was sold to Diageo in 2022. So we're not exactly foreign to the journey. And as many of you know, our company is always looking for innovative ways to leverage our marketing experience and expertise and create value for our shareholders. The Staples Gin partnership is a perfect example of this strategy in action. And I want to emphasize that this venture, like many of our other ventures does not require any capital expenditure from Dolphin. We anticipate this will be the first of many ventures in the Alcoholic beverage phase for Dolphin, and we expect to pursue similar deal structures in the future, where we provide our marketing services in exchange for a share of the upside without capital investment. As we continue to pursue these types of ventures, we believe the economic benefits to Dolphin will be substantial. We look forward to sharing more details on the Staple Gin partnership and our other upcoming ventures in the spirits space. We believe this is an exciting new area of growth for Dolphin, and we are well positioned to create significant value for our shareholders through our marketing expertise and innovative deal structures. There will be much more to come on Staple Gin in our Q1 earnings call. Okay. Those are some highlights about our ventures division and circling back then in summary, in Q4, Dolphin Entertainment achieved record quarterly revenue of $12 million and positive adjusted operating income of $300,000 despite the impact of twin industry strikes for the first time in over 60 years. All of our subsidiaries secured high-profile clients and partnerships. And we also acquired special projects. That's the highlight of the quarter for me, which completes the original vision of what we now call the Super Group. And lastly, with special projects added to the fold, we have positioned the company and our shareholders for upside from all 3 categories of Dolphin Ventures, content, consumer products and live events. The first piece of content, the Blue Angels documentary hits theaters in 6 weeks and is already profitable from our sale of streaming rights to Amazon Prime, where debuts on May 23, as I mentioned. For the consumer product category, we have Staple Gin hitting the market here in Q2, and we couldn't be more excited. And for the live events category, we are actively ideating with special projects Coland Andrea and expect to be able to announce the idea for our first owned event by the end of this year or in early 2025. All of these ventures will leverage our marketing expertise, and we expect the majority of them like Staple Gin, will not require capital investment from us. So for all of these reasons, Dolphin Entertainment is well positioned for growth and success, we believe, focusing on creating shareholder value through innovative partnerships and deal structures, while running a sustainable operating company focused on generating increasing adjusted operating income. Thank you for your continued support, and I'll now turn it over to Mirta.

Thank you, Bill, and good afternoon, everyone. I will now discuss financial results. Total revenue for the fourth quarter ended December 31, 2023, was $12 million, an increase of 8% over the same period in prior year. Adjusted operating income, as defined in our earnings release for the 3 months ended December 31, 2023, was approximately $300,000 as compared to adjusted operating income of approximately $100,000 for the 3 months ended December 31, 2022. Operating expenses for the 3 months ended December 31, 2023, were approximately $20 million, including approximately $8.3 million of noncash or nonrecurring expenses compared to $14.1 million of operating expenses for the 3 months ended December 31, 2022, including approximately $3.1 million of noncash or nonrecurring expenses. Operating expenses for the quarter ended December 31, 2023, are composed of direct costs, payroll and benefits, selling, general and administrative expenses, acquisition costs, goodwill impairment costs, depreciation and amortization, write-off of notes receivable and legal and professional fees. Direct costs for the quarter ended December 31, 2023, were approximately $300,000 compared to approximately $600,000 for the quarter ended December 31, 2022. Payroll costs were approximately $8.9 million in the fourth quarter of 2023 compared to approximately $8 million in the fourth quarter of 2022. SG&A expenses were approximately $2.4 million in the fourth quarter of 2023 compared to $1.9 million in the fourth quarter of 2022. Acquisition costs were approximately $100,000 in the fourth quarter of 2023 compared to $200,000 in the fourth quarter of 2022. During the fourth quarter of 2023, we impaired goodwill by approximately $3 million as compared to $900,000 impaired in the fourth quarter of 2022. Legal and professional fees were approximately $500,000 in the fourth quarter of 2023 compared to $600,000 in the fourth quarter of 2022. Operating loss and net loss for the quarter ended December 31, 2023, of approximately $8 million and $9.6 million, respectively, include noncash or nonrecurring items of approximately $8.3 million and $9 million, respectively. These include a $3 million impairment of goodwill, approximately $600,000 of depreciation and amortization $400,000 of bad debt write-off, $100,000 of acquisition cost and write-off of our notes receivable and midnight theater in the amount of approximately $4.1 million. The net loss also includes losses from equity investments of approximately $700,000. This compares to an operating loss and net loss for the quarter ended December 31, 2022, up $3 million and $3.3 million, respectively, which included noncash and nonrecurring items from depreciation and amortization of $500,000, $900,000 of goodwill impairment, $200,000 of acquisition costs and $1.4 million of changes in the fair value of contingent consideration. Net loss also included approximately $100,000 in losses from equity investments in affiliates. Loss per share was $0.54 per share based on 17,632,822 weighted average shares outstanding for both basic loss per share and fully diluted loss per share for the 3 months ended December 31, 2023. Loss per share was $0.29 per share based on 11,256,578 weighted average shares outstanding for basic and fully diluted loss per share for the 3 months ended December 31, 2022. Cash and cash equivalents of $6.4 million as of December 31, 2023, as compared to $6.1 million as of December 31, 2022. That concludes my financial remarks. I will now ask the operator to open the phone line for questions. Operator, would you please poll for questions?

Thank you. [Operator Instructions]. One moment please while we poll for questions. [Operator Instructions]. The first question comes from Allen Klee with Maxim.

Congratulations on the quarter. Starting off with 42West, and you mentioned that despite headwinds from the 2 strikes you still perform well. How do you think about how that business will normalize in '24? And maybe how much of the headwinds there were in '23? And maybe how much might go away in 24?

Sure. Thanks, Allen. Yes, we feel we had a great quarter, too. Well, the writer strike that started in May wasn't as impactful to our business. The AFTRA strike that started in July was very impactful to our business because actors weren't allowed to promote movies. So the student double way, I mean, on us because some of the actors took hiatus. They had nothing to promote. They weren't allowed to promote. So they went on hiatus from our talent division. But then our movie division, many of the studio films and in penta films that were going to be released in the fall were pushed till 2024 and pushed everything back. So if I'm just being honest, it's a little remarkable to me that the fourth quarter finished as well as it did, almost $1 million more than any previous quarter of the company because so much of our drug and movie business was pushed out. Obviously, nobody wants to release a movie if the actors in the movie can't promote it, right? So even though the strike ended in November, many of those movies that pushed out of the fall, September through December, weren't even put into the theaters in January or excuse me, in Q1, that it will probably fully normalize by the end of Q2 is my guess. And we're doing fine. The impact is lessening every month, but it was an impact in Q4 and very proud of the team for the results against those headwinds.

That's great. For the digital department, fourth quarter is usually the seasonally strongest. Can you talk about kind of how you felt about the performance in the quarter? And then with the addition of Glowlab and AY, can those be meaningful contributors to the department and the company overall in '24 in your view?

Yes. I'll go and know where you asked the questions, but a resounding, yes, on the second one. Yes, digital apartment had a strong Q4. They hit their goal. I'm also proud of that team to Ali Grant Cerebos, Kirson Weinberg, Belinda Strong because we merged them, pre-social and social late in September. That's a heavy lift. Anybody that tells you differently is just has never done the process. And it's a big distraction to management. We really wanted it to be done in September because going into that fourth quarter, which is the heavy selling season, you didn't want that hanging over your head and you certainly didn't want to do a merger in Q4, right? And rebrand the company. And so they did all of that work and then still maintain a very steady ship in Q4. Very happy with the results of the digital department at the end of the year there. Going forward, I really tried to make it an emphasis and kind of signal to the market that this is an emphasis for us is the growth of the digital apartment because it has so much growth potential. I've talked about it on many previous earnings calls. We're starting to realize that growth now because GlowLab, as an example, that's when you bring in a team. And Susan Yara built a nice little influencer marketing company with 15 dermatologists or so. And that just immediately establishes a skin care group and brands pay big for credible authentic voices in that space. And we think there's room to grow in that space. The beauty category in general, skincare is a big component, but hair care is even bigger. Cosmetics is a separate category, just to give you a sense of how big this could get for us, and we're excited to expand that group by itself. And then I made a point to mention that Susan created a product, launched it in COVID and sold it 3 years later for a great exit because she's living proof of what we're trying to do with our ventures. And skin care is going to be one of the 2 pillars in beauty and cosmetics generally as well a beauty category broadly will be one of the 2 pillars for us, along with liquor, where we feel like once we get it up and running, we can be launching a product a year. So it was a highly strategic move for us to bring Susan and her group in and very blessed about that. That will be immediate revenue. There are 15 influencers, that's immediate revenue for us, plug-and-play. The YA space, thankfully for that partnership with Osbrink because while we very much wanted to add teams and young adults to the digital department, if we had built on influencer at a time, hiring a manager and do that, it could have taken us no less than a year, probably closer to 18 months to 24 months just to have a viable roster 10 or 12 working clients that are meaningful in that space. With Osbrink, we feel like we just represent that roster for digital overnight. You've got 2 dozen teams and own adults that are on TV shows or Moody's. And it's just such an advantage because they all have social profiles, too. So we're excited to be able to start monetizing that probably in earnest here in Q2 as we put the roster together between February and March. I'd say that's the timing of those 2 and when they'd have an impact.

One follow-up on digital department. And this is, I don't know how you answered those what the probability is much are governments talking about potentially maybe banning TikTok or making it harder for them to operate here? How do you think about that? Like if that happens, it's probably well, I don't know how to put out. But how do you think about if that happened or what impact that might have?

Well, for us, yes, I take no position on whether it will or won't like as you gather too. I don't know. But it will really come down to individual creators. Let me back up. The digital department has 3 divisions. We manage individual talent and take a percentage of their revenue. We have a brands division where we represent brands and design, influencer marketing campaigns for them and execute them. And we have an events division. The events division platforms don't impact us. On the brand side, the brands will just adapt and then shift their ad dollars from a TikTok campaign to an Instagram campaign or a YouTube campaign, and we'd be managing it anyway. It won't have an impact. On the talent side, there will be some talent out there in the world that are only on TikTok or primarily on TikTok that will be impacted because we'll have to transfer their following over most likely to either, well, most likely YouTube as a video platform. And that may take some time or for the followers to move over with them. But in today's world, time might be a day, 4 days. But fortunately, for the digital department, we're weighted heavily on a platform of that platform's Instagram, and what we want to do with moves like this YA roster is diversified and get a little bit more balanced with TikTok and YouTube and if there is no TikTok then YouTube and whatever comes next. So fortunately, they shouldn't have much of an impact on us at all if Tiktok goes away.

I'm excited about Blue Angels coming out as a lot of people are I'm curious, it looks like the time that it will be in the IMAX theaters is shorter than what I thought. Was there a different thinking of how long will it be in IMAX versus then going to Prime?

Well, that's not that, and I apologize, we could have made that clear, Allen. It's not that it leaves theaters. It's just that it's only in theaters for that first week, and then it can continue its run. So I understand Amazon at first was debating is it a July 4 release or a Memorial Day release and Memorial Day weekend as such, it's the kickoff of movie watching and moviegoing and it'll be on top of mind for everybody is generally the kickoff of the summer season, right? Not that some of the ventures movies didn't come out earlier, and some of the big temples are again this year. So they just didn't want to lose the Memorial Day weekend for their opportunity as well. So we certainly understand that. That's the weekend we premier top gun 2 years ago, may fighter jets be in vogue this Memorial Day. And the Blue Angels themselves have some high-profile shows in real life over that weekend as well. So we know we can promote the sugar out of this film on that weekend. So the thought was launched it exclusively in IMAX May 17, let it run as long as it intends to run in other theaters, potentially too, after that first week when it's only available in IMAX, but then have Amazon be able to have fewer ship numbers that capture that type of excitement around the film.

That explains it well. And then with IMAX, how are you thinking about maybe the next partnership, the next movie, is that likely a 25 event? Or how do you think about that?

Yes. We think so, too. Yes, we do think that way. Shockingly, you're as I'm sure, for yourself, big surprise, you're not the first person to ask how man, this is so great. What's next? And we're excited to hopefully share what the next partner movie with IMAX will be as soon as we can. You can imagine with this, and there's no shortage of people looking to partner because maybe to go back a step, it's worth noting, too, I think I said it on his earnings calls. When we form this partnership, I'm unaware there is to my knowledge, there's no other deal in the market in the industry, where there's a guarantee teas release for documentary and with IMAX and Dolphin, we're both thinking about how can we bring something new to the marketplace and this idea of, for lack of a better word, big spectacle documentaries we're going to have to come up with a catchy phrase for that, but like with Super Group. But the idea of Blue Angels or something like that in IMAX, it's not your father's old mobile, it's not your father's through prime documentary. It's theatrical. It's big. And this movie delivers on that promise. It's a great first movie in that sleep. So when you've got a hit out of the gate and you've got something different like that, then it's really just a matter of choosing what do you want that next big one to be that hopefully you don't suffer a soft more slump, right? And it's as eye grabbing as seeing fighter jets 12 inches apart from a camera that's 12 inches apart, not from the ground, right? So yes, we think that we'll have an announcement obviously this year for what could either be filmed or released in 2025 and start getting to a regular cadence with it.

That's great. For MasterCard Midnight theater and hidden lead, your comments there of looking to change the venue of midnight of hidden lead. When you're saying that didn't perform to expectations were you referring just to the restaurants or the restaurant and master part mid-tier?

Well, we really do want to try and bring in an operator for the restaurant. It's very hard to have a successful venue, including theater if the restaurant is not hitting its goals. And so it's an opportunity to kind of reconceptualize and maybe bring in a bigger operator, especially because you're coming out of the historically slow Q1, right, restaurants in Manhattan and anywhere in the Northern City don't do as well in the winter as they would in the summer or fall, right? So people just don't go out as much. So it felt like the right time to put in a new concept, if we can. So that's why we've prioritized the search and we are talking to groups and actively now to see if we can come up with a new concept for the key summer and fall seasons. Now there's no assurance that a deal will close, but we have identified the first group that we'd like to bring in and working hard to close the deal in the next few weeks.

That's great. I'll just finish up a quick one I have a few financial questions. You haven't given guidance. Are you able to give anything qualitatively if you think you might be able to grow revenue? And if so, what would be the drivers to that?

Sure. Well, I'm happy we beat our beloved analyst expectations for Q4. So we hope to be able to do that again here in Q1. And the 2 drivers, which won't come as a surprise given our prepared remarks for the last 3 years, right? Each year, we've added a new member of our group. It exponentially increases the amount of collaborations that can occur, right? I think Tim Johnson from Bart pointed out to me the Manatial formula to it. But you only have one company, you can't cross-sell with anybody. And when you have 2, it can only go in 2 directions. But by the time you get to 3, there's like 6 different strings to the spider web. So now we're up to effectively 6 marketing companies and an operating film production division. So we're exponentially more intricate and special projects plugs in beautifully as an additional offering. There's been goodness. I think no less than half a dozen introductions to potential new clients for special projects in the last week or 2 alone. I attended one of them, and it was extremely well received. So the idea to organically grow our subsidiaries through cross-selling and through new introductions is just very, very real. And that's why we wanted a live event company that comes out of Hollywood instead of, let's say, a nonentertainment live event company because special projects when they're doing the Motion Picture academy, the Oscars people, right? They're Gala, and that's a direct hit to some calling card for any number of people that 42West can introduce into. So organic growth will be strong, we feel. But then now look where we are with our ventures. We've talked about it for a couple of years, but now we have all the pieces in place. to have a really strong pipeline of ventures. Q2 is going to be pretty big. That next earnings call on May 15. We think we're having a strong Q1. We have a film coming out 2 days later from May 15. We'll have a liquor in market probably by the time we're on the call, in which case they want to get the sample to everybody on the call, right? So it's happening. Now we're moving to the point where these earnings calls are giving updates on those types of opportunities for Dolphin. Each one of those can represent very large revenue exits in time or immediate, like Blue Angels and that will certainly be jolts of growth that we just didn't have in past years as we were building this group, right? And if we have a couple of them in May, we might have those 2 in a couple more later in the year. And soon, you're trying to keep everybody abreast of hopefully, 6, 8, 10, 12 ventures in a couple of years, and that's very exciting for us.

Great. Okay. That's it for me.

And the springboard off that one idea, too, Allen. I'm sorry, I should have said, too, on the digital department, we announced Susan Yara and GlowLab in January. We announced a in February. We don't think we're done. So let's see if there's another announcement or 2 this year, and there's just so much growth in new spaces for the digital department. And each of those, they're not as big as a Blue Angels or having forbid a successful staple gin with Rachael Ray, but they're meaningful, and they could launch new businesses for us as well. So there'll be some announcements on that front as well, too, we think. So thank you for your time and questions, Allen.

Okay. We have no further questions in queue. I will now turn the call over to Bill O'Dowd for closing remarks.

Well, thank you. Thank you, everyone, for listening. It's nice to be here at the 10-K for 2023. I reiterate welcome to special projects. It's a company that has, in a short period of time, growing to be very special in my heart. I just think the world of Nicole and Andrea and their entire team. I'd shout I'm all down by name. I was given the time, right? Very high-quality people, very strong workers, and they've built a beautiful company. So excited for what will come with special projects, which should be more of a feature of these calls probably in the second half of the year. Overall, obviously, the company has got a little bit of a buzz about it, a little bit of a swagger given Blue Angels and the drop of the trailer and the fact that it's in theaters in just a few weeks. And the Q1 earnings call while the duking out between what we lead with, either Blue Angels or or Rachael's gin and some updates on both of those fronts. Thank you, everybody, for joining today, and thank you for the journey. I know it's a Thursday night before holiday weekend, but we couldn't be more excited for the company and look forward to the next call. So thank you all very much.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.