Before MoviePass (and since), Ted Farnsworth has had a string of failed businesses. Here's a timeline, and why he's currently in jail.
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Ted Farnsworth is the former CEO of Helios and Matheson Analytics, which previously was the parent company of MoviePass.
The documentary "MoviePass, MovieCrash" shows how he blew through hundreds of millions of dollars.
He and former MoviePass CEO Mitch Lowe are awaiting trial on charges of securities fraud.
In the new HBO documentary "MoviePass, MovieCrash," Ted Farnsworth is the CEO of the publicly traded Helios and Matheson Analytics (HMNY) when the company takes a majority stake in the movie-theater-subscription startup MoviePass in 2017.
Under Farnsworth's watch, MoviePass became a sensation after he and then-CEO Mitch Lowe dropped the monthly subscription fee from $30 a month to $10. It led to millions of subscribers and the company being hailed as the Netflix of movie theaters. Farnsworth and Lowe touted themselves in the press as the masterminds behind it all.
The documentary — based on reporting by Business Insider —reveals the more complicated reality of the phenomenon, showing how MoviePass cofounders Stacy Spikes and Hamet Watt were pushed out of the company after the arrival of Farnsworth and Lowe.
With Farnsworth and Lowe at the helm, hundreds of millions of dollars were spent to not just keep the unsustainable $10-a-month plan going, but also on lavish parties at Coachella, and starting a movie production arm best known for releasing the 2018 movie "Gotti," a biopic on notorious crime boss John Gotti starring John Travolta that received a 0% critics' score on Rotten Tomatoes.
In 2020, both HMNY and MoviePass went bankrupt (Spikes has since relaunched MoviePass), and two years later, Farnsworth and Lowe were charged with securities fraud.
As the documentary shows, the crash of MoviePass is just one of many failed ventures of the 61-year-old Farnsworth. Business Insider reached out to Farnsworth for comment but didn't get a response.
Here's a rundown of many of those companies (some of which went bankrupt), what Farnsworth did after MoviePass, and why he's currently in jail.
Note: "MoviePass, MovieCrash" is based on Business Insider's award-winning reporting on the company.
Mid-1990s: Farnsworth ran the Psychic Discovery Network, promoted by La Toya Jackson, that received more than 50 complaints from the FTC
Farnsworth's first major attention came when he ran the 900-number psychic network, which became famous thanks to its star promoter, La Toya Jackson.
A 1998 bulletin from the Federal Trade Commission noted the Psychic Discovery Network as a company that received more than 50 complaints in 1997. It had a total of 60.
2000: Auction site Farmbid.com lasts less than a year
Farnsworth tried to use the popularity of the Psychic Network and the dot-com boom to capitalize on the multitrillion-dollar agricultural business in the early 2000s with the site Farmbid.com.
A 2000 Wired story touted the company as a site that featured "farm auctions, links to wholesalers, a detailed weather center, and even a 'farm chat' area."
But the farming industry wasn't that into it. According to Sunbiz, the official Florida business registry, the company folded in less than a year.
2001: He gets into the beverage space with XStream
Farnsworth founded the company XStream Beverage Network Inc. in 2001, touting it as "an emerging developer, marketer and distributor of new age beverages."
He tried to buy a European energy drink called Dark Dog, but that deal never closed, according to Bloomberg.
By 2007, he was able to buy Global Beverage, which had in its stable Rudy Beverages, founded by famed 1970s Notre Dame football player Daniel "Rudy" Ruettiger.
In November of that year, Farnsworth resigned as chairman of XStream, and its stock dropped 99%, according to Bloomberg.
2007: Farnsworth becomes CEO of Purple Beverage
Farnsworth's failure with XStream didn't stop him from trying another venture in the drink space. He became the CEO of Purple Beverage Co., touting an antioxidant-rich drink.
The stock for Purple Bev went as high as $3.24 in April 2008, according to Bloomberg, thanks partly to Farnsworth landing celebrity spokespeople like Chaka Khan and New York Yankees Hall of Fame pitcher Mariano Rivera. But by the time he resigned a year later, the stock had plummeted by 99%.
2012: He oversees a vitamin company that flatlines within a year and is sued by FedEx
Farnsworth became the chairman of LTS Nutraceuticals Inc., a multilevel-marketing vitamin company. In 2011, it traded as high as $4.85. But by 2012, with Farnsworth running things, the stock fell 99%. It's unclear when he left the company because it didn't make periodic regulatory filings, according to Bloomberg.
In 2013, FedEx sued the vitamin company, saying it was owed $26,000. According to The Miami Herald, the judge ruled in FedEx's favor.
2016: Farnsworth’s Zone Technologies merges with HMNY to become publicly listed on the Nasdaq
Over a decade after Farmbid, Farnsworth went back into the tech space with an app called RedZone Maps (through a company called Zone Technologies). The app flagged where crimes were being reported in a user's area.
A year later, Zone Technologies merged with Helios and Matheson to become publicly listed on the Nasdaq. That same year, Farnsworth was named CEO of HMNY.
2017: HMNY acquires a majority stake in MoviePass
Since its birth in 2011, MoviePass had been trying to figure out a monthly subscription price that attracted moviegoers and would make a profit. By 2017, the company was on the brink of running out of money when Farnsworth got connected with MoviePass' then-CEO, Mitch Lowe. A deal was made for HMNY to take a majority stake in MoviePass. By that summer, Farnsworth and Lowe dropped the price to $10 a month, and the rest is history. With a huge rise in subscribers for MoviePass, the HMNY stock initially soared. But by 2020, MoviePass and HMNY went bankrupt.
At the time of bankruptcy, the company said it was under pending investigations by the Federal Trade Commission, SEC, four California district attorneys, and the New York attorney general.
In 2021, Farnsworth and Lowe settled with the FTC and reached a $400,000 settlement with the California district attorneys.
2021: Less than a year after MoviePass' bankruptcy, Farnsworth founds Zash Global Media and Entertainment
After MoviePass' bankruptcy, Farnsworth quickly landed back on his feet by starting a media company called Zash in less than a year. He later merged it with the publicly traded company Vinco Ventures. He acquired a TikTok rival called Lomotif and even tried (unsuccessfully) to buy the National Enquirer.
By the end of 2022, Vinco stock had cratered and is now worth less than one cent.
In 2024, Business Insider reported on Farnsworth's business tactics while at Zash. They mirror how he operated at MoviePass and some other ventures over the decades: Get involved with a publicly traded company, help raise funding from his finance connections at favorable terms for them, drive up the company's stock with splashy announcements, and leave retail investors with big losses when the stock crashes.
2022: Farnsworth is charged with securities fraud related to his time at MoviePass
In 2022, Farnsworth and Lowe were each charged with one count of securities fraud and three counts of wire fraud by the Department of Justice, which alleged the two "engaged in a scheme to defraud investors through materially false and misleading representations relating to HMNY and MoviePass's business and operations to artificially inflate the price of HMNY's stock and attract new investors."
Both have pleaded not guilty and are awaiting trial. If convicted, each face a maximum sentence of 20 years in prison on each count.
2024: Farnsworth is currently in jail
Farnsworth has been in a Florida jail since August 2023.
During Farnsworth's time out on bail, he traveled from his home in upstate New York to Miami on multiple occasions without notifying his probation officer and was involved in a domestic incident that resulted in a restraining order, which he also didn't report, according to Bloomberg.
His bail was revoked in an August 2023 hearing. He's now in jail awaiting his court date.
Read the original article on Business Insider
