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Second City acquired by New York private equity firm

The buyer is a firm run by private equity investor Strauss Zelnick, whose interests include the Grand Theft Auto game franchise.

The home of the Second City comedy club and school in Chicago’s Old Town, as seen last October.
The home of the Second City comedy club and school in Chicago’s Old Town neighborhood.
Pat Nabong/Sun-Times file

It’s no joke: Chicago’s Second City has been sold for only the second time in its 62-year history.

ZMC, a New York firm run by private equity investor Strauss Zelnick, said Thursday it has acquired the iconic comedy club and school, which has expanded into programs for corporations. Terms were not disclosed. The Financial Times has cited sources saying the deal could be worth $50 million.

“We are very excited to partner with management and the incredible talent at The Second City to grow the brand and build a diverse organization that elevates all voices,” said Jordan Turkewitz, co-chief investment officer and managing partner at ZMC. “Over its sixty-year history, The Second City has been home to some of the most beloved names in comedy, and we plan on building the next generation of comedy talent by investing in people and creativity.”

ZMC’s announcement noted that Second City has expanded beyond its club here to serve thousands of students and hundreds of businesses in the Fortune 1000. The business also operated in Hollywood and Toronto.

Steve Johnston, Second City’s president, said: “We are thrilled to work with ZMC as we continue to transform the company into an equitable and thriving environment while delivering world-class comedy to our audiences. I want to thank the talent, staff, alumni and audiences of The Second City for supporting us on our journey.”

Zelnick has invested in music and communications ventures. He’s also CEO of Take-Two Interactive Software, known for its Grand Theft Auto franchise of games.

Second City has had to drop its live shows because of the pandemic. The company also was rocked by allegations of racism in its ranks. The controversy led to the resignation last June of Andrew Alexander, a former co-owner of Second City. The majority owner was D’Arcy Stuart, son of former owner Len Stuart. With Alexander, Len Stuart bought the company in the 1980s from founders Bernie Sahlins, Paul Sills and Howard Alk.

Second City was founded in 1959. Its live shows have been a proving ground for alums such as John Belushi, Tina Fey, Bill Murray, Steve Carell, Julia Louis-Dreyfus, Stephen Colbert and Dan Aykroyd.

The sale is not expected to change the club’s Old Town location, where Alexander has said it has a long-term lease.