ABBA Voyage – Music Enterprise Analysis

ABBA Voyage – Music Enterprise Analysis

by | Oct 26, 2025 | Entertainment Law, Music Business, Podcast News


Whereas Hatsune Miku‘s voice was nonetheless generated by a vocal synthesiser, the voices of right now’s music avatars is produced by synthetic intelligence. One significantly profitable mission is “ABBA Voyage”. Utilizing refined know-how, avatars of the 4 ABBA members Agnetha Fältskog, Björn Ulvaeus, Benny Andersson and Anni-Frid Lyngstad had been delivered to life on stage in London, creating a brand new viewers attraction that shall be examined in additional element partially 3 of the collection on “Digital Music Worlds”.

Digital Music Worlds – Half 3: ABBA Voyage

The event and implementation of ABBA Voyage

An early instance of AI generated music avatars is arguably Sweden’s most profitable music export of all time: ABBA. After Agnetha Fältskog, Björn Ulvaeus, Benny Andersson and Anni-Frid Lyngstad made the far-reaching resolution in December 1982 to cease performing collectively, there have been repeated rumours of a reunion. Most just lately, these rumours had been fuelled by the large success of the primary “Mamma Mia!” film in 2008,[1] which was primarily based on the musical of the identical title that premiered in London’s West Finish in 1999.[2] ABBA mastermind Björn Ulvaeus even felt compelled to emphasize in an interview with the Sunday Telegraph: “We’ll by no means seem on stage once more. There may be merely no motivation to re-group. Cash isn’t an element and we want folks to recollect us as we had been – younger, exuberant, filled with power and ambition.”[3] Not even a suggestion of US$1 billion from an American-British monetary consortium for a joint tour, made to the pop group in 2000, may persuade the celebs to face on the live performance stage collectively once more.[4]

Though this perspective wouldn’t change later, there was no point out of a digital reunion on the time. Nevertheless, in an interview with Billboard journal on the finish of October 2016, Simon Fuller, the creator of the TV expertise present “American Idol” and CEO of 19 Leisure, introduced his plan to resurrect ABBA in digital actuality utilizing the most recent applied sciences and synthetic intelligence. He satisfied the 4 ABBA stars to take part and invited them to play an lively position: “We’re exploring a brand new technological world, with digital actuality and synthetic intelligence on the forefront, that can enable us to create new types of leisure and content material we couldn’t have beforehand imagined.”[5]

Step one on this course was to report a brand new album. Subsequently, ABBA reunited in a Stockholm sound studio in spring 2018, the place they recorded two new songs: ‘I Nonetheless Have Religion in You’ and ‘Don’t Shut Me Down’. Nevertheless, in an interview with the BBC, Björn Ulvaeus was quite obscure in regards to the digital ABBA mission. The one data he revealed was that work was underway on creating avatars, or ‘ABBA-tars’, that will tour instead of the human ABBA members.[6]

The mission gained momentum when British music video director Baillie Walsh joined the event workforce. In an in-depth interview for “Esquire”, he recounted how he was invited by the 2 govt producers, Svana Gisla and Ludvig Andersson, Benny Andersson’s son, to proceed growing the digital ABBA mission from 2019 onwards.[7] Initially, the concept was to convey ABBA onto the stage as holograms. Nevertheless, because the know-how was thought-about outdated and unsatisfactory, Walsh sat down with representatives from Industrial Gentle & Magic (ILM), the corporate based by Star Wars creator George Lucas, to discover the technical prospects of AI-generated ABBA avatars performing life-size on stage. The answer was a 10-metre-high LED wall, the place the inside lighting and stage lighting had been coordinated with the assistance of quite a few cameras to create the phantasm of a three-dimensional presence of the projected avatars.[8] Nevertheless, to attain this, the avatars first needed to be created utilizing movement seize know-how much like that used for Hatsune Miku. Within the winter of 2020, the 4 ABBA stars subsequently met at a specialist studio in Stockholm, the place they slipped into fits geared up with small spherical markers at particular factors on the physique. These fits had been used to seize the celebs’ actions from totally different angles utilizing 160 cameras.[9] It took 5 lengthy and intense weeks to report the dance sequences for every tune with ABBA’s 4 members and quite a few youthful physique doubles underneath the course of star choreographer Wayne McGregor utilizing movement seize.[10] The faces of Agnetha, Björn, Benny and Anni-Frid had been additionally captured intimately and rejuvenated utilizing AI. This ensured that the 4 ABBA members regarded convincingly actual on stage.[11]

The consequence was spectacular when, on 26 Could 2022, the premiere passed off on the ABBA Enviornment, which had been erected near Queen Elizabeth Olympic Park in London for 3,000 spectators, with distinguished visitors together with the Swedish royal couple. However it wasn’t simply the viewers who raved in regards to the convincingly practical avatar present,[12] which, with a finances of US$175 million, was the most costly stage manufacturing so far.[13]

Nevertheless, the investments have paid off. By 2022, 675,600 tickets had already been bought for “ABBA Voyage,” producing a income of GBP 97.1 million and a pre-tax revenue of practically GBP 3 million for Aniara Ltd., the corporate accountable for the digital present. In 2023, the variety of tickets bought rose to 1.1 million, leading to a turnover of GBP 103.7 million and a pre-tax revenue of GBP 6.1 million.[14] In December 2024, it was introduced that “ABBA Voyage” had bought 3 million tickets since its premiere and generated a gross worth added of GBP 775 million for the London economic system in its first two years.[15] Subsequently, it’s not shocking that these accountable sought a approach to make sure that “ABBA Voyage” would keep in London past April 2026, when the sector’s allow expires and it is because of make approach for a residential development mission.[16] The live performance corridor resembles a UFO and could be utterly dismantled and rebuilt elsewhere as a result of it was at all times meant for a global tour as a part of the “ABBA Voyage” mission.[17]

ABBA-tare as Position Fashions for Different Music Avatars: Avicii and KISS

Nevertheless, “ABBA Voyage” may quickly be increasing. Pophouse Leisure, the occasion and music rights firm co-founded by Björn Ulvaeus in 2014 and an investor in “ABBA Voyage”, has been shopping for up music catalogues from quite a few artists since 2022. For instance, in March 2022, Pophouse introduced that it had bought the grasp and publishing rights of the Swedish EDM group Swedish Home Mafia.[18] Nevertheless, Pophouse prompted a stir on the finish of September 2022 when it acquired 75 per cent of the grasp and publishing rights of the Swedish DJ Avicii, who died younger, from his heirs, the Bergling household.[19] It appeared probably that Avicii may very well be “resurrected” as a digital musician sooner or later. This assumption was confirmed in April 2024 when Pophouse acquired not solely the tune catalogue and related artist royalties of the glam rock band KISS, but additionally their NIL rights (title, picture, likeness), together with the rights to their distinctive face paint, for US $300 million. Per Sundin, now CEO of Pophouse and former head of Common Sweden, defined: “Our partnership will fuse the wealthy historical past and iconic standing of KISS with cutting-edge know-how, permitting followers – now and sooner or later – to expertise the band like by no means earlier than.”[20] This additionally contains the creation of avatars of the musicians modelled on the ABBA-tare, which may then go on tour as a digital band, as evidenced by an settlement that KISS concluded 4 months earlier than the rights take care of Pophouse.[21] KISS already has expertise with performances by their avatars. On the finish of their live performance at Madison Sq. Backyard in New York Metropolis, the enduring American band had their avatars carry out “God Gave Rock And Roll To You” as an encore, as evidenced by a promotional clip on YouTube.[22] We’re subsequently at first of a improvement whereby dwelling and deceased artists will take to the live performance stage within the type of AI-generated avatars. This may have vital financial implications. Avatars of superstars may carry out elsewhere on the similar time, relieving their human position fashions of the necessity to go on tour. This may additional focus the reside music market, which is already dominated by the famous person impact, making it tougher for youthful musicians to construct a profession. Moreover, music rights, significantly persona rights (NIL rights), will proceed to extend in worth as they’re

Endnotes

[1] Wikipedia, “Mamma Mia! (movie)”, model of August 22, 2025, accessed: 2025-08-22.

[2] Wikipedia, “Mamma Mia! (musical)”, model of August 24, 2025, accessed: 2025-08-22.

[3] Cited in The Guardian, “Abba reunion: Don’t maintain your breath”, July 7, 2008, accessed: 2025-08-26.

[4] Enterprise Insider, “Why ABBA Turned Down $1 Billion To Reunite In 2000”, July 9, 2014, accessed: 2025-08-26.

[5] Billboard, “‘Digital’ ABBA Coming Quickly By way of Partnership with Simon Fuller and Common Music”, October 26, 2016, accessed: 2025-08-26.

[6] BBC Information, “Abba announce first new music since 1982”, April 27, 2018, accessed: 2025-08-27.

[7] Esquire, “Tremendous Trouper”, July 21, 2022, accessed: 2025-08-27.

[8] An in depth description of the technical implementation of the digital ABBA mission could be discovered within the journal Ingenia, “How ABBA Voyage was made”, September 2022, accessed: 2025-08-27.

[9] Ibid.

[10] NME, “ABBA Voyage’s creators inform us how they made the present, and what’s subsequent”, Could 28, 2022, accessed: 2025-08-27.

[11] Ingenia, “How ABBA Voyage was made”, September 2022, accessed: 2025-08-27.

[12] The Guardian, “Abba Voyage assessment: jaw-dropping avatar act that’s destined to be copied”, Could 26, 2022, accessed: 2025-08-27.

[13] Musically, “Bloomberg breaks down numbers behind ABBA Voyage’s success”, September 5, 2023, accessed: 2025-08-27.

[14] Music Enterprise Worldwide, “ABBA Voyage generated $129m in 2023, as digital live performance collection attracts 1.1m guests”, October 1, 2024, accessed: 2025-08-27.

[15] ITV Information, “Abba Voyage to promote its 3,000,000th ticket this month after London present introduced £1.4bn economic system enhance”, December 9, 2024, accessed: 2025-08-27.

[16] Metro, “May Abba Voyage be leaving London for good?”, April 2, 2024, accessed: 2025-08-27.

[17] Ingenia, “How ABBA Voyage was made”, September 2022, accessed: 2025-08-27.

[18] Music Enterprise Worldwide, “Swedish Home Mafia promote grasp recordings and publishing catalogs to Pophouse”, March 29, 2022, accessed: 2025-08-27.

[19] Music Enterprise Worldwide, “Pophouse Leisure buys 75% of Avicii grasp recordings and publishing”, September 28, 2022, accessed: 2025-08-27.

[20] Music Enterprise Worldwide, “KISS sells tune catalog, title and IP to Pophouse, firm behind ABBA Voyage, in $300m deal”, April 4, 2024, accessed: 2025-08-27.

[21] Music Enterprise Worldwide, “KISS to stage avatar present in partnership with Pophouse Leisure, following the success of ABBA Voyage in London”, December 4, 2023, accessed: 2025-08-27.

[22] YouTube, “KISS – A New Period Begins”, December 3, 2023, accessed: 2025-08-27.

JKBX – the Sport Changer? – Music Enterprise Analysis

JKBX – the Sport Changer? – Music Enterprise Analysis

by | Oct 5, 2025 | Entertainment Law, Music Business, Podcast News


JKBX, pronounced like ‘jukebox’, might be a sport changer for the music funding markets. Fairly than providing low-yield music catalogues from second-tier artists, JKBX sells revenue participation rights to royalty streams from helpful catalogues, corresponding to that housing the songs of OneRepublic frontman Ryan Tedder. By doing this, JKBX hyperlinks the billion-dollar music rights market with the idea of fragmented music rights on funding marketplaces. Solely time will inform whether or not this idea will finally achieve the long run. On this a part of the weblog sequence, we study JKBX’s enterprise mannequin and company construction in additional element.

Music Funding Marketplaces – Half 4: JKBX – the Sport Changer?*

The Basis of JKBX

Jukebox Know-how LLC was based by the music trade veteran Scott Cohen in addition to Sam Hendel and John Chapman of UK-private fairness agency Dundee Companions in 2023 headquartered in Culver Metropolis/California. In September 2023, Jukebox Know-how launched the fractionalised music royalty platform http://www.jkbx.com on the Web.[1] Scott Cohen co-founded with Richard Gottehrer the digital music distributor The Orchard in New York Metropolis in 1997, which was acquired by Sony Music Leisure in two tranches in 2012 and 2015 for a complete of US $300 million.[2] In 2019, Cohen left The Orchard to develop into Chief Innovation Officer at Warner Music Group,[3] earlier than  becoming a member of Sam Hendel and John Chapman to kind Jukebox Know-how.

Dundee Companions collaborates with Chord Music Companions, owned by the PE firm Kohlberg Kravis Robert & Co. (KKR), to purchase the KMR Music Royalties II fund for US $1.1 billion[4] in addition to the music catalogue of the One Republic frontman and songwriter Ryan Tedder.[5] Dundee can also be a associate of the PE firm Francisco Companions and MUSIC, which bought the Swedish Kobalt Music Group for US $750 million.[6] Subsequently, Dundee Companions was concerned within the acquisition of three giant music catalogues.

The Construction and Functioning of JKBX

JKBX is just not the innovator of fractional music royalty marketplaces however is nonetheless a sport changer. In contrast to a lot of the music funding marketplaces that promote participation rights in artists royalty income streams, JKBX targets giant music rights house owners that need to monetize their catalogues.[7] Rightsholders can provide components of their music catalogues (publishing and grasp rights) as royalty shares on the JKBX platform. Subsequently, Jukebox Know-how based the Delaware registered firm Jukebox Hits Vol. 1 LLC on 3 April 2023, which secured US Securities and Alternate Fee (SEC) approval as a Regulation A providing[8] in March 2024.[9] The Providing Round describes Jukebox Hits Vol. 1 LLC as “(…) restricted legal responsibility firm established to facilitate and handle traders’ financial publicity to the Firm’s contractual proper to obtain a portion of the royalties, charges, and different revenue streams (“Earnings Pursuits”) associated to or derived from musical songs, compositions, sound recordings, portfolios or catalogs (“Music Belongings”).”[10] Subsequently, Jukebox Hits Vol. 1 enters into buy agreements with so-called revenue curiosity house owners, a synonym for music catalogue house owners. The music belongings are break up up into so-called Royalty Shares which are issued in sequence, associated to a selected music asset corresponding to a composition, a sound recording or a portfolio of songs. As Jukebox Hits Vol. 1 is a SEC registered firm, the music belongings are offered like shares. The patrons of the Royalty Shares are entitled to obtain a portion of the royalty income generated by the underlying licenses. Nevertheless, the Providing Round clarifies that the issued Royalty Shares “are unsecured restricted obligations”, which “don’t confer any voting rights on the holders thereof.”[11] This makes it clear that the acquisition of royalty shares doesn’t set up possession of the traders within the firm Jukebox Hits Vol. 1 nor within the underlying music belongings. Buyers in JKBX royalty shares solely purchase contractual rights to earned royalty streams. The contractual rights are bought as Royalty Shares on the web-based platform http://www.jkbx.com, which is owned by Jukebox Know-how LLC.[12] Whereas Jukebox Hits Vol 1 LLC is managed and administered by the Delaware registered firm Double Platinum Administration LLC.[13]

Determine 1: The JKBX conglomerate

Supply: After Jukebox Hits Vol. 1 LLC, “Providing Round”, March 1, 2024, p. 19.

At the moment the one catalogue proprietor that has entered a purchase order settlement with Jukebox Hits Vol. 1 LLC on 5 November 2023 is the Coda Songs LLC,[14] which is a 100 per cent affiliate of Inkling Capital LLC. The only proprietor of Inkling Capital, nevertheless, is John Chapman, who’s a co-founder of JKBX.[15] Subsequently all of the underlying publishing and grasp rights for the Royalty Shares are owned by a senior govt of JKBX. The data spotlight that Jukebox Hits Vol. 1 LLC paid US $43 million in money to Coda Songs LLC to accumulate the revenue pursuits within the music belongings.[16] The acquisition worth needs to be refunded by the sale of the Royalty Shares, that are supplied to so-called “certified purchasers”.[17]

The Financial Potential of JKBX

Determine 2: The highest 10 performing Royalty Shares by yield

Title Re-lease Date Rights sort Royalty sort Songwriterrecording artist producer 2023 royalty revenue Worth per share No. of shares Yield
All people Loves Me 2009 Sound recording producer Associated rights Digital Producer Ryan Tedder $685.16 $16.00 25 171.29%
If I Lose Myself 2013 Sound recording producer Associated rights Digital Producer Ryan Tedder $8,884.61 $1.84 50,000 9.66%
Wings 2013 Sound recording producer Associated rights Digital Royalty participant Producer Ryan Tedder $4,777.47 $31.00 2,000 7.71%
Ghost 2014 Compo-sition Songwriter Public perfor-mance SongwriterRyan Tedder $25,440.05 $3.34 100,000 7.62%
Wings 2013 Compo-sition Songwriter Public perfor-mance SongwriterRyan Tedder $17,921.20 $2.38 100,000 7.53%
Counting Stars 2013 Sound recording producer Associated rights Digital Producer Ryan Tedder $22,559.59 $3.23 100,000 6.98%
Welcome to New York 2014 Sound recording producer Associated rights Digital Royalty participant Producer Ryan Tedder $3,008.46 $45.00 1,000 6.68%
Good Life 2009 Sound recording producer Neighbouring Digital Producer Ryan Tedder $5,551.65 $1.55 60,000 5.97%
All of the Proper Strikes 2009 Sound recording producer Neighbouring Digital Producer Ryan Tedder $9,636.64 $1.65 100,000 5.84%
Counting Stars 2013 Compo-sition Songwriter Public perfor-mance Sync Mechanical Different SongwriterRyan Tedder $345,190 $31.37 200,000 5.50%

Supply: JKBX, “All Listings”, n.d., accessed: 2025-03-27.

Determine 3: The ten worst performing Royalty Shares by yield

Title Re-lease Date Rights sort Royalty sort Songwriterrecording artist producer 2023 royalty revenue Worth per share No. of shares Yield
Diploma-tico 2018 Sound Recording Grasp Gross sales
Sync Digital		 Label: Third Pardee Data $5,807.43 $3.47 100,000 1.67%
Make It Sizzling 2019 Sound Recording Grasp Gross sales
Sync Digital		 Label: Third Pardee Data $3,640.77 $2.35 100,000 1.55%
Brighter Than The Solar 2011 Sound Recording Producer Associated rights Digital Royalty participant Producer: Ryan Tedder $851.30 $55.00 1,000 1.55%
Each Breaking Wave 2014 Sound Recording Grasp Associated rights Digital Royalty participant Producer: Ryan Tedder $1,576.65 $1.80 60,000 1.46%
Blow That Smoke 2018 Sound Recording Grasp Gross sales
Sync Digital		 Label: Third Pardee Data $3,999.92 $2.79 100,000 1.43%
Track For Somebody 2014 Sound Recording Producer Associated rights Digital Royalty participant Producer: Ryan Tedder $2,284.66 $1.66 100,000 1.38%
Connec-tion 2018 Sound Recording Producer Associated rights Digital Producer: Ryan Tedder $1,215.65 $2.02 50,000 1.20%
Specific Style 2018 Compo-sition Songwriter Public perfor-mance Songwriter: Ryan Tedder $266.05 $24.00 1,000 1.11%
Specific Style 2018 Sound Recording Producer Associated rights Digital Royalty participant Producer: Ryan Tedder $0.78 $50.00 3 0.52%
Burn 2012 Sound Recording Producer Associated rights Digital Producer: Ryan Tedder $0.00 $10.00 100 0.00%

Supply: JKBX, “All Listings”, n.d., accessed: 2025-03-27.

The SEC Regulation A providing of Jukebox Hits Vol. 1 LLC stipulates that solely “accredited traders” can purchase Royalty Shares. These are pure individuals with an revenue of greater than US $200,000 in every of the 2 current years and so-called Excessive Web Price People (HNWIs) with a internet wealth increased than US $1 million.[18] Subsequently, solely comparatively rich traders can purchase JKBX Royalty Shares. Therefore, JKBX has the proper to evaluate and settle for but in addition reject a subscription to purchase Royalty Shares.[19] The JKBX music funding market, subsequently, solely permits restricted entry to its merchandise. The preliminary providing worth of the Royalty Shares are decided by Double Platinum Administration on an arbitrary foundation.[20] JKBX factors to the danger, that the precise worth of the funding, subsequently, could also be lower than what traders pay.[21] The Royalty Shares are offered on the www.jkbx.com platform on the Web to “certified traders” and the proceeds from the providing are used to fund the acquisition prices of the Royalty Rights and to pay overhead, worker prices, utilities and expertise prices, which incur by the administration firm.[22]

Though JKBX plans to launch a secondary market to commerce Royalty Shares, there isn’t any intention to commerce Royalty Shares on a inventory alternate. At the moment, nevertheless, no different buying and selling system is obtainable on the JKBX webpage.[23] It’s because Royalty Shares are unsecured restricted obligations of Jukebox Hits Vol. 1 LLC, whose commerce is related to a excessive danger.[24] Jukebox Hits Vol. 1 LLC has issued 97 Royalty Shares with completely different underlying composition and recording rights.

Regardless of its potential for innovation, JKBX is at the moment a gross sales platform for contractual rights to earned royalty streams and restricted to rich traders. It’s neither a buying and selling platform for music rights nor a inventory alternate for music shares. Moreover, JKBX solely has a single music catalogue, acquired from Coda Songs for round US $43 million. This funding should first be recouped by the sale of Royalty Shares. It stays to be seen whether or not additional music catalogues shall be obtainable for the sale of Royalty Shares sooner or later.

Endnotes

[1] Billboard, “Wish to Make investments In Your Favourite Track? JKBX Bets Followers Will Deliver Billions to Market”, August 25, 2023, accessed: 2025-03-25.

[2] Billboard, “Sony’s Orchard Acquisition, By the Numbers and Behind the Scenes”, March 19, 2015, accessed: 2025-03-25.

[3] Music Enterprise Worldwide, “Official: Warner hires Scott Cohen, co-founder of The Orchard, as Chief Innovation Officer, Recorded Music”, March 6, 2019, accessed: 2025-03-25.

[4] Music Enterprise Worldwide, “Confirmed: Kobalt sells catalog to new KKR enterprise, Chord, for $1.1 billion”, October 19, 2021, accessed 2025-01-15.

[5] Music Enterprise Worldwide, “KKR buys majority stake in Ryan Tedder catalog, marking funding large’s return to music rights possession“, January 11, 2021, accessed: 2024-12-11.

[6] Music Enterprise Worldwide, “Kobalt Music Group offered to US-based personal fairness agency Francisco Companions”, September 7, 2022, accessed: 2024-12-11.

[7] In September 2023, JKBX additionally launched its Creator Program for artists, who need to promote a share of their royalty income streams; see: Music Enterprise Worldwide, “JKBX, launching this week, confirms it should pay songwriters and artists direct by way of ‘Creator Program’ – even when they don’t personal their rights”, September 11, 2023, accessed: 2025-03-25.

[8] A Regulation A providing is a sort of mini Preliminary Public Providing (IPO), which permits to supply and promote securities to the general public by way of a course of that’s much like, however much less in depth than, a registered providing; see: US Securities and Alternate Fee (SEC), “Regulation A”, November 14, 2024, accessed: 2025-03-25.

[9] Music Enterprise Worldwide, “Music royalties buying and selling platform JKBX launches – with regulatory approval from the SEC”, March 6, 2024, accessed: 2025-03-25.

[10] Jukebox Hits Vol. 1 LLC, “Providing Round”, March 1, 2024, p. 1.

[11] Ibid.

[12] Ibid., p. 2.

[13] Ibid., p. 1.

[14] Ibid., p. 16.

[15] Ibid., p. 45.

[16] Ibid., p. 61.

[17] Ibid., p. 13.

[18] Ibid., p. 49.

[19] Ibid.

[20] Ibid., p. 25.

[21] Ibid., p. 34.

[22] Ibid., p. 14.

[23] Ibid., p. 2.

[24] Ibid., p. 34.

This weblog submit relies on the report IP Finance within the Music Business, which was commissioned by the World Mental Property Rights Group (WIPO).

The Financial Potential of MIMs – Music Enterprise Analysis

The Financial Potential of MIMs – Music Enterprise Analysis

by | Sep 14, 2025 | Entertainment Law, Music Business, Podcast News


Within the earlier 4 components (half 1, half 2, half 3 and half 4) of the sequence on music funding marketplaces, we analysed many alternative enterprise fashions, together with people who have failed. On this fifth and last a part of the weblog sequence, we’ll summarise the findings from components 1-4 and assess the financial potential of the person fashions. Particularly, we’ll consult with the completely different copyright frameworks in america in comparison with different nations, particularly in Europe, to reply the query of what’s wanted to create a well-functioning and clear music funding market.

Music Funding Marketplaces – Half 5: The Financial Potential of MIMs

Completely different Enterprise Fashions of MIMs

Music funding marketplaces purpose to monetise music rights for buyers and create a market for them. Nonetheless, evaluation of music funding marketplaces exhibits that there are at the moment many alternative fashions vying for the favour of buyers. Usually, MIMs goal small buyers and music followers who should purchase shares in music rights for a number of {Dollars} or Euros. There are additionally choices corresponding to Royalty Alternate, sliceNote and JKBX, that are aimed extra at rich buyers or excessive web price people who can afford to speculate bigger quantities per share. Generally, nonetheless, buyers can’t purchase music rights instantly, however solely participation rights in royalty streams. Resulting from copyright legal guidelines in a lot of the European nations, it isn’t potential to buy music rights. Rights can solely be licensed to be used. Because of this, European marketplaces solely supply oblique methods for consumers to generate income from music rights. Completely different methods are used. The Austrian MIM World Rockstar presents “alternatives” through a crowdfunding platform to small buyers who can purchase participation rights within the income streams of artists. As World Rockstar additionally operates a label and a music publishing firm, artists can both license their rights on to World Rockstar or supply them on the market instantly on the platform within the type of participation rights. In each instances, buyers don’t obtain any rights to the underlying publishing and grasp rights.

Different platforms additionally supply rights to royalty streams, marketed beneath names corresponding to “SongShares” from the French firm Bolero or “Preliminary Music Choices” (IMOs) from the Swedish MasterExchange. The US-based JKBX additionally doesn’t promote shares in music rights or songs instantly, however participatory rights within the type of “Royalty Shares”. Solely the US platforms slice Be aware and Royalty Alternate supply shares in music rights for direct buy, primarily to rich buyers keen to pay US $10,000 per share.

Shares are offered both at costs set upfront by the platforms or the rights house owners, or via auctions, as within the case of SongVest, Musicow and ANote Music. Musicow and ANote Music enable bought shares to be resold on secondary buying and selling platforms after the preliminary buy, though the administration charge per transaction is often larger on the secondary market. The European MIMs Tangy Market and Bolero observe an analogous mannequin, however and not using a prior public sale. Resale platforms are additionally deliberate for World Rockstar and JKBX. Nonetheless, JKBX explicitly states that the Royalty Shares can solely be traded on the corporate’s personal secondary gross sales platform and never on an exterior inventory trade.

Some platforms try to unravel the repurchase of music rights shares via tokenisation, promoting the participation rights within the type of non-fungible tokens (NFTs) on the blockchain. Swedish platforms MasterExchange and Anotherblock and Turkish platform Parça promote music rights NFTs on the Ethereum and Polygon blockchains respectively. The Austrian platform World Rockstar additionally permits the acquisition of NFTs along with the traditional analogue sale of “alternatives”.

The Situations for a Functioning Music Funding Market

The completely different fashions present that it’s tough to make music rights a tradable commodity that may be purchased and offered by small buyers. Particularly outdoors the US, copyright legal guidelines make it tough to make music rights tradable as monetary merchandise. As well as, many artists don’t management their publishing and mastering rights and may solely “promote” their earnings streams from accumulating societies within the type of participation rights. It’s simpler for music publishers and labels to monetise their music catalogues on MIMs, as the instance of JKBX exhibits.

The US subsequently has a bonus over the EU due to its copyright framework. It’s not solely the likelihood to promote copyright and associated rights that makes the US a thriving music rights market, but in addition the opportunity of reversion rights, that are primarily utilized by superstars to regain management over their music catalogues. Nonetheless, the excessive fragmentation of rights within the EU can be an impediment to the event of a well-functioning music rights market. If, as within the US, it’s potential to amass not solely the publishing and grasp rights of an artist, but in addition the NIL (identify, picture and likeness) rights, then this bundle of rights has a better financial worth. Then again, transaction prices improve when completely different rights are distributed amongst completely different actors. If, furthermore, music rights can’t be offered however solely licensed to be used, as is the case within the EU, then, because the music funding marketplaces present, difficult workarounds corresponding to rights to royalty streams have for use. Finally, nonetheless, it’s a political determination whether or not the authorized framework ought to encourage the creation of music markets on the expense of the authorized safety of creators.

For music funding marketplaces to work effectively, they want additionally helpful music catalogues that generate a daily income stream. That’s why MIMs work higher in markets the place such music catalogues are extra available – such because the US, South Korea (because of Okay-Pop) and Sweden (because of many internationally profitable songwriters) – than in markets the place these situations aren’t met. The failure of Estonia’s Fanvestory is an efficient instance of how a supplier wants the backing of a robust market to function its enterprise mannequin in a sustainable means. This enterprise mannequin is based on taking administration charges, which vary from 1 to eight per cent per transaction for the varied suppliers. Nonetheless, it is sensible to have a second monetary mainstay, corresponding to World Rockstar, which can be a music writer and label. One other necessary success issue is that the MIMs have adequate liquidity, i.e. investor capital. An absence of liquidity has proved deadly for Fanvestory, Vezt and Royal.io, which have already ceased buying and selling attributable to a scarcity of investor capital.

That is additionally attributable to the truth that returns don’t at all times meet expectations. An evaluation of the returns on Royalty Alternate and JKBX exhibits that the values are extremely depending on {the catalogue} and the efficiency of particular person songs, which can be extremely risky over time. As well as, most platforms supply comparatively few funding alternatives, often effectively beneath 100. Solely Royalty Alternate and Musicow have greater than thousand funding alternatives on their webpages. World Rockstar, Tangy Market, SongVest, Bolero and JKBX are in the course of the vary with not less than 100 alternatives.

Mainly, it’s a dangerous funding that’s not advisable for small buyers with out prior information of how the music rights enterprise works. Because of this, South Korea’s Monetary Companies Fee took motion to research Musicow’s enterprise mannequin extra intently and solely gave the corporate the inexperienced mild to proceed working after the Korean platform improved investor safety.

Then again, music funding marketplaces enable artists to monetise their music rights and followers to speculate, not less than not directly, of their favorite music. Both means, there may be potential for the creation of an progressive market for music rights, though there must be regulatory safety for each the rights holders who supply their royalty shares on the market and the small-scale buyers who purchase monetary merchandise backed by music rights.

The Second Wave of MIM Begin-ups, since 2021 – Music Enterprise Analysis

The Second Wave of MIM Begin-ups, since 2021 – Music Enterprise Analysis

by | Aug 24, 2025 | Entertainment Law, Music Business, Podcast News


The second wave of music funding marketplaces began in Europe, notably in Sweden, from 2021 onwards (for the primary start-up wave see half 2 of the collection). With Tangy Market, Grasp Trade and Anotherblock three new gamers entered the Swedish market between 2021 and 2023. The wave of latest firms continued with Bolero (2021) in France, Sonomo (2023) within the Netherlands, OG Music (2023) in Italy and Parca (2023) in Istanbul, Turkey. Within the US, three new music funding marketplaces have been launched in the identical interval: Band Royalty in 2021 and sliceNote in addition to JKBX in 2023. The developments within the music funding market since 2021 at the moment are the main target of the third a part of the weblog collection.

Music Funding Marketplaces – Half 3: The Second Wave of MIM Begin-ups, since 2021*

MIMs from Sweden: Tangy Market, MasterExchange, Anotherblock

Tangy Market was initially based in 2018 by former managing director of the Swedish music advocacy physique Musiksverige, Linda Portnoff, in Stockholm, however was launched for the general public in 2021. Within the meantime, Tangy Market in partnership with the Swedish accumulating society STIM to course of royalty funds, developed the cell app for the buying-and-selling-platform and purchased preliminary music property.[1] Tangy Market is a typical fractional royalty platform. Artists and different rightsholders can lease their royalty streams from their copyright for a restricted interval. Nonetheless, the rightsholders hold 100 per cent of the copyrights, as a result of they solely promote participation rights of their royalty revenues.[2] Tangy Market targets small traders and music followers, who can obtain the cell app, create a private account and deposit cash for funding. Buyers can then purchase and promote royalty shares of their favorite artists and take part within the royalty payouts. Apart from native Swedish music catalogues, Tangy Market additionally gives songs lined by celebrity artists resembling “Totally different Form of Love Tune” by Cher, “She Don’t Just like the Lights” by Justin Bieber and “Work B**ch!” by Britney Spears.[3]

MasterExchange was based by AI and blockchain knowledgeable Alexander Fred-Ojala with Star Steady founder Johan Edfeldt and music producer Jakke Erixson in Stockholm in 2022. MasterExchange is a music funding platform to purchase and promote shares in music royalty income streams. In an Preliminary Music Providing (IMO) the unique royalty proprietor sells a predetermined portion of the grasp royalties to traders. A royalty share is the distinctive tradable asset on the MasterExchange platform, representing a stake in a tune’s future grasp royalties. Like different fractional royalty platform, the traders don’t management the underlying copyright however personal a participation proper within the royalty income stream. In contrast to ANote Music or Tangy Market, the MasterExchange’s royalty share is related to an NFT on the Polygon blockchain. Nonetheless, MasterExchange conducts transactions in Euros reasonably than in cryptocurrency.[4] In August 2023, MasterExchange raised US $2.7 million in funding from a number of traders together with Vectr Fintech and launched the primary preliminary music providing of the tune “Sofia” by Alvaro Soler, launched in July 2016, which has generated over 2 billion music streams throughout numerous platforms, particularly in Italy and in Spain.[5]

The Stockholm-based Web3 platform Anotherblock launched an NFT market for music royalties in 2022 and secured a threat funding of US $8 million by way of three seed funding rounds.[6] Music rightsholders can supply shares of their royalty income streams on Anotherblock’s platform.[7] One instance was the Swedish songwriter and producer Alex Karlsson, who wrote songs for Ok-Pop acts resembling BTS, NCT, TXT and Twice, and provided the BTS hit “We Are Bulletproof: The Everlasting” on Anotherblock’s web site. Buyers should buy a 0.004 per cent share of a royalty NFT for 0.023 Ether, which truly equates to US $63.[8] The royalty NFTs are tradeable and will be bought on the secondary market on the Anotherblock platform.

Paris, Amsterdam, Milan and Istanbul: Bolero, Sonomo, OG Music, Parça

Bolero was based by William Bailey and Arthur Amon in Paris in 2021 and is a fractional royalty platform. The enterprise mannequin is similar to that of ANote Music. Buyers should buy and promote so-called “Tune Shares” in single songs or tune catalogues. A Tune Share is a digital asset that entitles to get a share of the correct to obtain proportional royalties from publishing and grasp rights of a particular tune or tune catalogue. Rights holders can switch their revenue streams from the accumulating societies to Bolero for a predefined interval however retain the underlying rights. Subsequently, the traders don’t management the underlying copyright however purchase a participation proper within the income stream generated by licensing of the tune/tune catalogue to music customers resembling music streaming companies, radio and TV stations. Bolero additionally gives a secondary market platform, the place the traders can commerce their acquired Tune Shares.[9]

Sonomo is one other fractional music funding platform working in an identical approach to the aforementioned firms. Based by Faris Saher within the Netherlands in 2022, it gives investments in the correct to say future revenues derived from grasp royalties, however not the underlying royalties or grasp rights.[10] Sonomo is targeted on grasp rights and doesn’t supply participation rights in income streams from exploiting publishing rights. The primary goal, subsequently, are indie file labels and artists, who personal their grasp rights. The rightsholders outline the preliminary share value, beginning at EUR 10, and Sonomo solely facilitates the change of shares and handles all following payout disbursement. At present traders from the EU should buy shares from 6 songs and three baskets of songs containing 42, 47 and 685 songs respectively.[11]

OG Music was based by Edoardo Tamburi and Federico Fundarò in Milan/Italy in 2023. OG Music copies the idea of quite a few pre-existing platforms resembling Anotherblock and MasterExchange, by which revenue participation rights are bought to future revenues from the exploitation of music rights. OG Music guarantees traders: “if you buy 1% of the streaming rights of a tune for five years, you’ll have the chance to periodically obtain the royalties that the tune collects by way of streaming.” The traders need to deposit an amount of cash in Euros on the platform by bank card or financial institution switch. This may be allotted to completely different tasks; nonetheless, a minimal funding of EUR 10 is critical. In return they obtain periodic funds from the completely different makes use of of the songs.[12]

Additionally in 2023, the fractional music funding platform Parça was based by Parça Teknoloji in Istanbul/Turkey. The enterprise idea is just like that of many music funding marketplaces already described. Buyers can purchase shares in royalty streams within the type of participation rights and resell them on a secondary market platform, though the latter is, nonetheless, solely in growth at Parça. For every profitable transaction, Parça costs a 5 per cent fee payment, no matter whether or not it’s an preliminary sale or a sale on the secondary buying and selling platform. Parça is the place traders can put their cash, primarily for Turkish repertoire. There are at present 69 songs on the market on the homepage, with lots of them by the identical artists.[13]

Again within the USA: Band Royalty and sliceNote

Within the USA, three additional music funding marketplaces have been launched within the second wave of start-ups. In 2021, the music trade veterans Barnaby Andersun and Noble Drakoln established Band Royalty, which has acquired music rights of 57 songs carried out by platinum-selling artists resembling Justin Timberlake, Jay-Z, Rihanna, Beyonce, Cher and so forth.[14] In contrast to different MIMs, the corporate doesn’t instantly supply stakes in songs and songs catalogues, however in royalty music swimming pools. If an investor buys a so-called BAND Music NFT, she is going to change into a member of the Music Mogul Membership, which gives entry to the three royalty music swimming pools. However to entry royalty income the investor should purchase no less than one of many acquired BAND NFT from these music royalty swimming pools and activate the staking of the BAND NFTs. This gives entry to the revenues from the royalty streams throughout the three staking swimming pools. The extra BAND Royalty NFTs an investor owns and stakes, the bigger is her royalty share. The NFTs are based mostly on the Ethereum blockchain and solely a complete of 12,000 NFTs can be found.[15]

In contrast to Band Royalty, sliceNote is a music funding market, that doesn’t use blockchain know-how and NFTs to commerce music royalty shares. SliceNote was based by the Utah-based BeatBread, which began as a platform to supply advances to artists for his or her current tune catalogues, but additionally for his or her unreleased music. In return, BeatBread receives a share within the artists’ royalty funds, over a interval decided by the artist. BeatBread was based in 2020 by Peter Sinclair and was in a position to elevate US $34 million in a primary funding spherical in February 2022 and closed one other US $100 million fund with Variant Investments in November 2022. In April 2023, BeatBread launched the music funding platform sliceNote, which gives certified traders (excessive web value people, file labels, music publishers and so forth.) the likelihood to put money into fractional shares as small as 1 per cent per deal.[16] Thus, sliceNote just isn’t a typical fractional royalty platform resembling SongVest and Musicow, however a music rights gross sales platform extra corresponding to Royalty Trade.

Determine 1: Listing of music funding marketplaces

Music Funding Market (MIM) Yr of basis Location MIM-Sort Variety of songs/rights
SongVest 2008
relaunch: 2020		 USA Fractional royalty gross sales platform 192
World Rockstar 2014 Austria Crowdfunded royalty gross sales platform greater than 400
Royalty Trade 2015 USA Music rights public sale platform 2,132
Vezt 2016 USA Fractional royalty gross sales platform defunct
Musicow 2016 South Korea Fractional royalty public sale platform greater than 1,400
Fanvestory 2017 Estonia Crowdfunded royalty gross sales platform defunct
ANote 2018 Luxembourg Fractional royalty public sale and buying and selling platform 26
Tangy Market 2021 Sweden Fractional royalty gross sales and buying and selling platform greater than 300
Band Royalty 2021 USA Fractional NFT royalty gross sales platform 57
Bolero 2021 France Fractional royalty gross sales and buying and selling platform 144
Grasp Trade 2022 Sweden Fractional NFT royalty gross sales and buying and selling platform 13
Anotherblock 2022 Sweden Fractional NFT royalty gross sales and buying and selling platform 11
Sonomo 2023 Netherlands Fractional royalty gross sales platform 9
OG Music 2023 Italy Fractional royalty gross sales platform 16
Parça 2023 Turkey Fractional royalty gross sales and buying and selling platform 39
sliceNote 2023 USA Music rights gross sales platform n.a.
JKBX 2023 USA Fractional royalty gross sales platform 97

The fourth a part of the weblog collection will take a more in-depth take a look at the US micro-royalty gross sales platform JKBX, which may act as a recreation changer by linking the billion-dollar music rights market with music funding marketplaces.

Endnotes

[1] Tangy Market, “About Us”, n.d., accessed: 2025-03-19.

[2] Tangy Market, “For Creators”, n.d., accessed: 2025-03-19.

[3] Tangy Market, “Funding Calculator”, n.d., accessed: 2025-03-19.

[4] MasterExchange, “How It Works”, n.d., accessed: 2025-03-19.

[5] Music Enterprise Worldwide, “After elevating $2.7m, music royalties market MasterExchange sells out its first ‘preliminary music providing’”, August 17, 2023, accessed: 2025-03-19.

[6] Music Enterprise Worldwide, “Web3 music startup anotherblock raises $4.3m in newest funding spherical”, Could 17, 2023, accessed: 2025-03-19.

[7] Anotherblock, “The trusted bridge to music rights investments”, n.d., accessed: 2025-03-19.

[8] Anotherblock, “‘We Are Bulletproof: The Everlasting’ by Alex Karlsson”, n.d., accessed: 2025-03-19.

[9] Bolero, “Incessantly Requested Questions”, n.d., accessed: 2025-03-19.

[10] Fintech Finance Information, “Sonomo Hits the Proper Notice With Weavr’s Help”, November 22, 2022, accessed: 2025-03-24.

[11] Sonomo, “How It Works”, n.d., accessed: 2025-03-24.

[12] OG Music, “FAQ”, n.d., accessed: 2025-03-24.

[13] Parça, “How It Works”, n.d., accessed: 2025-03-24.

[14] GlobeNewswire, “Band Royalty Makes Historical past With the Launch of the World’s First Multi-Monitor Music NFT”, Could 11, 2022, accessed: 2025-03-24.

[15] Band Royalty, “FAQs”, n.d., accessed: 2025-03-24.

[16] Music Enterprise Worldwide, “BeatBread brings fractional investing to the unbiased artist funding scene”, April 12, 2023, accessed: 2025-03-24.

* This weblog publish is predicated on the report IP Finance within the Music Trade, which was commissioned by the World Mental Property Rights Group (WIPO).

The Securization of Music Rights – Music Enterprise Analysis

The Securization of Music Rights – Music Enterprise Analysis

by | Aug 3, 2025 | Entertainment Law, Music Business, Podcast News


Non-public fairness initiatives, wherein music catalogues are purchased up for hundreds of thousands, might simply be a transitional section in the direction of a brand new growth wherein music turns into a speculative commodity. The buzzword is securitisation. Which means that monetary giants are creating new monetary merchandise primarily based on music rights and the revenue streams they generate. In enterprise jargon, these are known as asset-backed securities (ABS), which gained their doubtful fame throughout the monetary and financial disaster that started in 2008. Nevertheless, on this case, it’s music rights somewhat than actual property loans which can be being securitised. This fifth and last a part of the weblog collection takes a more in-depth have a look at how this works and the benefits and downsides of this growth.

Comply with the Cash! Huge Capital within the Music Rights Market – Half 5: The Securization of Music Rights*

The Revival of the “Bowie Bonds”

In December 2021, Northleaf Capital Companions issued US $303.8 million in asset-backed securities (ABS) for buyers to subscribe to. These securities had been backed by a combination of music publishing and grasp rights to 52,729 music titles from the Spirit Music Group catalogue, together with the publishing rights to songs by Pete Townshend of The Who and the masters catalogue of nation star Tim McGraw, [1] each of which had been acquired by Spirit Music Group earlier than Northleaf’s funding in 2020. [2] This elevated the funding in music rights to a brand new degree, because it turned music right into a commodity that may be traded alongside different securities. This idea is paying homage to the ‘Bowie Bonds’, which British celebrity David Bowie launched on the U.S. market in 1997. These bonds bundled the rights to Bowie’s songs and assured buyers a set annual rate of interest of seven.9 per cent for ten years. Though buyers had been repaid their capital plus curiosity on the finish of the bond’s time period, the report business’s recession, starting round 2000, led ranking businesses to downgrade the Bowie Bonds from an preliminary triple-A ranking to Baa3, simply above junk degree.[3] The worldwide monetary disaster that adopted ultimately put an finish to this and related ventures.

A New Increase of Music Rights Securization

A long time later, Bowie’s avant-garde monetary experiment will be seen in a brand new mild because the time appears ripe for brand new monetary merchandise that package deal music rights for buyers. After Northleaf, KKR in February 2022 introduced the securitization of an unlimited music rights portfolio, acquired by its Chord Music three way partnership with Dundee Companions. KKR Credit score Advisors meant to promote greater than US $732 million of ABS supported by publishing and sound recording royalties from a list of 65,000 songs, together with hits from The Weeknd, Infantile Gambino, and Stevie Nicks.[4]

Nevertheless, a forerunner of this securitization increase was the US music accumulating society SESAC, which was purchased by Blackstone in 2017. In August 2019, SESAC bought US $560 million in bonds backed by licensing agreements and music royalty streams. In comparison with the later ABS offers, SESAC bought basic company bonds providing a yield of 5.25 per cent for a weighted common lifetime of 6.7 years. Kroll Bond Ranking assigned these bonds a ranking of BBB minus.[5] Three years later, in July 2022, SESAC once more issued company bonds price US $335 million to finance the acquisition of Audio Community, acquired by SESAC in 2021.[6] These bonds act like loans, however from a bunch of buyers as a substitute of elevating cash from a financial institution. The buyers anticipate the payback of their investments plus curiosity after an outlined interval, when the underlying asset has earned the required revenue.

These music rights ABS transactions, nonetheless, created new monetary merchandise, tradeable in a specialised market. This was the intention of Blackstone’s Hipgnosis Songs Capital fund, when it introduced the launch of a US $221.65 million securitization of 950 songs of its music catalogue, together with hit songs by Leonard Cohen, Justin Timberlake, and Nelly Furtado.[7]

Determine 1: The method of securitization of music rights catalogues, 2019-2025

Date of transaction Firm Sort of securitization Catalogue Transaction worth (in US$ m)
Aug 2019 Blackstone Group Company bonds SESAC licensing catalogue 560
Dec 2021 Northleaf Capital Companions ABS 52,729 music titles from the Spirit Music Group catalogue 303.8
Feb 2022 KKR ABS 65,000 songs acquired by Chord Music 732
Jul 2022 Blackstone Group Company bonds SESAC licensing catalogue 335
Aug 2022 Blackstone Group ABS 950 songs from the Hipgnosis Songs Capital fund 221.7
Dec 2022 Apollo Asset Administration ABS Greater than 1 million songs from the Harmony catalogue 1,800
Feb 2024 ATLAS SP Companions and Truist Securities ABS 5,000 songs from the Kobalt Music Publishing catalogue 266.5
Mar 2024 KKR ABS HarbourView music rights catalogue 500
Nov 2024 Blackstone Group ABS 45,000 songs catalogue from the Hipgnosis Songs Fund 1,470
Complete       6,189

In December 2022, Apollo Asset Administration’s Capital Resolution issued asset-backed securities price US $1.8 billion in cooperation with JP Morgan. Apollo’s ABS are backed by greater than 1 million copyrights from Harmony’s music catalogues, together with songs from Phil Collins, Creedence Clearwater Revival, Daft Punk, Miles Davis, Genesis, Think about Dragons, James Taylor, 9 Inch Nails, Pink Floyd, Cyndi Lauper, Little Richard, Otis Redding, R.E.M. and lots of different superstars.[8] In February 2024, it was introduced that ATLAS SP Companions, along with Truist Securities, had provided to promote US $266.5 million price of music ABS primarily based on roughly 5,000 songs from 66 songwriters from the Kobalt Music Publishing  catalogue.[9] A month later HarbourView efficiently satisfied the personal fairness agency KKR to challenge US $500 million in ABS backed by the royalty revenue from the exploitation of the acquired rights catalogue.[10] In November 2024, Blackstone accomplished a US $1.47 billion music rights ABS transaction, backed by the Hipgnosis Songs Fund 45,000-song portfolio, which Blackstone had acquired in July 2024 for US $1.58 billion. The proceeds from the so-called Lyra 24-2 ABS deal had been used primarily to repay debt and to finance future music catalogue acquisitions.[11]

A complete of US $6.2 billion of music-related bonds and asset-backed securities (ABS) has been issued since 2019 primarily by the big PE corporations, Apollo, Blackstone, KKR, and Northleaf. The securitization of music catalogues is each a monetization of music rights but additionally an exit technique for PE initiatives.

How the Securization Enterprise Works: Benefits & Disadvantages

In 2022, the pre-sale report for Hipgnosis Music Belongings (MUSIC 2022-1) by Kroll Bond Ranking Company (KBRA) highlighted how the ABS enterprise works. The MUSIC 2022-1 ABS had been issued by Hipgnosis Music Belongings 2022-1 L.P. with a price of US $221.65 million, collateralized by the royalty streams from the music publishing and grasp rights catalogue comprising 950 songs from charting songwriters and artists, together with Justin Timberlake, Nelly Furdato, and Leonard Cohen. This music catalogue was administered by the three music majors Common, Sony and Warner in addition to seven different music rights directors. The 950 songs catalogue was valued at US $341 million with a reduction fee of seven per cent. The bonds bear curiosity semi-annually and no repayments are scheduled earlier than the anticipated compensation date in Could 2027. The ranking company instructed a ranking of A- for the MUSIC 2022-1 bonds, suggesting a low danger profile.[12]

The pre-sales report additionally included an evaluation of the royalty construction of the music catalogue. Virtually two thirds of the entire annual income of US $13.4 million (earlier 12 months to Q1 2022) had been derived from licensing of publishing rights with one third from sound recording rights. Nevertheless, the income figures present that only some songs are worthwhile. For instance, ‘Hallelujah’, written by Leonard Cohen and carried out by himself and 9 different acts, generated by far the very best annual revenues accounting for 12.8 per cent or US $1.71 million.[13] General, the highest 10 songs accounted for nearly 40 per cent of all royalties. This extraordinarily uneven distribution of royalties can be seen among the many artists. The highest 10 artists within the catalogue account for 78 per cent of the entire revenue. An evaluation by age of songs revealed that outdated repertoire, outlined as songs launched 30 years in the past or extra, generated income of US $4.6 million per yr, or 35 per cent of complete income. An additional 34 per cent of gross sales had been generated by songs 10 to twenty years outdated, and an additional 8 per cent got here from songs that had been between 20 and 30 years outdated. General, songs that had been greater than 10 years outdated generated gross sales of US $10.2 million, which corresponds to a 77 per cent share of gross sales. Conversely, this meant that solely 23 per cent of annual catalogue income got here from repertoire lower than 10 years outdated.[14]

Nevertheless, in comparison with different ABS transactions, the focus of income from the highest 10 songs within the Hipgnosis MUSIC 2022-1 ABS is the very best at virtually 40 per cent. By comparability, the highest 10 songs from the 65,000-song Chord Music catalogue, on which the KKR ABS is predicated, generated 10.7 per cent of annual revenues, whereas the highest 10 songs from the 52,729-song Spirit Music catalogue, on which the Northleaf ABS is predicated, generated 15.9 per cent of complete annual revenues. This robust focus of revenue within the Hipgnosis ABS most likely led to the A- ranking by the KBRA, whereas the KKR and Northleaf ABS had been every rated A.[15]

The KBRA report highlights each, the benefits of the securitization of music rights catalogues in addition to the disadvantages. ABS transactions allow the monetisation of music catalogues, which thereby enhance in worth. Securitisation additionally creates new monetary merchandise that may be traded on a market which supplies music rights an financial worth that’s decided by provide and demand.

The KBRA report additionally reveals one other downside that the worth of the brand new monetary merchandise depends upon a couple of fashionable songs. Ought to these songs, for no matter motive, lose their reputation, the worth of the related music bonds will undergo. If, as well as, different leisure rights or different claims to future revenue (e.g. authorized proceedings received) are bundled with the music rights within the ABS, non-transparent monetary merchandise might come up that solely serve hypothesis. On this case, losses in different areas might even have a unfavorable impression on the worth of the music rights.

All elements of the collection “Comply with the Cash! Huge Capital within the Music Rights Market”

Half 1: A Quick Historical past

Half 2: The Funding Giants

Half 3: Shamrock Capital Advisors

Half 4: The Enterprise Mannequin of Non-public Fairness Corporations

Half 5: The Securization of Music Rights

Endnotes

[1] Music Enterprise Worldwide, “‘Bowie bonds’ are again: Northleaf makes use of Spirit Music Group belongings to lift $303.8m providing”, December 20, 2021, accessed: 2025-02-14.

[2] Music Enterprise Worldwide, “Spirit Music Group acquires grasp recordings of Tim McGraw initially launched by Huge Machine”, September 9, 2020, accessed: 2025-02-14.

[3] Music Enterprise Worldwide, “The title’s bonds. Music bonds.”, October 19, 2021, accessed: 2025-02-14.

[4] Music Enterprise Worldwide, “KKR purchased a music catalog from Kobalt for $1.1bn. Now it’s turning it into bonds”, February 7, 2022, accessed: 2025-02-24.

[5] Reuters, “SESAC sells $560 million in bonds backed by music royalties”, August 2, 2019, accessed: 2025-02-24.

[6] Bloomberg, “Adele License Charges to Assist Fund $335 Million of Bonds”, July 1, 2022, accessed: 2025-02-24.

[7] Music Enterprise Worldwide, “Music’s bond journey continues, as SESAC and Hipgnosis each launch nine-figure choices”, August 10, 2022, accessed: 2025-02-24.

[8] Music Enterprise Worldwide, “Harmony costs $1.8bn bond providing backed by over 1m music copyrights”, December 8, 2022, accessed: 2025-02-24.

[9] Billboard, “Kobalt Elevating $267M From Safety Backed by Tune Catalog Together with YoungBoy & Extra”, March 19, 2024, accessed: 2025-02-24.

[10] Music Enterprise Worldwide, “HarbourView raises $500m in debt financing led by KKR”, March 13, 2024, accessed: 2025-02-24.

[11] Music Enterprise Worldwide, “Blackstone’s Hipgnosis closes $1.47bn asset-backed securities transaction”, November 11, 2024, accessed: 2025-02-24.

[12] Kroll Bond Ranking Company, 2022, Hipgnosis Music Belongings 2022-1 L.P., ABS Pre-Gross sales Report, August 2, 2022.

[13] Ibid., p. 8.

[14] Ibid., p. 7.

[15] Ibid., p. 9.

* This weblog publish is predicated on the report IP Finance within the Music Business, which was commissioned by the World Mental Property Rights Group (WIPO).