17-Year-Old Hip-Hop — Publishing Royalties

A 17-year-old publishing catalog features stable (and in some cases growing) earnings from critically-acclaimed hip-hop artists. 

$224,500

closing price

Auction Closed

Top Bid: Shigesuke K

The Theoretical IRR is a formulaic guideline based on an extrapolation of the normalized, historical earnings trend of the catalog. The Theoretical IRR is not a guarantee of future performance. It should be used for comparison purposes only. Each catalog has its own risk factors and the Theoretical IRR is not based upon a specific analysis of this catalog. Click here to view the basis for all Theoretical IRR calculations.

Historic royalty income is no indication of future royalty income. Future royalty income is dependent upon future sales and licensing revenue generated by the sound recordings or compositions associated with this listing.

Starting Price: $200,000
Bidding Increment: $3,500
Closing Price: $224,500
End Date: May 14, 2020, 3:00 PM MDT
Dollar Age: 17.84 Years
Last 12 Months' Royalties: $33,457
Investment Term: Life of author + 70 years
Distributors: BMG
Rights Included:

Mechanical, Public Performance, Sync

Interests Included:

Songwriter/Co-publisher (World)

Track List:

Track List

First Distribution (paid 30 days from receipt): September 30, 2020
Distribution Frequency: Biannually
Buyer Fees:

1% of closing price or $500 (whichever is greater)‡§

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What rights are included?

  Musical Composition Sound Recording
Copyrights included? No
Rights:
Mechanical
Public Performance
Sync
Sales
Streaming
Sync
Sources: Internet Streaming, AM/FM & Satellite Radio, Digital Downloads, CD Sales, TV/Film/Commercial Placements & Performances, etc. Internet Streaming, Satellite Radio, Digital Downloads, CD Sales, TV/Film/Commercial Placements & Performances, Samples, etc.
Distributors: BMG

Description

Recently, we listed the songwriter’s share of public performance royalties for a catalog of veteran hip-hop artists — you can review that auction here. That auction proved very popular. 

If you missed that opportunity, we are now listing the publishing side — featuring many of the same songs (with the notable exception of “Come Down”). 

The winning bidder will collect from three types of royalties: mechanical, public performance, and sync for the lifetime of the copyright of the included tracks. 

LISTING HIGHLIGHTS: 

  • 17+ year Dollar Age
  • Diversity in song age and income distribution
  • Growth across all royalty sources

FINANCIAL HIGHLIGHTS:

Royalties for this 17-year-old catalog grew year-over-year for the past four years. Last year’s total earnings increased by 22% compared to the prior year alone.  

Publishing earnings come from three different sources: mechanical, public performance, and sync. All three sources grew in the last year, with mechanical earnings increasing by 9% and public performance by 24%. Mechanical royalties are the foundation with 41% of last year’s total returns.

Sync follows with 24% of total royalties, up over the prior year thanks to two songs (“Definition” and “Respiration”) used in the docuseries Hip-Hop Evolution airing on Netflix. Combined, the two songs' mechanical and public performance earnings grew 8%, indicating growth outside the one-time licensing fees. This is also noteworthy as the two releases are 22-years-old. 

This collection has incredible diversity among its income distribution and song age. Release dates for income-producing songs range from 1998 to 2015, while the highest-earning song only accounts for 16% of last year’s income. This means you’re not tied to the success of a single title and there is built-in diversity from the mix of older and newer releases.

ABOUT THE CATALOG: 

This catalog features tracks from well-respected hip-hop acts of the late 1990s/early 2000s, such as Talib Kweli, Mos Def, 50 Cent, Hi-Tek, Common, and others. 

The foundation is Black Star’s 1999 critically-acclaimed album Mos Def & Talib Kweli Are Black Star. Notable titles from the record include “Respiration” (featuring Common) and “Definition.” 

The all-time top-earner is “Get In My Car” (2005) from rapper 50 Cent. The track is off the No. 1, Grammy-nominated album The Massacre. Also off the same album is “Ryder Music," along with The Game's "Ol' English" released in 2006. 

Finally, there is “Blast” from Reflection Eternal's 2001 album and the No. 1 rap single “Move Somethin’” from Talib Kweli and Hi-Tek, dating back to 2000. 

Key Drivers

Dollar Age. This catalog has a Dollar Age of 17.84 years. This means the majority of royalties earned in the last 12 months came from songs that have collected royalties for nearly 18 years. A high Dollar Age like this suggests stability and longevity.

A catalog containing mature works with consistent (and even growing earnings) is something worth noting as an investor. This can help sustain a catalog's earnings moving forward.

Income Mix. The winner of this auction can receive income in various ways:

  • Mechanical: Royalties paid to songwriters and publishers when music is sold (think CD or vinyl) but also when music is streamed (streaming mechanicals) “on-demand” (like Spotify).
     
  • Performance: Royalties paid to songwriters when music is performed publicly. Music played over the radio, in a restaurant or bar, or over a service like Spotify or Pandora is considered a public performance.
     
  • Synchronization: Royalties paid to songwriters and publishers for the licensing of a song in music for a movie, TV show, or commercial.

Diversity in Song Income Mix. Revenues are also widely distributed — the single highest-earning song only accounts for 16% of last year’s income. This means the catalog’s earnings are not tied to the success of a single track and provides built-in diversification.

Matching Right

This seller's publisher holds a matching right on any sale of the income generated by this catalog. The publisher will have the opportunity to match the winning bid after this auction closes. If you are the winning bidder, the publisher must first decline their matching right before you will be able to complete your purchase. For more information on how the matching right works, please email: info@royaltyexchange.com

About the Royalty Distributor

BMG Rights Management GmbH is an international music company focused on the management of music publishing, recording rights and music distribution. The company's head office is in Berlin, and it operates regional offices in New York, Nashville, Los Angeles, London, Madrid, Paris, Stockholm, Hilversum, Milan, Beijing, Toronto, Sydney, and São Paulo. BMG is the youngest and fourth-largest major international company in the music industry, with over 2.5 million compositions and recordings in its library.

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