Multi-Platinum Pop Group: Echosmith

Be a “Cool Kid” and bid on earnings from pop group Echosmith, featuring their triple-Patinum hit “Cool Kids,” and much more.

$500,000

starting price (Reserve: $500,000)
Watch or Bid Where is the end date?

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.

Current Price: $500,000
Bidding Increment: $14,000
Dollar Age:

~ 5 Years

Last 12 Months' Royalties:

$139,151

Investment Term: 10 years*
Distributors:

ASCAP and Warner Music Group

Rights Included:

Public Performance, Sales, Streaming, Sync

Interests Included:

ASCAP: Songwriter (World)

Warner Music Group: Artist (World)

Track List:

ASCAP and Warner Music Group

First Distribution (paid 30 days from receipt):

ASCAP: August 12, 2019

Warner Music Group: September 30, 2019

Distribution Frequency:

ASCAP: Quarterly

Warner Music Group: Biannually 

Buyer Fees:

$500

* Please see the FAQ tab for more information on the 10-year investment term.

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Description

Up for bid is a valuable offering that features both songwriter public performance and sound recording royalties generated by the multi-Platinum, alt-pop band Echosmith.

The foundation of this asset is the group’s debut, Gold-certified album Talking Dreams. All twelve songs from the album are included in this catalog. Released in 2013, Talking Dreams boasts Echosmith’s most successful single to date — the triple Platinum smash “Cool Kids.”

The hit single peaked at No. 13 on Billboard’s Hot 100, No. 9 on Mainstream Top 40 (among other Billboard positions), along with successfully charting in 23 other countries. “Cool Kids” became Warner Record’s fifth highest-selling digital song of 2014 and propelled Echosmith into the pop spotlight. To date, the song has a staggering 323+ million spins on Spotify, while the music video has over 115 million views on YouTube.

Not surprisingly, “Cool Kids” is the highest-earning track, accounting for the majority of last year’s income from both distributors. On the musical composition side, “Cool Kids” is seeing the second-best year-over-year stability and strong international earnings thanks to the song’s (and Echosmith’s) global success.

As we look across both distributors, streaming is the leading source of income source for this offering. On the sound recording side, subscription streaming is the top revenue format, followed by ad-supported streaming, then downloads. With regards to platforms, Spotify, Apple Music, and YouTube are the top three sources of revenue.

Also featured in this catalog is Echosmith’s Platinum-certified “Bright,” which is the second-highest earning single. “Bright” was the second release from Talking Dreams and also charted on multiple Billboard charts. Other notable tracks include “Tell Her You Love Her,” “Come Together,” and “Let’s Love.”

Key Drivers

Sound Recordings & Record Labels: Sound recording royalties benefit disproportionately more from streaming than composition-based royalties. If Spotify pays 70-cents of every dollar on music rights, 60-cents of that goes to the sound recording copyright (which the label splits with the artist based on their contract agreement), while the remaining 10-cents goes to the composition copyright.

Record labels see significant benefits as a result. According to an analysis of publicly-stated financial results by Music Business Worldwide, labels Universal, Sony and Warner Music Group jointly turned over just over $6.93 billion globally last year from streaming income alone.

You can see this trend reflected in the catalog up for bid. In the last year, the majority of sound recording royalties came from subscription streaming services, closely followed by ad-supported streaming. This is good news for you as the investor, as it follows the industry macro trend of rising label streaming royalties paid by a major label, Warner Music Group.

Multiple Income Streams. The winner of this auction will receive royalties from various streams, generated by both the musical composition, as well as sound recording (actual recording of the music). It is rather unique to earn from both sides of the copyright. These income streams include:

  • Public 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.

  • Sales: Royalties paid to artists and producers when a recording is sold, which can be downloaded (on a platform like iTunes), as well as physical copies being sold (such as a C.D.).

  • Streaming: Royalties paid to artists and producers when a recording is streamed “on-demand” (like Spotify for example) as well as non-interactive streaming (Pandora).

  • Synchronization: Royalties paid to artists and producers for the licensing of a recording in music for a movie, TV show, or commercial.

Band Popularity: Echosmith is a multi-Platinum selling band that has a vibrant fanbase. With the success of their debut album Talking Dreams, the group shot to pop stardom with rave reviews from Rolling Stone, Teen Vogue, and ELLE, while having performed on TV programs like Ellen, Late Night with Seth Meyers, American Idol, The Tonight Show With Jimmy Fallon, to name a few. The band has also embarked on two headlining tours, along with numerous co-headlining tours.

In June 2019, Echosmith was featured in a collaboration single “God Only Knows” with contemporary Christian duo For King & Country and legendary hip-hop producer Timbaland. The band also plans to release new material in the near future. While the new releases are not part of this offering, the new material can help boost an artist's back catalog. The release of new music can lead to discovery among first-time listeners, and re-engage existing fans.

What Is Being Sold? 

Subject to the exceptions below, this asset includes an interest in the artist’s share of all record royalties attributable to the sound recordings specified on the Track List, currently distributed by Warner Bros. Records, Inc., and an interest in the songwriter’s share of all public performance royalties attributable to the musical compositions specified on on the Track List, currently administered by ASCAP.

Asset Exceptions: synchronization royalties attributable to the license of the recordings and compositions on the Track Lists in connection with the proposed Lively McCabe Entertainment audio-visual project tentatively titled “Cool Kids” will be split on a 50/50 basis between the seller and the purchaser of this asset.

NOTE ABOUT Detailed Data

Detailed royalty data is not available from Warner Music Group, as the recording artist’s royalty account is offset by costs that are tracked separately. Earnings presented in the listing represent the net total biannual payments for the sellers’ interest in the asset after costs and representative what will be assigned to the winning bidder.

About the Royalty Distributor

American Society of Composers, Authors and Publishers (ASCAP) is one of four United States performing rights organizations, along with BMI, SESAC & Global Music Rights. It collects license fees from music users on behalf of songwriters, composers, and music publishers and distributes them as royalties to those members whose works have been performed. For more information on ASCAP’s distribution schedule, click here.

Warner Bros. Records Inc. is one of the top major record labels in the world. They are the foundation label of the present-day Warner Music Group (WMG). Warner Bros. Records is home to a wide array of legendary artists with a rich catalog of contemporary hits and influential standards. With a commitment to artist-friendly policies and long-range career development, they continue to maintain a strong share of the label market around the world.

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