Some of the biggest artists in the history of recorded music sold their catalogs in the last 9 months. Why?
2021 was an epic year for marquee music artists deciding to sell their music catalogs: Fleetwood Mac (in three separate deals), Mötley Crüe, Neil Young, Bruce Springsteen, Paul Simon and Bob Dylan. In the case of Bob Dylan and Bruce Springsteen, they had been manically retaining the master rights (the actual recordings) and the music publishing rights (the notes and words to the songs) for over 5 decades much to the amazement of their peers. These peers (in many cases), took the contracts and advance money offered by record labels and music publishers and thereby sold the control to their songs. Dylan and Springsteen did not and now they are reaping the rewards.
Why sell now? One answer might be: timing. Interest rates are very low and investors are looking for splashy high-visibility properties with a big return. Many finance and venture capital firms want their initial investments back for such deals in 18–24 months. However, given the track record of these iconic songs, the royalty returns are nothing short of a rock-solid annual annuity that bankers can collateralize and amortize. Therefore, they can lock in a solid return over a longer horizon and get their money back within a predictable formula. Now, those crazy sums of money ($550 million to…
