Royalty Flow, Inc. (“Royalty Flow”), a subsidiary of Royalty Exchange, the online marketplace for music and media royalties, has filed to offer its shares to the public under Title IV of the 2012 JumpStart Our Business Start-up (JOBS) Act, known as “Regulation A+”, paving the way for individuals to invest in iconic music royalties.
Royalty Flow intends to acquire and hold royalties from music catalogs of the world’s biggest music artists. The first of these iconic music catalogs will be the production company’s master sound recording royalties from the 1999-2013 recording catalog of hip-hop artist Eminem.
Royalty Exchange is working with the Detroit producers who first signed Eminem, Jeff and Mark Bass—co-founders of “Funky Bass Team” (FBT) Productions—with their manager Joel Martin, to bring this opportunity to fans and investors alike.
To make this possible, Royalty Exchange created Royalty Flow, a one-of-a-kind company designed to acquire and hold royalty catalogs of music and other media.
Individual and institutional investors can buy shares of Royalty Flow—and with it share in the previously privately owned royalty catalog it holds—through an equity offering the company filed for today. Royalty Flow targets raising between $11 and $25 million.
Royalty Flow’s Regulation A+ offering will begin after the SEC qualifies the filing, expected sometime in October. Minimum buy-in is expected to be $2,250 for 150 shares ($15 per share). Following this “mini IPO,” Royalty Flow intends to list on a public stock exchange, where anyone can buy and trade shares and be eligible to collect dividends from the EMINEM royalties, as well as other world-class royalty assets as they are added.
“Royalty Flow gives investors the opportunity to participate in assets that are uncorrelated with public markets, and directly benefit in the music industry’s growth,” said Matthew Smith, CEO Royalty Exchange and Royalty Flow’s Chairman. “It also gives thousands of artists, producers, labels, songwriters, publishers, and other rightsholders who contribute to the success of the superstars they work with access to on-demand financing options with the kind of flexibility seldom found in the music industry.”
The Bass brothers and FBT own producer credits and additional royalties on all Eminem recordings and releases from 1999 - 2013. They are making up to 25% of their master sound recording royalties in the EMINEM recording catalog available to investors through Royalty Flow.
This includes all EMINEM albums released in that timeframe (such as the diamond-certified The Marshall Mathers LP and The Eminem Show) as well as other Eminem projects, contributions, and recordings.
With more than 172 million albums sold in his career, Eminem is the second best-selling male artist of the last 25 years. Four of his albums remain on the Billboard 200 today, three are among the top 20 longest-charting albums of all time, and one—Curtain Call—was recently named the longest-charting hip-hop album in history.
The Bass brothers and Martin are groundbreaking champions for artists’ digital rights. They successfully fought for higher royalty payments for digital downloads and streaming, and won a landmark legal victory with an award of a substantially higher rate than paid to most producers or artists.
“We believe Royalty Exchange is the new model for music financing,” said their manager, Joel Martin. “We’ve supported increased transparency for artists our entire career, and Royalty Exchange is no different. They give investors simple, direct access to royalty opportunities that previously were available only to industry insiders. This changes everything.”
To register for updates on the Royalty Flow crowdfunding campaign, or to get more information, visit royaltyipo.com.
