Musicians who sold their song catalogs for countless millions
Metro Boomin sells portion of his catalog for an impressive US$70 million
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MUSIC Entertainment
Hip hop super-producer Metro Boomin has just sold a portion of his catalog publishing rights for an impressive US$70 million. Shamrock Capital—the investment firm which acquired a portion of Dr. Dre's catalog for US$200 million, and famously bought the rights to Taylor Swift's first six albums in 2020—closed the deal with the Atlanta native on March 7, which included records like Migos' 'Bad and Boujee," Post Malone and Quavo's 'Congratulations,' and The Weeknd's 'Heartless,' all of which hit No. 1 on the Billboard Hot 100. At just 29 years old, and having only sold a portion of his catalog, it seems Metro Boomin has a very bright future ahead of him.
Over the past few years, news headlines keep popping up about musicians selling the back catalogs of their music for dizzying sums. The idea of an artist signing away the rights to their life's work seems strange, even if there is a great deal of money in it. So, what gives?
In the past, the publishing rights to a song would belong to the songwriter and the publisher (companies like Sony and Universal Music), while the recording rights usually belonged to the artist who performed the song and the record labels, with everyone involved earning royalties. However, when the world was shaken by the pandemic and the markets became unstable, investors noticed that the value of music didn't wobble. In fact, it was even on the rise. A few companies started to take advantage of the situation, leading to a rather sudden boom in music IP (intellectual property) investment. The reliable revenue that comes from music royalties has become an extremely attractive option, particularly as streaming has brought even greater value and consistency.
At the same time that investors were looking for stable income streams, musicians were suffering the hardest years of their careers. As the world was in lockdown, musicians couldn't make money from touring, and their careers came to an unexpected halt. Even the most established artists found themselves looking for alternative sources of income.
There's also the fact that in the US, upcoming changes to tax laws mean that a 20% tax will need to be paid on assets that sell for more than US$1 million. For artists who are thinking about selling catalogs worth tens if not hundreds of millions, that's a pretty big chunk to lose to the government. Savvy musicians are rushing to make their deals before the new tax laws come into effect.
For older artists who have more or less come to the end of an illustrious career, their music rights are by far their most valuable asset, and cashing them in for a huge lump sum means that they and their children will have financial security for the future.
From Bob Dylan to Justin Timberlake, it seems everyone and their mother are cutting multi-million dollar deals to sell their song catalogs. Click through this gallery to find out which musicians have taken the plunge, and for how much.
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