DENVER (Sept. 25, 2017)—Royalty Flow, Inc. (“Royalty Flow”), a subsidiary of Royalty Exchange, the premier online marketplace for music and media royalties, today 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 superstar 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). [UPDATE: Following the distribution of the press release, Royalty Flow changed the share price to $7.50 with a minimum buy-in of 300 shares, maintaining the $2,250 minimum buy-in.]
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, please visit www.royaltyipo.com.
About Royalty Exchange Royalty Exchange helps artists and rightsholders raise money by connecting them with private investors on the world’s first premium marketplace for royalty generating assets. Creators love us because our transparent marketplace helps them get fair market value for their work. Investors love us because we help them diversify into uncorrelated, income-generating assets. And our commitment to transparency and honesty ensures value for all. Follow us on Twitter and Facebook.
About FBT/Bass Brothers
The Bass brothers, and their company FBT Productions, is the production team made up of Mark and Jeff Bass. Both are exceptional musicians, but their true talents lie in producing, working with the likes of Quincy Jones, George Clinton, D-12 and, of course, Eminem. After discovering and signing Eminem in 1995, the Bass brothers developed his signature musical style, producing and/or co-writing more Eminem tracks than any other producer on his most successful albums. This relationship garnered not only multiple Grammy awards, but also the Academy Award in 2003 for Best Original Song, “Lose Yourself.”
No money or other consideration is being solicited for our Regulation A+ offering at this time and if sent in to Royalty Flow will not be accepted. No offer to buy securities in a Regulation A+ offering of Royalty Flow can be accepted and no part of the purchase price can be received until Royalty Flow’s offering statement is qualified with the SEC. Any such offer to buy securities may be withdrawn or revoked, without obligation or commitment of any kind, at any time before notice of its acceptance given after the qualification date. Any indication of interest in Royalty Flow’s offering involves no obligation or commitment of any kind.
The securities to be offered will be highly speculative. Investing in shares of Royalty Flow will involve significant risks. Investment will be suitable only for persons who can afford to lose their entire investment. Furthermore, investors must understand that such investment could be illiquid for an indefinite period of time. No public market currently exists for the securities, and if a public market develops following the anticipated offering, it may not continue.
This news release contains forward-looking statements. Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as "expects," "estimates," "projects," "anticipates," "believes," "could," and other similar words. All statements addressing events or developments that Royalty Flow expects or anticipates will occur in the future, including but not limited to, the success of its crowdfunding campaign, listing on a securities exchange and development of a market for its securities, and its business strategy, including acquiring future royalties. Because they are forward-looking, they should be evaluated in light of important risk factors and uncertainties, including without limitation: Royalty Flow’s ability to execute its equity crowdfunding and future growth strategies, the state of the music industry and payment under royalty interests, and the future popularity of Eminem. Should one or more of these risks or uncertainties materialize, or should any of the Royalty Flow’s underlying assumptions prove incorrect, actual results may vary materially from those currently anticipated. In addition, undue reliance should not be placed on the Royalty Flow’s forward-looking statements. Except as required by law, Royalty Flow disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this news release.