When songwriter James Thomas had a family emergency, he needed to find a way to relocate his family and the money to do it.
Like many others in the music industry, Thomas earns money through royalties. As a songwriter of Kanye West's multi-platinum hit “Mercy,” he received music royalties whenever that song is played on the radio, on Pandora, purchased in iTunes, and streamed on Spotify or Apple Music.
But royalties take time to payoff. It can be years that a songwriter earns a significant amount from one song.
And selling royalties quickly has been a difficult challenge for artists in the past. Given that royalty streams are an illiquid alternative asset, it can be very hard for musicians to obtain a fair market price for them.
That's why Thomas turned to Royalty Exchange, an auction-based platform that brings together thousands of interested investors in royalties. Royalty Exchange showed tremendous flexibility to find a way to get Thomas the money he needed to help his family.
Royalty Exchange was able to give Thomas an advance on the expected sale of his songwriting royalties right away.
Then, within a few weeks, an investor purchased these songwriting royalties for $18,000.
That is more than eight times the annual payout for the royalties to this song.
The reason for this success - Royalty Exchange's use of an auction system. An auction ensures that many different people consider the deal, helping to establish a fairer market price for the asset.
Thomas' other sales option didn't offer such good terms.
Other buyers wanted to purchase his full portfolio of music.
“They wanted to do a different deal,” he said. “They wanted to get all of my songs.”
Given that other songs in his portfolio also paid royalties, he didn't want an “All-or-Nothing” deal demanded by some administrative buyers.
Like many artists, Thomas found Royalty Exchange while doing research on the internet on “how to sell music royalties.”
Using Royalty Exchange, Thomas was able to sell the royalty streams to one song. This allows him to keep the rights to the rest of his portfolio, ensure payments from these royalty streams, and explore strategic options for his career in the future.
Thomas says he plans to use his sales proceeds to complete sound engineering school and to launch several projects on iTunes.
Thomas praised his experience using Royalty Exchange's platform.
“Everything with the business was perfect,” he said. “I appreciate the flexibility and the communication.”
For other artists considering a deal to sell their intellectual property, Thomas recommends Royalty Exchange.
“Definitely I would recommend it,” he said about Royalty Exchange. “This helped me in a huge situation. I believe that this is a good platform. [These] guys are very clutch.”
Are you interested in selling royalties to finance a new project?
You can receive a complimentary royalty valuation consultation.
Just contact Royalty Exchange, right here.