Everything you need to know about income contracts

Monetizing Income Contracts

Income contracts are a unique asset class that we auction on our site. These are private contracts that entail the payment of proceeds out of a company's revenue.

While these deals generally do not involve a royalty right created by intellectual property law — they can be a very lucrative investment.

Here are a few examples of income contracts:

  • Franchise royalties. Creators of valuable franchises generally collect a percentage of the revenue generated by the owners and operators of their franchise locations.
  • Synthetic royalties. This is an alternative financing mechanism where a company pays investors a royalty on the revenue generated by their business, in exchange for growth capital.

These deals can be quite attractive to investors because investors get paid first. They're almost always paid a percentage of revenue (not profit). So investors in income contracts get paid before employees, before debt-holders, and before equity-holders. 

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How Royalty Exchange Works

  • We provide potential sellers with free no-obligation estimates
  • A seller’s listing agreement is signed, and the auction detail page is produced.
  • We work with the seller to identify the best auction Reserve Price for the royalty asset (if it doesn’t sell at reserve there is no cost to seller).
  • Thousands of investors bid and compete for the listing, driving up the value.
  • We handle the closing process and get the proceeds to the seller as quickly as possible.

Why You Would Sell Your Royalties

Investment: Upfront royalty payments can be a source of revenue to pursue possible investment opportunities.

Expand: Monetizing your assets can help you grow your business without losing control. 

Less Risk: Selling a portion of royalty revenue can decrease your risk. This can also be a good opportunity for company founders to take some money off the table. 

Personal Finance: Every transaction is completed in a timely manner, providing you with fast, upfront cash to meet your needs.

As a business owner or holder of an income contract, you may find that selling an income contract could be an excellent way to finance the growth of your business. We will work very closely with you to assure a suitable and time-efficient outcome for the sale of your income contract. If you would like to learn more or are interested in selling, please feel free to contact us!

“Royalty Exchange allowed me to capture the value of future income to reinvest in my current projects. This allowed me to retain 100 percent of my project”

Producer | Songwriter | Artist | Author | Filmmaker