For hip-hop fans who are looking to bolster their investment portfolio, you may be able to make some decent cash from a previously untapped source: Eminem's song catalog.
According to Billboard Biz, the entity known as Royalty Exchange has formed a new company and have already signed a document stating their intent to buy at least 15 percent of an income stream of royalties that is derived from Eminem music. He's not the only artist in their crosshairs, with plans to buy other music-related assets and take this new company, called Royalty Flow, public. At some point today (September 25th), they're expected to file with the U.S. Securities and Exchange Commission to raise between $11 million and $50 million from a regulated crowdfunding initiatve. If they meet their minimum funding target, it will then list with NASDAQ, as long as it meets the exchange's regulations.
Royalty Flow plans to buy either 15 percent or 25 percent of an Eminem income stream that is based on royalties that are paid to FBT Productions, an organization that often works with Em and produces his music. The royalties have been derived from albums released between 1999 and 2013 on the Aftermath Entertainment/Interscope Records label. This time frame includes records like The Marshall Mathers LP, The Eminem Show and The Slim Shady LP. Some Eminem tracks from other side projects have also generated royalties that are paid to FBT.
According to the report, the Eminem catalog has sold 172 million albums worldwide,with Nielsen Music confirming that 47.4 million of those units have been sold in the United States alone. Joel Martin, who manages FBT Productions, and Royalty Flow CEO and Royalty Exchange president Jeff Schneider agree that the plan is to let Eminem fans and investors reap some financial benefit for the performance of the records and the subsequent royalty payout, once it's listed on the NASDAQ. At the outset, minimum investment is $2,250 for 150 shares, giving anyone thinking of buying in the equivalent of roughly $15 per share. There's no shortage of cash flow for this opportunity too, with estimates revealing that FBT has been paid $47.2 million since 2011, which is an average of $7.9 million a year.
“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,” Royalty Exchange CEO and Royalty Flow’s chairman Matt Smith said in a prepared statement. “It also gives artists, producers, labels, songwriters, publishers and other rights holders a powerful new financing option with a level of transparency seldom found in the music industry.”
Will you be investing in Em's catalog? Let us know below.