“When the frenzy started there really were not a lot of great places to reach for yield,” says Michael Bizenov, president of Sound Royalties, which specializes in royalty financing to music clients like Dominican rapper and dembow star El Alfa. “This was a place where you could find yield. As you have yield opportunities in other places, people who were in there as a commodity will stop and reallocate.”
Investors, industry lawyers and bankers said music royalties remain an attractive and stable asset class for those with a long-term appetite. However, those sources said, they expect a wave of consolidation to hit catalog investment firms as companies backed by financial industry investors seek to securitize or exit the investment by 2027.
“There is still a robust marketplace for the sale of music IP, but the ones who were in it because everyone else was in it are getting out,” says Bizenov.