SongVest CEO Talks Music Royalties, Streaming and ‘SongShares‘
SongVest gives fans an opportunity to invest in their favorite artists’ music.
Their platform makes it easy for any artist, songwriter, or rights holder to engage fan investors. It’s the opportunity to sell any percentage of any royalty stream for any term.
Fans can buy SongShares of their favorite hit songs and earn royalties as they accrue.
The opportunity to invest in hit songs is shaking up the music business, with SongVest leading the charge with their marketplace to offer unprecedented access to purchase fractional shares of music royalties from your favorite hit songs and artists.
Their mission is simple: democratize music investing.
We recently had the opportunity to chat with Sean Peace, Founder and CEO of SongVest, about what’s happening at SongVest, as well as gain some good insight on the process of building their platform for buying and selling music royalties.
P&S: What was the jumping-off point to start SongVest?
Sean Peace: Covid was the main driver for restarting SongVest after a long hibernation. While continuing to do underwriting and private catalog sales after exiting Royalty Exchange, Covid pushed me to get back into the market full-time because there was such a need to help songwriters with their financial needs.
Also, changes in securities laws allowed me to finally get to the goal I always wanted which was SEC qualified fractional ownership of music royalties.
P&S: What has been the experience like building and developing the business? Any specific roadblocks along the way? Surprises (good or bad)?
Sean Peace: Anytime you are dealing with the SEC on a new financial model — this one being music royalties — it is always a challenge to address all of their questions and concerns. The other challenge was having to integrate with other SEC compliant platforms because we were creating something unique in our auction platform that no one had already done before so that is always exciting.
Our biggest roadblock and surprise was the rise and then fall of NFT’s in music.
They totally drowned out our launch so we didn’t get the bounce of announcing this new model, but the good news is that it gave us more time to refine the model and position us for success in 2023.
P&S: Is there a specific strategy to draw more and more fans to your ‘SongShares‘ model? Is there a secret sauce in grabbing attention towards investing in royalties?
Sean Peace: Unlike other similar platforms like Rally and Masterworks who have to spend heavily on getting investors to the platform, our model leverages the artists’ fanbase.
Masterworks, for example, had over 30 people reaching out to investors and at one point was spending $1M a day on marketing.
The beauty of SongVest is that we partner with the artist to engage their own fanbase because that is our target market. While we will have some crossover from investors already on the platform, the majority of the buyers will already be fans of the artist.
P&S: What are your thoughts on the overall business of ‘music streaming?’
Sean Peace: I don’t think we are even close to what streaming will look like in 5 years.
Spotify still can’t make a profit and I am still trying to figure how who decided you should have all the music you want for $10 a month.
At some point the major labels are going to wake up and decide that for new releases, you don’t get it for free, that you have to pay, maybe for at least one year if you want to listen to it before it goes to the streaming services. I don’t remember anyone complaining about $0.99 cent singles, so streaming didn’t fix any consumer problem or dissatisfaction.
I would envision that some form of purchase or short-term purchase will come back and that there will be different tiers of services for streaming. One price should not get you everything unless the price is exponentially higher than it is now.
P&S: What’s your long-term view of the music royalties business? How do you see things progressing over the next few years?
Sean Peace: I believe that music royalties only have upside in the future.
While that upside may be small through CRB increases, if there is a revival in purchasing music or changes in the streaming models of pricing, that could all add a little bit more to the pie — but nothing game changing. I definitely don’t see a downside in the future.
P&S: What’s next for SongVest? Where is the business this time next year?
Sean Peace: We have just pivoted through our first business development hire to focus on artists and record labels. Traditionally we were songwriter and producer focused, and now with SongShares we have a great value proposition for the artist and record label to IPO a small percent of their royalties to fan investors.
So by the end of 2023 I expect that we will have solidified the value proposition and accelerated our growth across the board.
In addition, we will have the secondary market turned on for trading SongShares and we are very interested to gauge the interest in that.
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