Billion dollar music rights contender says 'content is king'

It has long been a common slogan in the media industry: “Content is king. “ The idea is that intellectual property is vital for distri...

It has long been a common slogan in the media industry: “Content is king. “

The idea is that intellectual property is vital for distribution systems like cable TV or music streaming, so owning and controlling it can be a powerful lever and a valuable investment.

But one investor, Sherrese Clarke Soares, has a twist on the old brown: “Content is queen.”

For Clarke Soares, Founder and Managing Director of HarbourView Equity Partners, a new venture looking to invest in music copyright and other media assets, the evidence is on the board, where “the queen is the room. most powerful, ”she said. With technology enabling new entertainment platforms all the time – think social media and gaming platforms like TikTok, Tic and Roblox – the real master of the game must act with agility and determination, zooming in any direction as needed.

The queen “can move in a number of different directions and control the board,” Clarke Soares, 45, said in an interview, “while the king can’t really move that much”.

HarbourView is the latest player in what has become a high-stakes competition in the music business: ownership and control of song catalogs, which stream like Spotify and Apple Music, as well as a growing number of platforms. of social media and games, need to keep their users engaged.

The past two years have seen a flurry of music copyright deals and associated royalties, and investors have invested billions of dollars in the hunt. Bob dylan sold its catalog of compositions to Universal Music late last year for over $ 300 million, for example, and other recent hit deals have involved Paul Simon and several members of Fleetwood Mac.

HarbourView is backed up to $ 1 billion by finance giant Apollo Global Management, which will instantly place the new competitor in the league of top buyers as Hipgnosis Songs Fund, a British company that has already spent around $ 2 billion on catalogs of artists like Shakira and Neil Young; and BMG, which recently teamed up with KKR to spend $ 1 billion on music copyright.

Although Apollo, like KKR, is known as a major player in private equity, its investment in HarbourView is made through its credit arm. Bret Leas, Apollo’s global head of structured credit, said his investment was strategic and long-term, and not subject to the tight investment timeline of a typical private equity deal.

For Clarke Soares, the daughter of Jamaican immigrants, who grew up playing the piano, the idea that “content is king” – a phrase she put down – has a special resonance. She is a rare example of a black woman running a financial firm and acknowledges that the tagline partly refers to herself.

Speaking via video conference from a sparsely decorated home office in Newark, she explained that investing in music and focusing on minority artists has been at the center of her life for decades. Her application to Harvard Business School, she said, included a proposal for an investment platform to support artists of color.

“I wanted to make an impact on how the world viewed people like me,” she said, “and the fastest way to do that is with content, because it moves to places where you and I can’t go with our hands and feet. “

The music world also has very few black women in high-ranking roles. A to study This year, by the University of Southern California’s Annenberg Inclusion Initiative, found that among 4,060 senior executives at record labels, streaming services and other companies at the heart of the music industry, there there were 17.7 white men for every black woman.

Clarke Soares, a former managing director of Morgan Stanley who was most recently a managing director of Tempo Music Investments, another privately-funded investment firm, declined to say what deals she was seeking with her new company.

But she suggested she might be interested in areas that have garnered less attention or have been undervalued. While there has been no shortage of deals for the work of artists of color – this week alone, BMG announced a deal for Tina Turner’s musical rights – the biggest splashes were done on iconic white artists like Dylan, Simon and the band Aerosmith. Catalogs outside of this mainstream may be valued at lower financial levels by investors.

“We want to invest differently, without being swayed by preconceptions,” said Clarke Soares. “Just because something is in the R&B sector, or in the Latin sector, we don’t think it should have a discount.”

Buying music copyrights can also involve delicate diplomacy with artists. Clarke Soares said that last year, while at Tempo, she was approached to invest in the main recordings of Taylor Swift, who had objected loudly because his work was purchased without his approval. Clarke Soares said she refused, not wanting to be in a confrontational position with an artist.

Nonetheless, HarbourView may face challenges as a new entrant in an extremely competitive market, a market where there is constant debate as to whether the prices are too high. Clarke Soares and Leas, of Apollo, argue that there is still value to be found and that HarbourView has the freedom to take a patient approach to deploying its capital.

The connection to Apollo was made in part through Reggie Love, who was an aide to former President Barack Obama, who is now a senior advisor to Apollo. They discussed ways to help diversify the world of finance and private equity, and Love said that in addition to the financial success they see in HarbourView’s model, Clarke Soares can serve as an example for the next generation.

“There will be some talented and aspiring young women of color who see themselves in her,” Love said, “and that will then give the vision, and hopefully the courage, to try to be the next Sherrese. . “

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Newsrust - US Top News: Billion dollar music rights contender says 'content is king'
Billion dollar music rights contender says 'content is king'
Newsrust - US Top News
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