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Royalty Exchange debuts ‘Private Syndicates’ with Cage the Elephant


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US firm Royalty Exchange has acquired a co-publishing share in the first four studio albums of rock band Cage the Elephant, for an undisclosed amount.

The catalogue will be one of the guinea pigs for a new initiative called ‘Private Syndicates’ developed by Royalty Exchange, which it says will get “accredited and institutional investors” to buy in to “larger music catalogues” – earning a slice of their royalties in the process.

“Private syndicates give artists a strong financial foundation for both their personal and professional future, and shows Royalty Exchange can deliver results for any artist … from a single song to multimillion dollar catalogues,” said the band’s manager Cliff Burnstein (of Q Prime) in a statement. “Financially empowering artists is the key to creative control, which is the most important factor to achieving true longevity.”

Royalty Exchange has created a ‘special purpose vehicle’ (SPV) to hold its share of the Cage the Elephant catalogue, with investors then buying shares in that SPV. Included in this case are mechanical, public-performance, sync and print royalties. More than 40 individual and institutional investors have already dived in – a Grammy award for the band’s fourth album ‘Tell Me I’m Pretty’ last year won’t have hurt.

The company is predicting “double-digit yield” for this particular catalogue, which it says is “based on the catalogue’s five-year compound annual growth rate, industry growth projections, and other factors”. Royalty Exchange also says that its second Private Syndicate offering will be announced in the next few weeks. The news comes shortly after the Denver-headquartered company opened its first satellite office, in Nashville.

Stuart Dredge

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