[ADVANCE] Fixed-Return Brazilian Funk/Pop
Collect $40,000 in sound recording royalties generated by tracks from Brazilian duo Bonde R300.
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Historic royalty income is no indication of future royalty income. Future royalty income is dependent upon future sales and licensing revenue generated by the sound recordings or compositions associated with this listing.
| Starting Price: | $28,000 |
| Bidding Increment: | $250 |
| Closing Price: | $32,500 |
| End Date: | Apr 16, 2021, 3:12 PM MDT |
| Dollar Age: | 1.84 Years |
| Last 12 Months' Royalties: | $31,718 |
| Investment Term: | Fixed Return Amount (See Note Below) |
| Distributors: | Vydia |
| Rights Included: | Sales & Streaming |
| Interests Included: | Artist & Rightsholder (World) |
| Track List: | |
| First Distribution (paid 30 days from receipt): | May 15, 2021 |
| Distribution Frequency: | Monthly |
| Buyer Fees: | 1% of closing price or $500 (whichever is greater)ठ|
‡ Investors placing the opening bid on any listing pay no buyer fee if they win the resulting auction, a savings of 1% off the final price (minimum $500). All Access members who already receive this discount will be rewarded with a cash rebate equal to the buyer fee.
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What rights are included?
| Musical Composition | Sound Recording | |||||||
|---|---|---|---|---|---|---|---|---|
| Copyrights included? | — | No | ||||||
| Rights: |
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| Sources: | Internet Streaming, AM/FM & Satellite Radio, Digital Downloads, CD Sales, TV/Film/Commercial Placements & Performances, etc. | Internet Streaming, Digital Downloads, etc. | ||||||
| Distributors: | — | Vydia |
Description
Place a bid on monthly sales and streaming earnings from songs performed by popular Brazilian funk group Bonde R300.
This is a fixed-return asset, meaning the winning bidder will receive monthly payments until a total amount of $40,000 is collected (“Total Return”).
HOW THIS INVESTMENT WORKS
This asset offers the right to collect royalties up to a Total Return of $40,000. With this advance-style investment, the amount of return is known upfront. The only variable is the time it takes to collect that total.
Fixed-return investments are designed for younger catalogs such as this. Knowing the total return in advance helps reduce the overall risk profile. To that effect, below are three return scenarios we created to approximate the time it may take to collect the Total Return. These scenarios were designed based on an analysis of the earnings history to date.
Return Scenario Details:
To approximate the payback period, we will look at the historical earnings for the asset to determine three possible scenarios:
- Baseline: Monthly payments decline by 4.9% per month through Year 1 of the forecast, then decline by 3.5% per month for Year 2, with a final annualized decline of 2.9% after that. The Total Return would take 33 months to collect.
- Optimistic: Monthly payments decline by 2.6% per month through Year 1 of the forecast, then decline by 2.7% per month for Year 2, with a final annualized decline of 2.9% after that. The Total Return would take 21 months to collect.
- Conservative: Monthly payments decline by 6.7% per month through Year 1 of the forecast, then decline by 4.1% per month for Year 2, with a final annualized decline of 2.9% after that. The Total Return would take 49 months to collect.
FINANCIAL HIGHLIGHTS:
The top income source for this catalog is Spotify, accounting for 46% of earnings in the last year. Apple Music is second with 20% of royalties over the 12 months.
You’ll notice the growth rates for income sources are rather significant. That’s because all the tracks in the collection are new releases with only 25 months of earnings collected to date.
This catalog’s earnings are diverse, with the top-producing track accounting for only 10% of last year’s royalties. This means the catalog is not tied to the success of a single track and provides built-in diversification for you as an investor.
ABOUT THE CATALOG:
This catalog features music from Bonde R300 — an up-and-coming Brazilian funk/pop group. According to IFPI Global Music Report 2021, Brazil was again the largest market for recorded music in Latin America, with 2020 revenues increasing 24.5% over the year prior.
The highest-earning track is “Telefone Grampeado” with 10% of last year’s returns. Released in 2019 on Oh Nanana challenge, the song has over a million spins on Spotify while the official YouTube video has nearly 9.2 million views. Other tracks from Oh Nanana include: “Brisadão na Dela,” “Maconha E Sexo,” and “Marijuana de Fé.”
Bonde R300 has a healthy Spotify following with 525,000+ monthly listeners.
Key Drivers
Latin American Music Market. According to IFPI’s 2021 report, Latin America maintained its position as the fastest-growing region globally (15.9%) as streaming revenues grew by 30.2% and accounted for 84.1% of the region’s total revenues. Brazil is the largest recorded music market in Latin America with a 24.5% increase in revenues in 2020 — growth driven by an increase in streaming revenues of 37.1% and a strong rise in subscription streaming (28.3%).
Sound Recordings: Sound recording royalties benefit from streaming disproportionately more than composition-based royalties. If Spotify pays 70-cents of every dollar on music rights, 60-cents of that goes to the sound recording copyright (which the label splits with the artist based on their contract agreement), while the remaining 10-cents goes to the composition copyright.
WHAT IS BEING SOLD?
The seller’s interest in all sound recording royalties distributed by Vydia for the sound recordings listed in the Track List noted above. This includes sound recording royalties, as well as earnings generated by YouTube video streaming and ad revenue.
HOW DO PAYMENTS WORK?
Royalty Exchange will collect and distribute the royalties to the investor on a monthly basis. Please note these royalties are paid to Royalty Exchange in U.S. Dollars and will be paid to the winning bidder in U.S. Dollars as well.
The first payment will be on May 15th, 2021. Payments will continue until the investor collects $40,000 (“Total Return”). After the Total Return has been received, the rights to the royalties will revert back to the seller.
NOTE ABOUT CHANGE IN DISTRIBUTORS
This catalog had been distributed via digital distributor DistroKid until March 2021. It is now being distributed by Vydia. As a result, the investor's initial monthly payments may not include earnings from all digital service providers during the switch in reporting, but full reporting is expected to catch up in 1-2 months. As a part of the advance agreement for this sale, the seller will be required to continue to distribute the catalog via Vydia at least until the investor receives the Total Return.
About the Royalty Distributor
Vydia, Inc. provides an end-to-end solution to empower the next generation of music creators, managers, and labels. Their cutting-edge technology provides the digital infrastructure for audio and video distribution, content protection, rights management, advanced payments, and data tracking from one easy-to-use platform. Vydia distributes royalty payments to rightsholders on a monthly basis.