Investors will soon be able to purchase shares of Eminem’s “My Name Is,” “Lose Yourself” and every other song he released from 1999 to 2013 on an exchange much like the stock market, at a minimum of $2,250. The rapper’s former production duo, the Funky Bass Team (aka FBT Productions), signed Eminem years before he turned into a superstar, and will auction portions of his future song royalties in October as part of a new company called Royalty Flow. “If you own any Apple stocks, for instance, it’s exactly the same,” Matthew Smith, head of Royalty Exchange, the Denver company running the auction, tells Rolling Stone. “Not only do you potentially get to earn along with Eminem’s catalog, but you also win the ultimate bragging rights to say ‘hey, I own that!’ anytime you hear one of his songs.”
The Eminem catalog is among the first of what Smith and others expect to be a new way for fans to invest in musicians and songs. With streaming revenues expected to boom over the next few years, the returns could become substantial. Royalty Exchange has already sold shares of Wiz Khalifa’s “See You Again,” Chris Brown’s “Drunk Texting” and the Ariana Grande-Lil Wayne track “Let Me Love You” as part of investment packages, some for as much as $71,000. The portion of “See You Again,” made available by a background singer who owned part of the recording rights, generated $11,372 before it went on sale through Royalty Exchange — and Eminem has far more revenue potential.
“With that big growth, there’s an opportunity for investors to participate,” Smith says.
Eminem declined to comment for this story, though one of his reps said he was “not consulted” about the upcoming investment package. “Eminem is not involved in any deals for the sale of recording royalties and has no connection to this company,” the rep tells Rolling Stone.
One music-business expert argues tearing apart an artist’s catalog and selling it piecemeal, without involving him, is disrespectful. “It starts to look like human slavery,” says Aram Sinnreich, an American University media professor and author of The Piracy Crusade. “For Joe Investor, sure, it’s no more or less meaningful than any other kind of commodity traded on exchanges — but we need to think about what kind of commodity we want human expression to be. It’s very different than iron ore or rare earths or something like that.”
A rep for Jeff and Mark Bass of FBT Productions, though, responds that publishers and record labels constantly profit off artists’ work and Royalty Flow is just another way of doing that. Joel Martin, FBT’s manager, says the company considered selling its catalog to a bigger company within the music business but ran into roadblocks. “They wanted to buy the controlling rights,” he recalls. “This is way more attractive.” Eminem worked with the Bass brothers for years, until, as Jeff Bass said in 2013, “Life just moves on. It’s not like [Eminem] said, ‘Jump! You’re fired.’ It was just, ‘I’m gonna go in a different direction.’ ‘Cool, I wish you the best of luck.'”
Royalty Flow will file for its initial public offering on Monday; after three weeks, the U.S. Securities and Exchange Commission will decide whether to approve the filing, and if it does, investors can buy in for 150 shares or more at the minimum $2,250 price. Later this year, those investors will be able to buy and sell shares on a public exchange.
When it’s all over, investors will own either 15 or 25 percent of FBT’s Eminem royalties as part of a broader package that could eventually include other artists’ songs. “You’re going to find a class of artists that will certainly be looking into this,” Martin says. “[They’ll] find out the real value of their income streams, as opposed to going to [major labels] Sony or EMI and taking a deal that looks good but may not be the best deal.”