New £100m royalty fund set up to invest in UK music companies

A new royalty financing fund worth £100m has arrived in the UK market.

The cash is being overseen by veteran management executive Darren Michaelson (Smashing Pumpkins, Elton John), who is the exclusive consultant for the fund.

Michaelson tells MBW that the plan is to invest the money in SMEs and MMEs (small and mid-market enterprises) with a minimum annual turnover of £3m in the music and entertainment space.

The exec says that when the fund invests in a company it will take no shares, no seat on the board – and ‘no control whatsoever or forced exit’.

The investors are seeking a “small percentage of the company’s turnover” in return.

Michaelson adds that there will be no person guarantees or “onerous covenants”, and that the investment will be turned around within 30 days of agreement completion.

“I was approached as music is one of only two industries in the entire commercialised world that operates on royalties – the other being the mining industry.”

Darren Michaelson

“I was initially approached as music is one of only two industries in the entire commercialised world that operates on royalties – the other being the mining industry,” said Michaelson.

“This is an amazing opportunity for forward-thinking and fast-growing music and entertainment companies who want to be in control of their own future and need capital investment, but don’t want to cede any control whatsoever to private equity companies who have no idea how to run their business…”

Michaelson is also currently in the process of setting up a new management company, with former senior executive colleagues from the music biz, and says he has serious backing for the venture.

Further details will be issued shortly.

Anyone wishing to contact Michaelson can reach him at: [email protected]Music Business Worldwide