< 2 min read – Written by a human, not AI!
I was in LA last month meeting with music managers, business managers, and some artist clients of ours. None of what’s happening in LA right now is brand new, but the pace of change out there is something people are starting to feel.
Catalog sales are still happening, but the 2019 to 2023 rush has cooled from both buyers and sellers. Why? Multiples aren’t what they were, as capital isn’t as cheap with interest rates where they are. But more artists are thinking about selling for different reasons now.
I can best summarise this as, “what if AI kills my future royalties?”
This creates an interesting place to be selling from. Not many good decisions come from fear, but you have to get it. Creatives are genuinely unsure how AI will affect them over the next few years, and they’re seeing what’s happening in other industries locally as well.
These capital events are often an introductory point for what we do, because what used to be regular income funding a lifestyle suddenly turns into one big capital event. But interestingly now, with smaller sums for catalogs and less certainty of work, it creates a challenging planning dynamic for us to juggle.
Onto AI. It came up in almost every conversation, not just in music but across entertainment. It’s been well reported, but there’s noticeably less work around film and TV right now, and people are starting to feel that. In music, I met with a manager who also runs his own label; they’re in the middle of a major rethink, planning to close the label and focus purely on management.
The volume of new music going online is unbelievable, it’s said to be around 100,000 tracks a day. With that kind of noise, you can’t just upload something and hope it lands. Artists have to be visible, they have to build audiences organically, and that usually means touring, which often isn’t a profitable exercise.
For labels, who often front a lot of the costs of creating music, AI is forcing them to look at how they fundamentally work and who they’re prepared to advance money to.
Movement of people is another theme, maybe because that’s our bag! But the flight of capital and people is real right now. LA still feels like a bubble, but there is noticeable tension being felt. More artists are quietly thinking about life outside the US, worried about politics, the weakening dollar, or just wanting a change of scene.
The UK, Portugal, and the UAE are the top destinations. The UK in particular works well. It’s culturally familiar, easy to work, film or record here, has good schools, and for new arrivals there are some useful tax reliefs and a strong double taxation treaty with the US that makes life simpler(ish).
From my side, it just feels like people are re-evaluating things, how they earn today and tomorrow and where they live. It’s not quite panic, but there’s definitely unease. People know things are shifting, and that it makes sense to be prudent and think ahead.
David James Wealth USA is an Appointed Representative of Blacktower Financial Management Limited and a member of Nexus Global (IFA Network) which is a trading name of Blacktower Financial Management Limited who are authorised and regulated in the UK by the Financial Conduct Authority. FCA Reference: 188611.
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