← Money Rehab with Nicole Lapin
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American Express Representative
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Nicole Lapin
Can I get you a refill?
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American Express Representative
You can stay fresh wherever your business travel takes you. That's the powerful backing of American Express. Terms apply. Learn more@american express.com Amex Business Imagine if.
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Nicole Lapin
You had a co host in your life. You know someone who could help manage your every day and do the things that you don't have time for. Well, unfortunately that's not something we can opt into in life, but it is something you can opt into as an Airbnb host. If you find yourself away for a while like I do, maybe for work, a long trip or a big life adventure. A local co host can help you manage everything from guest communications to check in to making sure your place stays in tip top shape. They have got you covered. These are trusted locals who know your area inside and out, giving your guests a warm welcome while you focus on your own starring role, whatever that might be. You know that I love how hosting on Airbnb helps you monetize your home, an asset that you already have that is a holy grail. And as a longtime fan of Airbnb, I have been telling everyone I know that they should be hosting too. But some of my busiest friends have been overwhelmed by this whole idea of hosting. But thanks to the new co host offering, they have finally signed up. So if you've got a secondary property or an extended trip coming up and you need a little help hosting while you're away, you can hire a co host to do the work for you. Find a co host@airbnb.com host I'm Nicole Lapin, the only financial expert you don't need a dictionary to understand it's time for some money Rehab. Taylor Swift just announced that she bought back the Masters to her music catalog and this is big news. If you're swifty, of course, but even if you're not, this is actually not just a story about Taylor. It is one of the most dramatic and high stakes stories in the history of the entertainment business. And the money trail touches on private equity, copyright law, billion dollar tours and affects the future of music. So I'm going to unpack the background of this deal, what it means not just for Taylor Swift, but for the entire music industry and how you can invest in your favorite artists. Because we can't forget show business is big business that we can profit from too. This saga starts back in 2019. Taylor had just wrapped up her stadium tour for Reputation, which at the time was the highest grossing North American concert tour in history and grossed over $345 million. She had already won Grammys, released six studio albums, and smashed charting and sales records. That year she left Big Machine Records, the Nashville based label that signed her as a teenager. She had moved over to Universal Music Group and negotiated a deal that gave her ownership of her masters, starting with the lover album in 2019. That was a power move and definitely the exception in the industry, not the rule. A master recording, by the way, is the original version of a song or an album, so it's the source from which all the copies are made. What makes ownership of masters so valuable is that it means you control how and when the song is used, like in commercials, movies, video games, and even live performances. If you own the masters, you also earn significantly more money when it's streamed, bought or licensed. Most artists don't actually own their masters. The record label usually owns the masters. That means labels are the ones that call the shots and are the ones that profit the most from the masters. In a perfect world, this is a fair agreement because the label incurs a lot of costs in order to represent and market their artists. So this is how they make back their money. Now, Taylor owning the masters under her agreement with UMG was a big deal. But the masters of her iconic first six studio albums, Taylor Swift, Fearless, Speak, Now Red, 1989 and Reputation, were all owned by her former label, Big Machine Records. And then Scooter Braun acquired Big Machine Records through his company, Ithaca Holdings. Scooter Braun is the music manager who's often credited with discovering Justin Bieber and has also represented artists like Ariana Grande, Demi Lovato and Kanye West. Someone with whom Taylor had a very public and messy history with. You know the lore. The deal gave Scooter control over Taylor's first six studio albums. Scooter paid a reported $300 million for the deal. And you can imagine how valuable Taylor's masters are. I mean, licensing alone here. Her songs have been in shows and movies like the Hunger Games, Grey's Anatomy Ball, where the crawdads sing, 50 shades darker, how To Be Single, Letters to Juliet, New Girl, the Bear, I Could Go on and on and On. And whoever owns the master recordings also has the exclusive rights to publicly perform the recording. This is why Taylor would later say that Big Machine Records wouldn't allow her to perform her own songs from her earlier albums at the American Music Awards. Swift was not consulted on this sale. In a statement posted at the time, she said, quote, for years I asked, pleaded for the chance to own my work. Instead, I was given an opportunity to sign back up to Big Machine Records and earn one album back at a time, one for every new one I turned in, end quote. That feels pretty predatory, right? It's like telling an author, yeah, you could have your previous book back, but only if you agreed to write a sequel and then give us that sequel too. So she walked away from that offer, and she made her feelings very, very clear. This deal, she said, stripped me of my Life's work. In 2020, an investment firm called Shamrock Capital bought Swift's catalog from Braun and paid reportedly more than $300 million for it. And remember, just one year earlier, Braun had paid $300 million for all of Big Machine, not just for Taylor's masters. She said that Shamrock gave her an opportunity to partner, but she rejected it once she found out that Shamrock's agreement with Braun allowed him to profit from her catalog for many years. She said Braun's ability to profit from her work was, quote, a non starter. Taylor's next move was pretty genius. She did something that very few artists have ever tried to do and no one has done with such success. She started re recording her old albums. The goal was to offer fans an alternative to the originals versions that she owns. These are the albums she released under the same name, just with that Taylor's Version edition in parentheses. She released Fearless Taylor's version in 2021, then Red Taylor's ver, then Speak now and 1989. Each one was a massive success. 1989, Taylor's version had an even bigger opening week than the original did. According to Billboard, it debuted with the equivalent of 1.65 million album sales in the U.S. making it the biggest week of her career at the time. The tortured poets department has since topped it. So this does sound genius and kind of like copyright infringement. You might wonder how Taylor can re release the same music, same song titles, and not get sued by the people who own her masters. Well, here's where music industry standards get really interesting. Typically, every song recorded by an artist signed with a label in the US anyway has two copyrights. The master recording, which is the aspect we've been talking about. And then there's a second copyright, the composition, which covers lyrics and music. So Taylor did own the composition rights for her first six albums, which allowed her to legally release her own versions of her back catalog. The next album that was on deck for re release was the Reputation album. Taylor has been teasing this for a hot minute now, and as of late last month, the first Taylor's version of a song off the Reputation album was included in a Handmaid's Tale episode. But honestly, we don't really need a Reputation re release anymore now because Taylor owns all of her Masters on May 30, Taylor announced that she bought back her masters from Shamrock Capital. She wrote to her fans a play on her own lyrics in a very Taylor way. She said, quote, I can't thank you enough for helping me reunite with this art that I have dedicated my life to but have never owned until now. The best things that have ever been mine finally actually are. She now owns her original recordings, music videos, concert films, album art photography, and even unreleased songs. The price was not disclosed, but sources told the New York Times that she paid close to what Shamrock had initially paid Braun beyond the catalog. Taylor owning her masters means that she'll bring in even more revenue from her work. Already, Taylor is number 21 on the Forbes ranking of the richest self made women, with an estimated net worth of 1.6 million billion. Billboard estimates that the masters of Taylor's first six albums made Shamrock Capital $60 million a year on average. If that trend continues, we can definitely expect Taylor's net worth to go up to nearly 1.7 billion, which would tie her with Kim Kardashian on the Forbes list. Now this story is incredible, but it's also incredibly rare. Not every artist gets to do what Taylor just did. Jojo, for example, the artist who became super famous for her song Too Little Too late in 2006, signed to Black Ground Records when she was a teenage nature. The label withheld her music and wouldn't allow her to release new material. She ended up re recording her early work too. Years before, Taylor made a cool but without the platform or the fan base that Taylor Swift has, her RE recordings didn't make the same kind of splash. Still, it was a statement. But examples of this go back farther. The Beatles catalog has changed hands a bunch of Times. In the 1980s, Michael Jackson outbid Paul McCartney for ownership of their publishing rights. McCartney didn't regain control until 2017 after a legal battle and the expiration of copyright terms. So Taylor's success here is not just a personal victory, it is a business case study. Her ability to create Economic leverage through the ERAS Tour Re recordings and sheer fan loyalty made it possible for her to reclaim her art. But let's just double click on the tour for a second. The Eras tour reportedly sold over $2 billion in ticket sales across 149 shows. It caused a Ticketmaster melt down, it sparked a bracelet economy, and it turned Swift into the GDP of a small country. With that kind of momentum, she didn't just revisit the past, she bought it. And she did what very few artists ever get the chance to do. She beat the system. So whether you're an artist, an entrepreneur, or an investor, there's a lesson here. Owning your work is everything. If you're working on your own business, negotiating a contract, or deciding how to monetize your creativity, remember Taylor, read the fine print, push for ownership, and never be afraid to bet on yourself. For today's tip, you can take straight to the bank. There are ways you can invest in your favorite artists right now while also empowering them to keep creative control. There are new platforms cropping up that let you invest directly in music royalties. Royalty Exchange, for example, lets you buy shares of music royalties so you can invest in the rights to a song that earns money every time it's streamed, used in a commercial, or played on the radio. It's like earning dividends from a stock, only this time the stock is a pop pop song. Just remember, like any investment, there are risks. And because royalty ownership is so new, this is particularly risky. If you believe in an artist though, this can be a way to back them and build wealth. But royalties can really fluctuate. Platforms can shut down and not every song is a hit. So don't spend any more money than you're willing to lose. Money Rehab is a production of Money News Network. I'm your host Nicole Lapin. Money Rehab's executive producer is Morgan Lavoy. Our researcher is Emily Holmes. Do you need some Money Rehab? And let's be honest, we all do. So email us your money questions moneyrehaboneynewsnetwork.com to potentially have your questions answered on the show or even have a one on one intervention with me. And follow us on Instagramoneynews and TikTokoneyNewsnetwork for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself, which is the most important investment you can make.