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MBW Views is a series of exclusive op/eds from eminent music industry people… with something to say. The following op/ed comes from Chad Blackwell (pictured), a Co-Founder and Managing Partner of Dream Street Advisors, claimed to be “the first boutique M&A advisory firm focused on contemporary frontline labels and publishers”. Past clients include Range Music, LVRN, Epitaph, EQT, and Breakaway. Blackwell has previously worked as a senior finance executive across the entertainment industry.
Over the past five years, the music industry has deployed $35 billion-plus into existing copyrights in pursuit of bond-like yields. This tidal wave can lull us into thinking about the value of music in the context of assets.
But the reality is that people drive our business — artists, writers, and entrepreneurs. Unlike the fixed-income return profile of catalogs, investing in copyright creation like frontline offers private equity-like upside with the added security of an asset floor.
As competition for catalogs intensifies, we believe the alpha in our industry over the next decade will be driven by real people, and independents have already taken center stage.
Indie Music’s New Golden Era
Indie eras come in cycles. The ‘90s were ushered in by era-defining labels such as Jive, Sub Pop, and Epitaph. The 2000s were heralded by Cash Money and Fueled by Ramen. The 2010s saw the rise of Quality Control, Big Machine, and Big Loud, while raising an entire ecosystem of indie distributors. And now in the 2020s, we’re experiencing yet another indie cycle peak as industry growth reaches a crescendo.
According to MiDIA Research, indie labels captured an additional 0.5% of market share in 2023, capping a three-year stretch of share expansion where indies have grown at a ~20% premium to the majors while achieving $10 billion-plus market size.
Consumption today is defined by fractured listening, algorithmic curation, and short cycles of virality. The data suggests that indies are thriving in this new market: while consumption in Spotify’s Top 100 tracks grew by ~20% between 2018 and 2024, the 101–200 chart positions grew by over 50%. Indies continue to power the middle market, as fans engage deeply with diverse content across more mediums (read: TikTok & Twitch streams) than ever before, and authenticity shines through.
“Consumption today is defined by fractured listening, algorithmic curation, and short cycles of virality.”
It’s no wonder indies are having a moment: they have always excelled at identifying and breaking artists that resonate with specific fanbases through long-term partnership. If you need proof, look at Rimas and Bad Bunny, COLTURE and Brent Faiyaz, PULSE / ISO Supremacy and Tommy Richman – these achievements are just the latest entries in a storied independent history of driving culture and commerce.
This cycle peak has come, as it often does, at the end of a maturation period. As DSPs approach saturation in mature markets, the majors have turned their focus to corporate hygiene and margins. In this environment, it’s more capital efficient for them to let the indies build repertoire while they consolidate. This dynamic always creates an opening for indies to define the next generation, and we’ve already begun to see this happen – but with one key difference.
It’s Always About the Music, But It’s Also About the Money
10 years ago, if you were an indie looking to sell or raise capital, you had three companies to call. Now, you might have 75. Today’s industry is marked by the influx of new sources of capital and increased financialization, fundamentally reshaping the landscape of strategic options.
So who are these 75 new potential partners? They’re still the “mini-majors” like Concord, Kobalt, and Believe, backed by retail investors, pension funds, private equity, and growth tech investors. They’re global asset managers like BlackRock, Apollo, and PIMCO, who have entered the IP market as LPs and creditors in copyright funds and other aggregation vehicles.
There’s also MUSIC, Vesper, and Flexpoint, which invest in growth equity. And they’re still the majors and their owned distributors, with fresh capital provided by the public markets. Additionally, lenders play a critical role in all contexts, with appetite for leverage rising from ~30-40% in the past to ~50-70% today, acting as a boon to activity across the market.
“10 years ago, if you were an indie looking to sell or raise capital, you had three companies to call. Now, you might have 75.”
In this environment, it’s no surprise to see majors defending regional and genre advantages through acquisition (Sony and Alamo, WMG and 10K, UMG and Mavin), as well as investing heavily in the independent distribution space (Sony and AWAL / Santa Anna, UMG and mtheory / Downtown), while other scaled players are matching that aggression (HYBE and Quality Control / Ithaca, Concord and PULSE). IP funds are also participating in the fervor by writing massive checks for catalogs (Litmus and Katy Perry, Primary Wave and Stevie Nicks).
Growth and investment have also driven up prices. A decade ago, copyrights traded at 10x or less – today, the most premium assets trade for 30x+. This influx of new money coincides with our current cycle peak, directly translating to big exits — several of the past decade’s defining independents have achieved nine-figure sales.
Why Financial Expertise Matters
There are 75 buyers to call on any deal, but you need to know what you’re asking for. Each potential partner has their own investment criteria, deal structures, and return hurdles. This longer menu of options means that deal processes are more complex – sellers are no longer going to the same 3 names asking for the highest price. Structure is critical, and good advice is advised.
If you’re an indie mainstay and it’s time to crystalize your value, there are catalog buyers aplenty. If you’re focused on maintaining ownership, look at debt. If you don’t mind having partners, minority investment is now an option, with better margin economics than traditional joint ventures – but you’ll need to make sure the bells and whistles don’t cause you to lose control.
If you need to launch a global chart success at the push of a button, joint ventures remain on the table if you can negotiate an appropriate exit mechanism. However, the majors are now oftentimes the sellers, and indies should be equipped to raise capital to buy out their partners. Scaled catalogs can be securitized via ABS vehicles to pay dividends or fund growth, or baskets of copyrights can be sold off at a premium to financial buyers.
“There are 75 buyers to call on any deal, but you need to know what you’re asking for.”
This increasing financial complexity demands a new approach to M&A and fundraising. In addition to strong legal teams, operators need financial advisors with a direct and sophisticated understanding of capital markets, investment structures, and the evolving strategic landscape in the music space. A sophisticated advisor can help assess the full range of available capital options, identify the best path forward, and execute transactions with precision. Traditionally, this advice has been limited to the largest companies — now, firms like our own can offer the same know-how to independents.
Create Culture, Get Smart, and Get Paid
This positive cycle will last for a while — indies remain a goldmine and there are a lot of investors looking for gold. Seizing the moment requires a blend of creativity, strategy, and financial acumen.
Investors need to understand the risk-reward profile of the people that drive the value of this business. Indies need to understand the full menu of options and how to pick a partner that’s aligned with their goals.
And strong advisors will be able to speak to both sides of the aisle to ensure that this golden era leaves a lasting legacy — both for their businesses and for the artists and communities they serve.Music Business Worldwide