WEBVTT - Merck Mercuriadis 0:00:08.600 --> 0:00:12.240 Welcome, Welcome, Welcome to Canadian Music Week. In the Bob 0:00:12.360 --> 0:00:16.560 Left Sets the podcast. My guest today is Murk Peculiadest, 0:00:17.040 --> 0:00:21.640 who runs the hottest company in music today, the Hypnosis 0:00:21.680 --> 0:00:25.640 Songs Fun Mark. How's it going, Bob, It's a pleasure 0:00:25.640 --> 0:00:27.960 to be with you, mate for a long time. Okay, 0:00:28.480 --> 0:00:33.320 So you're constantly signing new acts, new catalogs. Do you 0:00:33.400 --> 0:00:37.520 reach out to people or do they approach you? Um, 0:00:37.560 --> 0:00:40.720 it's a combination of both. I would say that of 0:00:40.720 --> 0:00:43.479 the deals that we make are you know, people that 0:00:44.200 --> 0:00:47.000 who's music that I'm listening to, and when I'm listening 0:00:47.040 --> 0:00:49.560 to that music, it makes me reach out and turn 0:00:49.600 --> 0:00:52.080 around and tell people that, you know, I admire the 0:00:52.080 --> 0:00:54.080 work that they're doing and that I would like them 0:00:54.080 --> 0:00:57.200 to be a part of Hypnosis. But it's it's generally 0:00:57.280 --> 0:01:01.520 a long courtship. I I generally build the relationship with someone. 0:01:01.560 --> 0:01:05.280 In my case there you know, many of these relationships 0:01:05.640 --> 0:01:08.360 are relationships that have been built over ten, twenty thirty 0:01:08.480 --> 0:01:11.280 forty years at the time that I've been in this business. 0:01:11.319 --> 0:01:15.360 So you know, it's it's it's there's a bit of 0:01:15.600 --> 0:01:17.920 a love affair that's been going on for a long 0:01:18.000 --> 0:01:22.360 period of time generally before I approach anybody. But then, 0:01:22.400 --> 0:01:24.560 of course, on the back of success, you have a 0:01:24.560 --> 0:01:26.399 lot of people that pick up the telephone and want 0:01:26.400 --> 0:01:28.360 to be a part of what you're doing as well. Okay, 0:01:28.400 --> 0:01:30.840 let's talk about a couple of specific cases. You recently 0:01:30.840 --> 0:01:32.920 signed the Red Hot Chili Peppers. How did that come 0:01:32.959 --> 0:01:35.840 together so that when I can't talk about Bob and 0:01:36.959 --> 0:01:40.320 I apologize for that, But that's a deal that uh 0:01:41.040 --> 0:01:44.880 under n d A and that is is a deal 0:01:44.920 --> 0:01:48.160 that is is not something that we can talk about publicly, 0:01:48.200 --> 0:01:50.440 and I apologize. I should have said that at the 0:01:50.520 --> 0:01:52.960 very beginning. Okay, is there a deal that would be 0:01:53.000 --> 0:01:56.840 representative that you can talk about relatively recent? Sure, we 0:01:56.880 --> 0:01:59.840 can talk about Neil Young, we can talk about Lindsay Buckingham, 0:01:59.840 --> 0:02:03.760 we can talk about and let's talk about Shakira. Okay, 0:02:03.840 --> 0:02:07.080 let's start with Neil Young. How did you what was 0:02:07.120 --> 0:02:09.079 the entreaty with Neil Young? Did you reach out to 0:02:09.160 --> 0:02:12.600 him or do you reach out to you? Well, you know, 0:02:12.639 --> 0:02:16.560 I've had a relationship with Neil for about twenty five years, 0:02:17.040 --> 0:02:21.800 maybe longer. Um I was very close with his manager, 0:02:22.520 --> 0:02:27.040 Elliott Roberts, sadly who's no longer with us anymore. And 0:02:27.280 --> 0:02:30.079 Elliott was a bit of a mentor to me. We were, 0:02:30.280 --> 0:02:32.640 you know, we had a very similar approach to the 0:02:32.680 --> 0:02:36.960 way we did things, always integrity, lead um and Frank Geronda, 0:02:37.160 --> 0:02:40.600 who was Elliott's lieutenant for many many years and is 0:02:40.639 --> 0:02:44.840 now Neil's manager, was also part of of of that 0:02:44.880 --> 0:02:49.120 circle of of of friends around Neil, and it was 0:02:49.200 --> 0:02:52.000 there therefore very easy. I mean. The funny thing about 0:02:52.000 --> 0:02:56.080 the Neil deal was that when I first started to 0:02:56.120 --> 0:03:00.840 see investors, uh four or five years ago to educate 0:03:00.919 --> 0:03:05.760 them on the idea of songs as an asset class um, 0:03:06.080 --> 0:03:09.760 and I would explain to them, you know, the way 0:03:09.800 --> 0:03:13.080 that certain artists cared about music, and that it would 0:03:13.080 --> 0:03:17.320 be you know, the kind of equivalent of uh, you know, 0:03:17.440 --> 0:03:21.200 the songs being metaphorical children, uh, if you like. And 0:03:21.520 --> 0:03:26.120 therefore these were very emotional transactions that uh the artists 0:03:26.120 --> 0:03:29.160 would find uh, you know, difficult, and that they would 0:03:29.240 --> 0:03:31.640 want to make sure that they were putting those songs 0:03:31.760 --> 0:03:35.080 into the hands of the right people. I always used 0:03:35.160 --> 0:03:37.560 Neil as the example. I had over a hundred and 0:03:37.560 --> 0:03:41.880 seventy seven meetings with investors in the first twelve or 0:03:41.920 --> 0:03:45.480 thirteen months of of of hypnosis as an idea, and 0:03:45.520 --> 0:03:48.560 in every one of those meetings, Neil was always the 0:03:48.600 --> 0:03:52.200 example of the sort of artists that would do business 0:03:52.240 --> 0:03:55.160 with me as opposed to doing business with other people, 0:03:55.280 --> 0:03:58.320 because they would know that I cared about the music. 0:03:58.960 --> 0:04:02.840 They would know that I amderstood that these were emotional transactions, 0:04:03.240 --> 0:04:06.560 and that they looked upon these songs as metaphorical children 0:04:06.840 --> 0:04:09.280 that they've given birth to in the form of songs, 0:04:09.880 --> 0:04:11.680 and that they would want to know that those songs 0:04:11.680 --> 0:04:14.040 were going into the right hands. And you know, I've 0:04:14.280 --> 0:04:19.120 made my reputation and my success with artists and songwriters 0:04:19.120 --> 0:04:22.640 and producers as opposed to at the expense of artists 0:04:22.640 --> 0:04:25.800 and songwriters and producers, and therefore I have a pretty 0:04:25.800 --> 0:04:29.359 good name in the artistic community. They know that I care, 0:04:29.560 --> 0:04:31.760 they know that I'm prepared to fight on behalf of 0:04:31.800 --> 0:04:34.800 the songwriters and the artists and the producers. And they 0:04:34.839 --> 0:04:38.840 also know that, you know, perhaps most importantly, that while 0:04:38.880 --> 0:04:42.280 I'll always want to, you know, enhance the earnings and 0:04:42.440 --> 0:04:45.719 enhance their reputation, at the same time, I would never 0:04:45.839 --> 0:04:48.800 do that at the cost of protecting their legacy. The 0:04:48.920 --> 0:04:52.360 legacy is always the most important thing. And protecting the 0:04:52.800 --> 0:04:55.200 value of the songs and protecting how the songs are 0:04:55.320 --> 0:04:59.080 used as paramount. That's that's inherent. You know, when you 0:04:59.080 --> 0:05:01.400 look at someone like you young, you know, on the 0:05:01.440 --> 0:05:04.159 one hand, the songs are as valuable as they are 0:05:04.320 --> 0:05:08.840 because Neil is an incredible artist and a wonderful songwriter. 0:05:09.360 --> 0:05:12.200 But equally well inherent in that is the way that 0:05:12.240 --> 0:05:15.400 he's conducted himself over the past sixty years. The reason 0:05:15.440 --> 0:05:17.960 why people like you and I look up to Neil 0:05:18.240 --> 0:05:21.039 is because of that conduct. And I've read you write 0:05:21.040 --> 0:05:24.440 about Neil. Uh, you know, read what you've written about 0:05:24.480 --> 0:05:27.200 Neil many many times over the decades, and you have 0:05:27.240 --> 0:05:30.640 a similar passion to mind most of the time. And 0:05:30.800 --> 0:05:33.240 that's partly based on the fact that Neil is a 0:05:33.240 --> 0:05:35.919 guy that we can believe in. Okay, but walk us 0:05:35.920 --> 0:05:38.839 through the process of making a deal with Neil. Did 0:05:38.880 --> 0:05:41.840 you hear that he wanted to sell or did you 0:05:41.880 --> 0:05:44.840 approach Frank and tell him, Hey, I think this is 0:05:44.880 --> 0:05:49.560 an opportunity for you here. It's a it's a courtship 0:05:49.640 --> 0:05:53.960 that that has existed from the time that hypnosis started. 0:05:54.560 --> 0:05:57.680 Um And of course you know sometimes the artist will 0:05:57.680 --> 0:06:00.680 get to a place where they be it's the right 0:06:00.680 --> 0:06:03.000 time for them to make a deal like this, and 0:06:03.000 --> 0:06:05.560 other times it will never be the right time to 0:06:05.560 --> 0:06:09.599 to to to make a deal. In Neil's case, UM 0:06:09.600 --> 0:06:15.840 probably last October he decided that this was the right 0:06:15.880 --> 0:06:19.800 time for him to make a deal and to uh, 0:06:19.839 --> 0:06:21.919 you know, put the songs and let me just stop 0:06:21.960 --> 0:06:24.919 you for a second. That was totally independent of you 0:06:25.040 --> 0:06:27.560 talking to him. He basically woke up in bed one 0:06:27.600 --> 0:06:32.240 day and said today's the day, okay, correct continually and 0:06:32.000 --> 0:06:35.080 and and instructed his team that it was it was 0:06:35.120 --> 0:06:38.000 time to find uh, you know, the right people to 0:06:38.040 --> 0:06:41.240 do to make a deal with UM. So from that 0:06:41.279 --> 0:06:44.320 point it became very easy. You know, the lawyer and 0:06:44.360 --> 0:06:47.159 Frank reached out to me. I told them what I 0:06:47.200 --> 0:06:50.320 was prepared to do, literally within a matter of seconds. 0:06:50.880 --> 0:06:53.520 And ultimately, and you know, when you you have a 0:06:53.560 --> 0:06:56.400 career like Nils and and and you know you've got 0:06:56.440 --> 0:07:01.720 sixty years almost worth of incredible songs You've got obviously, uh, 0:07:01.760 --> 0:07:06.040 you know understand what the how the marketplace feels about 0:07:06.080 --> 0:07:10.040 your your catalog and your songs. But I was very 0:07:10.080 --> 0:07:13.080 confident that what I proposed to them right from the 0:07:13.080 --> 0:07:15.840 get go would prevail. And indeed it did, and the 0:07:15.920 --> 0:07:19.720 deal was done within about thirty days. Okay, so you're 0:07:19.800 --> 0:07:22.320 saying that within a matter of seconds you had a 0:07:22.400 --> 0:07:27.720 number that you could give them. What it wasn't wasn't 0:07:27.760 --> 0:07:31.000 even minutes, it was seconds. So how did you come 0:07:31.080 --> 0:07:35.720 up with that number? Because you know, as you may know, 0:07:36.120 --> 0:07:41.239 you know, the sort of general discussion around catalog sales 0:07:42.400 --> 0:07:45.120 is based on a multiple um. So for me to 0:07:45.200 --> 0:07:48.360 be able to express the multiple that I was prepared 0:07:48.400 --> 0:07:50.960 to pay for Neil just took a matter of seconds. 0:07:51.240 --> 0:07:54.080 You know. By that point, I was already you know, 0:07:54.160 --> 0:07:58.000 the better part of two billion dollars invested. I knew 0:07:58.200 --> 0:08:01.840 what these catalogs were trading ends for. And you know, 0:08:01.880 --> 0:08:03.680 the one thing that I'm never gonna do. And it 0:08:03.720 --> 0:08:06.680 doesn't matter whether you're as famous as Neil Young or 0:08:06.960 --> 0:08:09.320 you know, whether you're you're you're someone that you know, 0:08:09.360 --> 0:08:11.840 maybe as a decade into your your career, your life, 0:08:12.160 --> 0:08:15.280 I'm never gonna mess a great creator around. You know, 0:08:15.320 --> 0:08:18.800 my my modus opper endi is too. And this has 0:08:18.840 --> 0:08:22.600 been this way throughout my career. You know, if I 0:08:22.600 --> 0:08:25.440 believe that I should pay a dollar I'm not going 0:08:25.520 --> 0:08:28.680 to offer ninety cents and then let you talk me 0:08:28.760 --> 0:08:30.840 up to a dollar. I'm going to offer a dollar, 0:08:31.400 --> 0:08:34.240 and then if you want more, I'm gonna justify why 0:08:34.280 --> 0:08:36.920 I believe it's a dollar. So it's it's you know. 0:08:37.000 --> 0:08:41.640 My My approach is always to be as real as 0:08:41.679 --> 0:08:45.080 I possibly can be, and then if there's effort and 0:08:45.160 --> 0:08:48.520 time that's required to then explain and to justify why 0:08:48.559 --> 0:08:51.040 that's the number, and then I'm prepared to do it. 0:08:51.080 --> 0:08:53.319 But I don't. I don't try to nickel and dine people. 0:08:53.360 --> 0:08:55.320 I think that, you know, one of the things that 0:08:55.360 --> 0:08:58.360 I set out to do when I started hypnosis, there 0:08:58.400 --> 0:09:02.280 were three three goals. The first goal was to establish 0:09:02.400 --> 0:09:07.280 songs as an asset class that could rival golden oil um. 0:09:07.320 --> 0:09:11.600 The second was to use the leverage of hypnosis to 0:09:11.720 --> 0:09:14.440 then help to change where the songwriter sits in the 0:09:14.440 --> 0:09:17.920 economic equation, because despite the fact that they're delivering the 0:09:17.960 --> 0:09:21.600 most important component to an artist having success, they are 0:09:21.679 --> 0:09:25.120 the low man or woman on the in the economic equation. 0:09:25.640 --> 0:09:30.439 And then the third goal was to destroy the concept 0:09:30.520 --> 0:09:34.040 of traditional publishing, where someone gives you a check but 0:09:34.160 --> 0:09:37.720 doesn't really add much value beyond that and to replace 0:09:37.800 --> 0:09:41.240 it with song management. As as an artist manager, you know, 0:09:41.280 --> 0:09:45.960 I manage people with responsibility because I understand that. You know, 0:09:46.000 --> 0:09:48.560 first of all, I can't play the guitar, I can't 0:09:48.559 --> 0:09:51.440 sing a song, I can't write a song. The only 0:09:51.480 --> 0:09:53.120 thing that gives me a seat at the table with 0:09:53.200 --> 0:09:56.200 these great people is that I take my responsibility seriously 0:09:56.920 --> 0:10:01.040 and I think that that same responsibility should be extended 0:10:01.080 --> 0:10:04.040 to these great songs that make the world go round. 0:10:04.520 --> 0:10:08.720 But that's not what traditional publishing is. Let's get let's 0:10:08.720 --> 0:10:10.000 get downe in the nuts and bolts. So if you 0:10:10.040 --> 0:10:12.559 could make a deal or come up with a number 0:10:12.640 --> 0:10:15.959 that quickly. Did they tell you how much they were 0:10:16.040 --> 0:10:19.720 making from their catalog every year or is this something 0:10:19.720 --> 0:10:23.280 where you investigate all the available acts yourself and see 0:10:23.320 --> 0:10:29.160 how much they're making. So basically everything that we buy 0:10:29.360 --> 0:10:32.800 is bought on verified data. So the artist will supply 0:10:33.480 --> 0:10:37.760 the last three years of their publishing statements, the last 0:10:37.760 --> 0:10:41.480 three years of their p r O statements, the last 0:10:41.559 --> 0:10:45.800 three years of their you know, neighboring rights, sound exchange masters, 0:10:45.840 --> 0:10:47.960 depending on what it is, that's that's that's on the 0:10:48.040 --> 0:10:52.200 table um. But in the case of Neil, what I 0:10:52.240 --> 0:10:56.000 gave immediately was the multiple that I was prepared to 0:10:56.000 --> 0:10:59.800 pay for it. They then supplied me with that verified 0:11:00.000 --> 0:11:03.040 aid to within a couple of days, they had the 0:11:03.080 --> 0:11:08.040 formal offer back with that number, that yearly number times 0:11:08.040 --> 0:11:10.960 the multiple that I was willing to pay, and we 0:11:11.040 --> 0:11:14.640 were there very very quickly after that. What is the 0:11:14.760 --> 0:11:19.200 multiple that I can't talk about I'm under n d A. 0:11:19.720 --> 0:11:22.280 But but what I can, But in general, what I 0:11:22.320 --> 0:11:24.760 can tell you is this is that I've now invested 0:11:25.040 --> 0:11:28.000 over two billion dollars, about two point two billion dollars 0:11:28.480 --> 0:11:33.520 at an average weighted multiple of fifteen. So I've I've 0:11:33.920 --> 0:11:36.480 bought some catalogs for a lot more than a fifteen 0:11:36.520 --> 0:11:39.439 times multiple, and I've bought some catalogs for a lot 0:11:39.480 --> 0:11:42.280 less than a fifteen times multiple. But the average weighted 0:11:42.360 --> 0:11:47.400 multiple across the two billion invested is fifteen times. Okay, 0:11:47.480 --> 0:11:52.400 let's assume you pay fifteen times for your purposes. How 0:11:52.440 --> 0:11:54.880 long a period of time do you calculate it will 0:11:54.920 --> 0:11:59.760 take for you to recoup your investment. Well, it's probably 0:11:59.800 --> 0:12:03.559 something that's closer to ten years time rather than fifteen 0:12:03.640 --> 0:12:06.679 years time, because, of course, the context for all of 0:12:06.720 --> 0:12:11.120 this is the explosive growth of streaming where when we started, 0:12:11.440 --> 0:12:15.000 you know, just over three years ago, we had thirty 0:12:15.000 --> 0:12:19.040 million paid subscribers to music streaming services. Today we have 0:12:19.120 --> 0:12:23.360 four dred and fifty million paid subscribers. Then in addition 0:12:23.400 --> 0:12:27.920 to that growth, you know, you've got uh things like 0:12:28.040 --> 0:12:30.560 legislation that's taken place all over the world, such as 0:12:30.600 --> 0:12:34.319 the Copyright Board ruling in the United States that has 0:12:34.360 --> 0:12:37.960 given the songwriter a forty four greater share of the 0:12:38.000 --> 0:12:42.200 pie incrementally between two thousand and nineteen and the end 0:12:42.240 --> 0:12:45.320 of two thousand and twenty two. Now that's been appealed 0:12:45.320 --> 0:12:50.240 by Spotify and by Amazon, but not by Apple, and 0:12:50.240 --> 0:12:54.920 we believe that that increase will prevail. So by the 0:12:54.960 --> 0:12:58.720 time you get to the end of a dollar's worth 0:12:58.760 --> 0:13:00.760 of income that you bought will be worth a dollar 0:13:00.840 --> 0:13:04.800 forty four if it was predictable, reliable income. And then 0:13:04.840 --> 0:13:08.320 we go to work actively managing the songs better than 0:13:08.360 --> 0:13:11.520 they've been actively managed for a long time, because you know, 0:13:11.559 --> 0:13:14.680 the big publishing houses that administer many of these songs 0:13:14.840 --> 0:13:17.560 when we buy them, they have as many as twenty 0:13:17.600 --> 0:13:20.840 thousand songs per person. So as good as they are 0:13:21.040 --> 0:13:23.600 what they do, they don't have the ability to be 0:13:23.640 --> 0:13:27.240 able to affect the success of twenty thousand songs per person. 0:13:27.280 --> 0:13:29.839 They just don't have the bandwidth to do it. We 0:13:29.920 --> 0:13:33.440 operate on a basis of five hundred plus songs per 0:13:33.440 --> 0:13:37.320 person UM, never more than a thousand songs per person. 0:13:37.400 --> 0:13:40.520 We're adding all the time, so that ratio of between 0:13:40.559 --> 0:13:43.920 five hundred and a thousand songs changes depending on where 0:13:43.920 --> 0:13:47.880 we are between what we've acquired recently. So today we 0:13:47.920 --> 0:13:51.880 have acquired a hundred songs from Andrew Watt um Grammy, 0:13:51.880 --> 0:13:55.480 a winning Producer of the Year UM. But we're adding 0:13:55.520 --> 0:13:58.800 more people to manage those songs and manage the songs 0:13:58.840 --> 0:14:00.800 that are in the catalog on a glue basis, So 0:14:01.080 --> 0:14:04.160 it fluctuates between having five hundred and a thousand songs 0:14:04.160 --> 0:14:08.600 per person depending on where we are in that cycle. Ideally, 0:14:09.320 --> 0:14:11.840 as we get to the point where there's a steady state, 0:14:12.280 --> 0:14:14.880 it's five hundred songs per person as opposed to twenty 0:14:15.320 --> 0:14:18.320 songs per person, and those people are very focused on 0:14:18.360 --> 0:14:23.040 putting the songs in movies, TV commercials, video games, getting 0:14:23.080 --> 0:14:26.920 new artists to cover those songs, getting new songwriters to 0:14:27.000 --> 0:14:30.520 interpolate them, making sure that they're on TikTok, making sure 0:14:30.520 --> 0:14:33.920 that they're on Peloton, that they're on the right playlists, etcetera. 0:14:34.240 --> 0:14:37.520 So by the time you add all of those ratchets, 0:14:37.560 --> 0:14:40.600 you know, what is a fifteen times multiple probably becomes 0:14:40.600 --> 0:14:43.480 something less than a ten times multiple if you're doing 0:14:43.480 --> 0:14:47.760 your job properly. Okay, let's just use Neil Young as 0:14:47.760 --> 0:14:52.560 an example. So a lot of these older artists, Neil, Paul, Simon, 0:14:52.720 --> 0:14:56.160 Dylan have sold in. The conventional wisdom is they're doing 0:14:56.160 --> 0:14:59.640 it for tax reasons. In this particular case, you make 0:14:59.680 --> 0:15:03.920 it deal with all of these very highly well known, 0:15:04.480 --> 0:15:09.160 respected artists, is part of the negotiation where and how 0:15:09.240 --> 0:15:14.640 they get paid for tax reasons. Well, certainly they will 0:15:14.680 --> 0:15:18.920 have all had very very good independent tax planning. So 0:15:19.320 --> 0:15:22.720 you know, you you you are probably aware that under 0:15:23.080 --> 0:15:27.560 the Trump administration previously that at the mid terms last 0:15:27.600 --> 0:15:32.040 time around, Trump tried to get rid of, uh the 0:15:32.040 --> 0:15:37.240 the capital gains tax treatment for songwriters. Bart Harbison at 0:15:37.240 --> 0:15:39.880 the n s a I and Nashville stepped in with 0:15:39.960 --> 0:15:43.160 a very very heavy lobby and they were able to 0:15:43.280 --> 0:15:46.720 turn that around and keep the capital gains tax in place. 0:15:47.440 --> 0:15:49.920 We've now got what I think we all believe is 0:15:50.640 --> 0:15:53.960 a far, far better president and Joe Biden. But Joe 0:15:54.000 --> 0:15:57.280 Biden is also intent on, uh, you know, putting a 0:15:57.280 --> 0:16:00.440 tax program in place that will likely get rid of 0:16:00.480 --> 0:16:04.560 capital gains tax for songwriters. Whether that happens this year, 0:16:04.600 --> 0:16:08.119 whether it happens next year, it's certainly something on the agenda. 0:16:08.600 --> 0:16:12.160 I've been part of many, many discussions with the n 0:16:12.240 --> 0:16:16.360 s a I and various congress people around the country 0:16:16.440 --> 0:16:20.400 explaining to them number one that songwriters deserve capital gains 0:16:20.440 --> 0:16:23.480 treatment and number two that even if we just look 0:16:23.520 --> 0:16:27.880 at hypnosis, hypnosis has probably paid about five dred to 0:16:27.920 --> 0:16:32.600 six hundred million dollars into the treasury based on songwriters 0:16:32.640 --> 0:16:37.400 getting capital gains treatment. If that capital gains treatment were 0:16:37.440 --> 0:16:40.400 to go away, many many songwriters would have to think 0:16:40.440 --> 0:16:44.360 twice about whether or not they sold their songs. Okay, 0:16:44.360 --> 0:16:48.800 but specifically that would be the general leandscape. Do you 0:16:48.880 --> 0:16:51.240 just make a deal and say I'll pay you X 0:16:51.280 --> 0:16:53.640 for this, let's just use a hundred million dollars is 0:16:53.680 --> 0:16:57.600 around number? Or do they say we want you know, like, 0:16:57.720 --> 0:17:00.000 is it like a baseball player where they say, well, 0:17:00.120 --> 0:17:02.560 I want to be paid in Canada or I want 0:17:02.600 --> 0:17:07.280 to be paid. Here are those factors that Hypnosis is 0:17:07.359 --> 0:17:10.000 involved in at all, Where the money is generated, from 0:17:10.040 --> 0:17:14.680 where it goes. We're not involved in the factors because 0:17:14.720 --> 0:17:17.439 of course we're not advisors to the artist or the 0:17:17.480 --> 0:17:21.600 songwriter or the producer. But if the songwriter or the 0:17:21.720 --> 0:17:25.440 artist or the producer has a legitimate tax plan with 0:17:25.560 --> 0:17:29.640 their advisors, as long as it's a legitimate tax plan, 0:17:29.720 --> 0:17:33.439 we will do our very very best to cooperate and 0:17:33.480 --> 0:17:37.200 make the transaction and the sale of the catalog is 0:17:37.280 --> 0:17:40.040 smooth and seamless as as as the songwriter needs it 0:17:40.080 --> 0:17:42.480 to be. Um, and that's something that you know, the 0:17:42.880 --> 0:17:46.320 music business that you and I came into wasn't such 0:17:46.359 --> 0:17:49.720 a sophisticated place. I'm happy to say it's becoming more 0:17:49.760 --> 0:17:53.560 sophisticated on behalf of artists and songwriters and producers every day. 0:17:54.040 --> 0:17:56.800 So you know, there are many many good business managers 0:17:56.800 --> 0:18:00.720 and lawyers out there that have looked after clients well, 0:18:00.840 --> 0:18:03.920 certainly in the hundred and fifty odd transactions that we've 0:18:03.960 --> 0:18:08.920 made today. Okay, an iconic artist doesn't have that much 0:18:09.000 --> 0:18:13.320 runway left. Paul Simon talks about not touring anymore. He's 0:18:13.359 --> 0:18:16.400 either eighty or going to be eighty this year. Now 0:18:16.440 --> 0:18:19.280 you say, whatever the multiple is, let's just assume it's 0:18:19.359 --> 0:18:22.080 less than twenty, and you predict that you'll make the 0:18:22.119 --> 0:18:25.280 money back in ten. What is the pitch to someone 0:18:25.280 --> 0:18:30.760 who's in their thirties like Andrew Watt. So that's really 0:18:30.800 --> 0:18:34.040 about de risking that person's future. You know that if 0:18:34.080 --> 0:18:37.800 you look at Andrew Watt specifically, Andrew Watt is not 0:18:37.960 --> 0:18:42.000 only an incredible songwriter and perhaps the most important young 0:18:42.080 --> 0:18:45.560 songwriter in the world today. As I mentioned before, you know, 0:18:45.640 --> 0:18:49.000 the Grammy Award winning Producer of the Year, you know, 0:18:49.080 --> 0:18:53.120 killing it with du Olyppa, with Miley Cyrus, with Post Malone, 0:18:53.600 --> 0:18:56.280 with Ozzy Osborne. Because he's a guy that that that 0:18:56.359 --> 0:18:58.480 you know, works on music that he loves. He just 0:18:58.880 --> 0:19:01.720 doesn't just work on on on whatever is the flavor 0:19:01.720 --> 0:19:05.680 of the moment today. Um. And you know, in Andrew's case, 0:19:05.920 --> 0:19:08.639 he was a guy that was very very bright, that 0:19:08.960 --> 0:19:12.440 made an admin deal, didn't take any money for it, 0:19:12.520 --> 0:19:15.520 and just went to work and relied on himself to 0:19:16.240 --> 0:19:20.120 uh succeed in order to put money in his pocket 0:19:20.160 --> 0:19:22.200 and to pay the rent and you know, put food 0:19:22.200 --> 0:19:24.320 on his table and and and everything else that goes 0:19:24.400 --> 0:19:27.080 with it. So for someone like Andrew now at the 0:19:27.119 --> 0:19:31.359 age of thirty, his future is entirely de risked. What 0:19:31.480 --> 0:19:34.600 he works on tomorrow is his own choice because he's 0:19:34.600 --> 0:19:36.399 got enough money now to live for the rest of 0:19:36.440 --> 0:19:39.879 his life. And that's an important, you know, point of 0:19:39.960 --> 0:19:44.280 freedom for any young creator. Um so you know, it's 0:19:44.320 --> 0:19:47.159 it's it's you know you is you I think are 0:19:47.240 --> 0:19:51.640 getting to it. You know, people have different motivations for 0:19:51.640 --> 0:19:54.439 for for selling, and in his case, it's de risking 0:19:54.480 --> 0:19:58.040 his future and creating a relationship with a company like Hypnosis, 0:19:58.119 --> 0:20:01.320 because when we make these transactions, that's the beginning of 0:20:01.359 --> 0:20:04.159 the relationship. That's not the sum total of the relationship. 0:20:04.280 --> 0:20:07.160 Every one of the hundred and fifty deals that we've made, 0:20:07.240 --> 0:20:10.240 these people are now part of the Hypnosis family. They 0:20:10.280 --> 0:20:12.520 work with the eighty three people that I have around 0:20:12.560 --> 0:20:16.240 the world, and we're doing great things together. So for 0:20:16.320 --> 0:20:20.240 someone like Andrew, the prime motivation is that he's now 0:20:20.320 --> 0:20:22.919 de risked his future. But the second part of his 0:20:23.000 --> 0:20:26.160 motivation is that he now has a partner to help 0:20:26.200 --> 0:20:28.959 execute many of the things along with Scooter Braun as 0:20:29.000 --> 0:20:31.760 his manager, to execute many of the things that that 0:20:32.119 --> 0:20:35.080 are important to him in his growth as as both 0:20:35.119 --> 0:20:40.320 an artist and a producer and a songwriter. Okay, you 0:20:40.440 --> 0:20:44.520 say they're partners. What is the potential upside of an 0:20:44.560 --> 0:20:49.040 act that makes a deal with you? So every artist, 0:20:49.200 --> 0:20:51.760 without whether they ask for it or whether they don't, 0:20:52.359 --> 0:20:55.720 are going to get a minimum of two bonuses in 0:20:55.800 --> 0:20:58.520 our deals. And the reason why I have those two 0:20:58.520 --> 0:21:01.320 bonuses at the end of year three and at the 0:21:01.440 --> 0:21:04.280 end of year four is because I don't ever want 0:21:04.320 --> 0:21:09.080 anyone to have negative emotion for making a deal with me. 0:21:09.240 --> 0:21:11.639 So I'm very clear with people from the get go 0:21:11.880 --> 0:21:14.320 that I'm doing this. On the one part, you know, 0:21:14.600 --> 0:21:18.280 the motive, the motive of the fund is obviously to 0:21:18.359 --> 0:21:23.040 make money for our shareholders and for ourselves. The ulterior 0:21:23.080 --> 0:21:25.439 motive is to change where the songwriter sits in the 0:21:25.480 --> 0:21:29.320 economic equation. But as we work towards the ulterior motive, 0:21:29.720 --> 0:21:32.800 you know, the motive is something that is coming together 0:21:32.880 --> 0:21:36.480 very very quickly. And if I'm right, and streaming grows 0:21:36.560 --> 0:21:39.359 from four under the fifty million people inside of the 0:21:39.400 --> 0:21:42.520 next decade to two billion people around the world. If 0:21:42.520 --> 0:21:45.600 I'm right, in the copyright Board ruling stays in place, 0:21:45.760 --> 0:21:48.760 and there's a forty four percent increase if I'm right, 0:21:48.880 --> 0:21:51.600 and we can actively manage our catalogs better than where 0:21:51.600 --> 0:21:55.120 they came from before, and there's that growth both from 0:21:55.160 --> 0:21:58.680 a capital perspective and from a revenue perspective. I want 0:21:58.720 --> 0:22:01.720 the songwriter to participate paid in that, so I build 0:22:01.760 --> 0:22:03.960 in bonuses at the end of year three and at 0:22:03.960 --> 0:22:06.239 the end of year four that are as much as 0:22:08.040 --> 0:22:11.879 of what the purchase price was in the first place. Okay, 0:22:11.960 --> 0:22:17.119 what happens after year four? After year four, then it 0:22:17.160 --> 0:22:20.879 depends on what you know. That's a standard practice that 0:22:20.960 --> 0:22:24.159 I have for every deal that I make. If someone 0:22:24.200 --> 0:22:27.920 has negotiated something better than that after year four, then 0:22:27.960 --> 0:22:32.280 that's a different story. Okay, So some people this is 0:22:32.280 --> 0:22:37.640 a negotiable point. It's a negotiable point because, as I say, 0:22:37.680 --> 0:22:40.320 I want people to be able to participate in the 0:22:40.080 --> 0:22:44.159 in the upside um. And uh, I'd never wanted to 0:22:44.200 --> 0:22:47.040 be any negative emotion in someone, you know, I never 0:22:47.080 --> 0:22:48.880 want someone to knock on the door and say, dude, 0:22:48.880 --> 0:22:51.240 you were smarter than I was, Which is why I'm 0:22:51.320 --> 0:22:54.080 very clear with people from the get go what my 0:22:54.200 --> 0:22:58.879 thoughts are on where this business is going. Okay, now 0:22:59.240 --> 0:23:03.800 you're the big Juna, the Primary Wave is buying catalogs, 0:23:03.920 --> 0:23:08.880 Roundhill is buying catalogs. Now we saw Universal and Sony. 0:23:09.000 --> 0:23:13.359 Does everyone ultimately pay the same price or is it 0:23:13.400 --> 0:23:18.920 a bidding war? How does an act ultimately decide? Well, 0:23:19.040 --> 0:23:23.000 seventy of the of the transactions that we make are 0:23:23.320 --> 0:23:28.240 off market transactions that never involve you know, Primary Wave 0:23:28.320 --> 0:23:30.520 or round Hill or or you know any of these 0:23:30.520 --> 0:23:34.800 other companies that are are are out there. Obviously, Universal 0:23:35.480 --> 0:23:38.640 and Warner and Sony have made some deals of their own, 0:23:38.800 --> 0:23:42.720 but they're not particularly active. You can understand why if 0:23:42.720 --> 0:23:46.400 a Bob Dylan were available on the market, why Universal 0:23:46.480 --> 0:23:50.040 would do that, whereas for the most part they're not buyers. 0:23:50.400 --> 0:23:53.199 You can understand why Sony would make a deal like 0:23:53.280 --> 0:23:57.000 Paul Simon, where for the most part they're not buyers. Uh. 0:23:57.040 --> 0:24:02.080 You know, Lend Blevotnik has Tempo as a fund within Warners, 0:24:02.960 --> 0:24:06.920 But in general they seem to be buying only catalogs 0:24:06.960 --> 0:24:10.119 where they have a first or matching right on having 0:24:10.119 --> 0:24:12.960 signed an artist early enough to be able to have 0:24:13.080 --> 0:24:17.719 that built into the contract. But I I don't fear 0:24:18.080 --> 0:24:21.359 the competition in the same way that many of my 0:24:21.400 --> 0:24:25.920 competitors feel the competition because I rely on the relationship 0:24:26.000 --> 0:24:29.080 that I have with artists in the community and songwriters 0:24:29.080 --> 0:24:32.520 in the community and producers in the community that I 0:24:32.560 --> 0:24:35.520 believe in and that in turn believe in me, and 0:24:35.600 --> 0:24:37.800 that puts me in a situation where I don't have 0:24:37.880 --> 0:24:40.760 to compete, as I say, of the time and the 0:24:40.840 --> 0:24:43.320 thirty percent of the time where I am competing, if 0:24:43.359 --> 0:24:46.199 something special comes along. You know, we have people like 0:24:46.359 --> 0:24:49.280 Richie Samborra from Bon Jovi or the Risive from the 0:24:49.280 --> 0:24:52.479 Wood Tang Clan that are you know, on public record 0:24:52.520 --> 0:24:55.760 as having sold to us for less than what they 0:24:55.760 --> 0:25:00.360 were offered by competitors, because the material difference is not 0:25:01.000 --> 0:25:03.320 the size of the check, but the quality of the 0:25:03.320 --> 0:25:07.600 people that you're you know, putting your metaphorical children into 0:25:07.680 --> 0:25:10.800 the hands of you know, where I'm a I'm a 0:25:10.800 --> 0:25:14.000 good surrogate parent when it comes to music, because I care. 0:25:14.560 --> 0:25:17.000 It's not just about the money for me, It's about 0:25:17.119 --> 0:25:20.080 doing what's right for the music. And what I've certainly 0:25:20.119 --> 0:25:23.680 discovered in the almost forty years that I've been doing 0:25:23.720 --> 0:25:27.920 this is doing the right thing. Money comes to you. 0:25:28.400 --> 0:25:31.560 If you do something based on money, sometimes you'll find 0:25:31.560 --> 0:25:34.359 it very, very hard to to have that money coming 0:25:34.400 --> 0:25:37.240 to you. So you know I'm I'm someone that is 0:25:37.280 --> 0:25:40.840 always making decisions based on what's in the best interest 0:25:40.880 --> 0:25:44.000 of the music. Um. And then I have the trust 0:25:44.200 --> 0:25:47.720 in the surrender to the good man above that the 0:25:48.080 --> 0:25:51.919 money will find us. Okay, in the case of Paul 0:25:51.960 --> 0:25:54.919 Simon and Bob Dylan, did you make a bid on 0:25:55.000 --> 0:26:01.320 those catalogs on Paul Simon? No? UM On Bob Dylan, 0:26:01.560 --> 0:26:04.000 I'm under n d A. So I have to be 0:26:04.040 --> 0:26:07.440 careful about what I say, but I will say that. UM. 0:26:07.480 --> 0:26:11.440 You know, Jeff Rosen, who looks after Bob Dylan's publishing, 0:26:12.200 --> 0:26:16.520 is arguably the most underrated person in our business. He's 0:26:16.560 --> 0:26:20.320 done an unbelievable job for Bob over the years. Bob 0:26:20.359 --> 0:26:23.440 obviously has a level of faith and trust in him 0:26:23.760 --> 0:26:27.000 to allow him to execute that job. Was sometimes many 0:26:27.080 --> 0:26:30.440 artists find that difficult to do. So I I pursued 0:26:30.520 --> 0:26:34.000 Jeff and threw him Bob for the better part of 0:26:34.240 --> 0:26:37.879 eighteen months or two years to make a deal. And 0:26:37.880 --> 0:26:40.560 and uh I believe that the only discussions that he 0:26:40.680 --> 0:26:45.320 ultimately had were with Hypnosis and Universal and uh I 0:26:45.359 --> 0:26:47.200 think that the deal that he was able to make 0:26:47.800 --> 0:26:50.760 was a deal that only a company that's worth you know, 0:26:50.880 --> 0:26:53.960 thirty three and a half billion euros to fifty billion 0:26:54.080 --> 0:26:59.760 dollars could have made. Okay, do you think you helped 0:26:59.800 --> 0:27:03.439 incentivize Bob to sell or was Bob the kicking the 0:27:03.480 --> 0:27:05.760 tires on selling when you get in the picture eighteen 0:27:05.800 --> 0:27:10.440 months ago? Now, you know, I worked very hard to 0:27:10.720 --> 0:27:14.000 get uh. You know, when I talk about establishing songs 0:27:14.119 --> 0:27:18.560 as an asset class, inherent in that is that I 0:27:18.600 --> 0:27:22.359 believe that music has a value on behalf of artists 0:27:22.359 --> 0:27:26.159 and songwriters and producers, that everyone is known all along, 0:27:26.800 --> 0:27:29.960 but that the major companies and other people like Primary 0:27:29.960 --> 0:27:32.480 Waves who've been buying and selling catalogs for a long 0:27:32.560 --> 0:27:36.560 time didn't want to fully acknowledge. And I was very 0:27:36.600 --> 0:27:41.080 happy to fully acknowledge what the true value of of 0:27:41.080 --> 0:27:44.520 of of of these incredible songs are because it's in 0:27:44.560 --> 0:27:47.680 the context of explosive streaming growth and all of those 0:27:47.720 --> 0:27:50.880 other levers that I talked about. So, you know, it's 0:27:51.040 --> 0:27:55.480 very very important on the part of Hypnosis to truly 0:27:55.520 --> 0:27:59.040 recognize the value of these songs. To make sure, you know, 0:27:59.359 --> 0:28:01.720 nine point nine percent of our deals out of the 0:28:01.800 --> 0:28:04.320 hundred and fifty deals that we made A hundred and 0:28:04.359 --> 0:28:07.719 forty eight of them are directly with the songwriter, the artist, 0:28:07.880 --> 0:28:10.679 or the producer. There are only two deals that that 0:28:10.840 --> 0:28:14.359 were you know, a collection of songs that were owned 0:28:14.359 --> 0:28:17.840 by Cobalt, for example, that we've made separate and apart 0:28:17.920 --> 0:28:20.840 from that, all of our deals are made directly with 0:28:20.880 --> 0:28:24.119 the artist and the songwriter and producer because I want 0:28:24.200 --> 0:28:27.159 them to be acknowledged and I want them to be 0:28:27.200 --> 0:28:30.880 put in a position where they are their their futures 0:28:30.960 --> 0:28:33.919 de risked. Whether you're a thirty year old Andrew Watt 0:28:34.359 --> 0:28:36.879 or whether you're a seventy five year old Neil Young, 0:28:37.400 --> 0:28:41.600 I want you to be the beneficiary of of of 0:28:41.000 --> 0:28:46.000 of of the deal, not some corporation. And in doing that, 0:28:46.480 --> 0:28:50.520 I've truly do you ever talk to somebody and say 0:28:50.800 --> 0:28:52.640 you ever talk to somebody say I don't think you 0:28:52.680 --> 0:28:57.640 should sell. I tell people that almost in every instance, 0:28:57.880 --> 0:28:59.480 that I don't think that they should sell, and I 0:28:59.520 --> 0:29:01.680 tell them in exactly why I don't think that they 0:29:01.720 --> 0:29:04.680 should sell. But at the same time, I also tell 0:29:04.720 --> 0:29:07.440 them why, if they're at that place in their life 0:29:07.440 --> 0:29:10.440 where they want to sell, why I'm the right person 0:29:10.520 --> 0:29:12.680 to sell to. So you know, because you know, as 0:29:12.720 --> 0:29:16.560 you know, you can take a piece of real estate, 0:29:17.440 --> 0:29:20.800 whether it's you know, anywhere in the world London, Los Angeles, 0:29:21.040 --> 0:29:23.640 you know, and you know New York, Miami where I 0:29:23.640 --> 0:29:26.120 am at the moment, and you know, you could say 0:29:26.120 --> 0:29:27.880 to someone, look, you know, you've got to hold on 0:29:27.920 --> 0:29:30.960 to that property because twenty years from now that's going 0:29:31.000 --> 0:29:34.360 to be you know, it's something really really special, even 0:29:34.400 --> 0:29:37.160 relative to where it is right now. And of course, 0:29:37.560 --> 0:29:40.480 if if you don't have twenty years, what's the point, 0:29:40.760 --> 0:29:43.200 right It's it's so if someone's at a point in 0:29:43.200 --> 0:29:46.360 their life where they're ready to sell, then I'm the 0:29:46.440 --> 0:29:49.000 right person to sell to. If if if your music 0:29:49.080 --> 0:29:51.480 is something that I care about, then I'm the right 0:29:51.520 --> 0:29:53.560 person to sell to. If your if your music is 0:29:53.560 --> 0:29:55.920 not something that I care about, then there's a lot 0:29:55.960 --> 0:30:00.600 of other people out there. Okay, you only a hundred 0:30:00.680 --> 0:30:04.760 percent of the catalogs you buy. Now, there are there 0:30:04.800 --> 0:30:10.640 are instances where we've bought off interest of the overall catalogs. 0:30:10.720 --> 0:30:13.320 So you know, we would never go in and pick, 0:30:13.840 --> 0:30:16.200 you know, fifty songs out of a hundred. It would 0:30:16.240 --> 0:30:19.560 be buying a half interest in all one hundred songs. 0:30:19.720 --> 0:30:23.640 As an example. Um, so there are instances, you know, 0:30:23.680 --> 0:30:25.480 I would say probably out of the hundred and fifty 0:30:25.480 --> 0:30:28.560 catalogs that we own, a hundred and forty five of 0:30:28.600 --> 0:30:34.680 them are owned, and there are probably five of them 0:30:34.680 --> 0:30:38.760 where we own somewhere between fifty and seventy and in 0:30:38.920 --> 0:30:42.120 those five, and this is a minor part of your portfolio, 0:30:42.560 --> 0:30:44.880 do you have an option to buy the rest of 0:30:44.880 --> 0:30:48.240 it or is it left totally open? Correct? No, we 0:30:48.280 --> 0:30:50.440 have an option to buy the rest of it. And 0:30:50.720 --> 0:30:52.640 most of the deals that we make, even when we're 0:30:52.640 --> 0:30:56.680 buying a hundred percent of a songwriter's catalog, if there's 0:30:56.720 --> 0:31:00.360 someone that that is young and has a future, like 0:31:00.440 --> 0:31:03.320 Andrew Rott as an example, then we'll have a first 0:31:03.320 --> 0:31:08.480 and matching right on their next catalog as well. Okay, 0:31:08.520 --> 0:31:11.120 so let's soon I make a deal. You've established your 0:31:11.160 --> 0:31:16.320 bona fides. But theoretically, and I certainly hope this doesn't happen, 0:31:16.440 --> 0:31:20.560 you could die tonight, Okay, and as so could I. 0:31:21.960 --> 0:31:25.880 Are there chemian clauses or the ability to buy back 0:31:26.160 --> 0:31:34.200 or can the catalogs be transferred freely after Hypnosis purchases them? No, 0:31:34.360 --> 0:31:36.800 there are, there are There are no key man clauses 0:31:37.000 --> 0:31:39.239 and there are no abilities to buy back. But I 0:31:39.280 --> 0:31:43.320 have probably relative to other you know what, I don't 0:31:43.360 --> 0:31:46.000 allow us to be called a publishing company, where a 0:31:46.280 --> 0:31:50.960 song management company, but relative to say, companies that are 0:31:51.040 --> 0:31:56.200 called publishing companies, we probably have a higher level of 0:31:56.600 --> 0:32:02.360 people in position marketing these songs and protecting these songs 0:32:02.680 --> 0:32:06.080 than any other company in the world, including Universal Warner 0:32:06.080 --> 0:32:08.959 and Sony because the sort of executives that we have, 0:32:09.040 --> 0:32:12.680 whether it's Amy Thompson who's the chief catalog officer, or 0:32:12.720 --> 0:32:15.600 Ted Cockle who's the president, you know, these are people 0:32:15.600 --> 0:32:20.200 that are generally reserved for recorded music roles where the 0:32:20.240 --> 0:32:22.880 record company is getting the lion's share of the money, 0:32:22.960 --> 0:32:25.320 where the economics allow them to spend this kind of 0:32:25.360 --> 0:32:30.880 money on on on executives. In most publishing companies, the 0:32:30.920 --> 0:32:33.920 money is being spent on A and R executives rather 0:32:33.960 --> 0:32:37.840 than marketing people. So I've put in an incredible network 0:32:37.920 --> 0:32:40.880 of eight three plus people now that as I say, 0:32:40.920 --> 0:32:45.680 include people like Amy Thompson, Ted Cockle, Kenny McPherson, Richard 0:32:45.760 --> 0:32:50.040 Rowe that are real artist people that understand and love 0:32:50.120 --> 0:32:53.520 the music as much as I do, and that are 0:32:53.560 --> 0:32:56.840 there to to ensure that the artists and the songwriter 0:32:56.920 --> 0:33:00.160 are protected. Um, in the case that I do get 0:33:00.240 --> 0:33:03.240 hit by that proverbial bus and I'm no longer there tomorrow. 0:33:03.560 --> 0:33:06.480 And my children, who have grown up with this music 0:33:06.520 --> 0:33:09.240 and who have grown up with these artists all of 0:33:09.240 --> 0:33:12.200 their lives, are also a part of the company, and 0:33:12.240 --> 0:33:16.440 they know what my standards are, UM, and adhere to 0:33:16.520 --> 0:33:20.400 those as well. So it's it's there's probably if you know, 0:33:20.440 --> 0:33:23.760 if you'd asked me this question two years ago, UM, 0:33:23.800 --> 0:33:27.320 that was a real issue, right because obviously I hadn't 0:33:27.360 --> 0:33:30.720 made the company exciting enough yet at that point to 0:33:30.800 --> 0:33:32.920 be able to track people like Ted or Amy or 0:33:32.960 --> 0:33:35.920 Kenny or whoever it might be. Now at this point, 0:33:36.120 --> 0:33:39.400 you know, we're about to start our fourth year. UM. 0:33:39.480 --> 0:33:43.000 You know, as you very nicely said, this is the 0:33:43.040 --> 0:33:47.760 most exciting company and music perhaps today, and therefore there's 0:33:47.800 --> 0:33:53.080 no shortage of quality people that are prepared to follow 0:33:53.120 --> 0:33:57.880 in my footsteps and protect the artist if necessary. Okay, 0:33:58.040 --> 0:34:01.720 now one for you dressed earlier. I want to expand 0:34:02.880 --> 0:34:05.800 most of the money is in streaming. There's a dollar 0:34:07.040 --> 0:34:10.799 in streaming dollar of income comes in. Although Spotify is 0:34:10.840 --> 0:34:14.040 being beaten up, we all know, that's not really what's 0:34:14.040 --> 0:34:15.879 going on. They have to stay in business. They're taking 0:34:15.920 --> 0:34:21.400 approximately thirty Most people in the artist community feel of 0:34:21.480 --> 0:34:26.640 the remaining seventy cents, let's call it that the songwriter 0:34:26.719 --> 0:34:31.040 got a raw deal. Now we also know that these 0:34:31.480 --> 0:34:34.080 major at this point only three companies also have a 0:34:34.160 --> 0:34:38.759 huge footprint in songwriting and therefore, on some level they 0:34:38.800 --> 0:34:42.520 don't care where the money comes from. Is there any 0:34:42.840 --> 0:34:47.000 chance that the percentage will grow? You know, you talk 0:34:47.080 --> 0:34:49.960 about the legal with one for four, but as we 0:34:50.000 --> 0:34:53.000 go down, what's an appropriate amount of a streaming dollar 0:34:53.360 --> 0:34:55.160 that should go to the songwriter and how do we 0:34:55.200 --> 0:34:59.839 get there? Yeah, there's no question that the songwriters share 0:34:59.840 --> 0:35:01.880 of the income is going to grow. And you know, 0:35:01.960 --> 0:35:05.279 the business that you and I came into, both as 0:35:05.360 --> 0:35:09.319 fans and then as professionals was one that you know, 0:35:09.360 --> 0:35:13.520 I I affectionately referred to as the post Beatles paradigm, 0:35:13.640 --> 0:35:16.799 right where ninety percent of the artists that we would 0:35:16.840 --> 0:35:20.560 sign and work on were people that, you know, we're 0:35:20.560 --> 0:35:23.560 self contained. They you know, had a good idea of 0:35:23.560 --> 0:35:26.520 who they were, who they might become. They wrote their 0:35:26.520 --> 0:35:29.640 own songs, they knew what their album covers should look 0:35:29.680 --> 0:35:32.040 like what their stage show should look like. And the 0:35:32.120 --> 0:35:34.520 job of someone like you or I was to a 0:35:34.760 --> 0:35:37.560 believe in them and be to put a plan in 0:35:37.640 --> 0:35:40.200 place to bring their ideas to fruition and to bring 0:35:40.239 --> 0:35:44.520 them success make other people believe in them. Today the 0:35:44.600 --> 0:35:48.240 business is much more like the nineties and the nineteen fifties, 0:35:48.320 --> 0:35:51.359 where nine of the artists that are being signed are 0:35:51.440 --> 0:35:55.719 very talented people, but that are absolutely reliant on outside 0:35:55.760 --> 0:35:59.399 songwriters to deliver their heads. So, you know, I don't 0:35:59.400 --> 0:36:01.759 know if you know a statistic, but you know, we 0:36:01.760 --> 0:36:04.520 were talking about Bob Dylan a few minutes ago. It's 0:36:04.560 --> 0:36:07.080 the second of the last Bob Dylan album in two 0:36:07.080 --> 0:36:11.879 thousand and fourteen, which I think was tempest Um. That 0:36:12.560 --> 0:36:17.000 is the last album that became a Billboard Top one 0:36:17.520 --> 0:36:21.120 album of the year that didn't have an outside songwriter 0:36:21.280 --> 0:36:24.719 on it um. So the song it has never yea 0:36:24.840 --> 0:36:28.520 So the songwriter has never been more important in our 0:36:28.600 --> 0:36:32.960 lifetimes but perhaps ever in history than they are today. 0:36:33.040 --> 0:36:35.359 And you know, if you're Monty Lippmann or if you're 0:36:35.440 --> 0:36:38.840 John Janet or Rob Stringer, you know you need to 0:36:38.880 --> 0:36:43.080 have a relationship with you know, whether it's Andrew Watt 0:36:43.200 --> 0:36:47.319 or Taylor Parks or Benny Blanco or the monsters and strangers. 0:36:47.680 --> 0:36:50.399 Those relationships are more important to you today than your 0:36:50.560 --> 0:36:53.959 than your artist relationships are, because that's where the hits 0:36:53.960 --> 0:36:57.600 are coming from, is from the songwriter. But I want 0:36:57.680 --> 0:37:01.399 to to um, take up a point that you made 0:37:01.400 --> 0:37:03.560 a minute ago, which is, you know, you said they 0:37:03.560 --> 0:37:06.960 didn't care where the money was coming from. But the 0:37:07.000 --> 0:37:09.800 truth is is that they absolutely care where the money 0:37:09.880 --> 0:37:14.120 is coming from. And the reason why the songwriter is 0:37:14.160 --> 0:37:16.400 the low man or woman on the totem pole in 0:37:16.440 --> 0:37:20.040 the economic equation today is because the three biggest song 0:37:20.120 --> 0:37:24.200 companies in the world, being Universal, Warner and Sony don't 0:37:24.280 --> 0:37:29.359 advocate for songwriters, Um, you know. And it's not because 0:37:29.360 --> 0:37:32.239 they don't want to, it's because they can't because they're 0:37:32.360 --> 0:37:34.920 you know, those three biggest publishing companies in the world 0:37:35.200 --> 0:37:38.040 are owned by the three biggest recorded music companies in 0:37:38.080 --> 0:37:41.000 the world. And on the recorded music side of the business, 0:37:41.360 --> 0:37:44.279 they're getting four fifths of the revenue, they're getting an 0:37:44.320 --> 0:37:49.160 eight gross margin of forty net margin, and in general 0:37:49.480 --> 0:37:52.920 they own those master recordings in perpetuity, right is you 0:37:52.920 --> 0:37:55.720 and I know there are very few artists that actually 0:37:55.719 --> 0:37:59.600 own their own masters. Right. Conversely, on the song side 0:37:59.640 --> 0:38:01.680 of the busines this on the publishing side of the business, 0:38:02.000 --> 0:38:04.200 you've got a fifth of the revenue, you've got a 0:38:04.239 --> 0:38:07.839 fifth of the margin, and quite rightly, whether it's through 0:38:07.920 --> 0:38:11.640 good management and lawyering in the first place or reversions 0:38:11.760 --> 0:38:15.560 or renegotiations, the songs end up back in the hands 0:38:15.760 --> 0:38:19.520 of the people that co created them. So recorded music 0:38:19.960 --> 0:38:25.799 controlling publishing and stopping publishing for advocating for songwriters is 0:38:25.880 --> 0:38:29.799 why you have this unbelievable disparity. In the way that 0:38:29.880 --> 0:38:32.920 you described the dollar being split, You're right, thirty cents 0:38:32.960 --> 0:38:37.120 goes to Spotify or Apple. Now you can make an 0:38:37.239 --> 0:38:41.600 argument that that thirty cents will eventually become cents twenty 0:38:41.640 --> 0:38:44.480 four cents, and I'm quite certain it will, but that's 0:38:44.520 --> 0:38:47.799 not the material point. The material points what happens to 0:38:47.840 --> 0:38:51.320 the other seventy cents, And currently the other seventy cents 0:38:51.480 --> 0:38:53.319 is fifty eight and a half cents going to the 0:38:53.360 --> 0:38:59.640 record company. Because of their power that they wield mercilessly, 0:39:00.400 --> 0:39:04.160 they are paying most artists on a sale rather than 0:39:04.200 --> 0:39:06.640 on a license, when it actually should be a license. 0:39:07.080 --> 0:39:09.120 If it was a license, they'd be having to split 0:39:09.200 --> 0:39:11.480 that fifty eight and a half cents with them, but 0:39:11.600 --> 0:39:14.080 by paying them on a sale, they pay them about 0:39:14.160 --> 0:39:17.240 nine cents out of every dollar, So they're clearing almost 0:39:17.320 --> 0:39:22.120 fifty cents out of every dollar in recorded music. And conversely, 0:39:22.160 --> 0:39:24.600 on the song side of the business, you've got eleven 0:39:24.600 --> 0:39:27.560 and a half cents that remain. Sometimes you've got four 0:39:27.680 --> 0:39:30.239 or five six songwriters on a song. They have to 0:39:30.280 --> 0:39:33.319 split that eleven and a half cents with their publishers 0:39:33.719 --> 0:39:36.600 in some way, shape or form. So you know, these 0:39:36.640 --> 0:39:40.040 great songwriters that are delivering the songs that make the 0:39:40.040 --> 0:39:43.719 world go around are getting fractions of a penny on 0:39:43.840 --> 0:39:46.680 every dollar. And that you know, as I said at 0:39:46.719 --> 0:39:50.160 the very beginning, this has been changing. This system has 0:39:50.200 --> 0:39:53.359 been the ulterior mode of of hypnosis. The reason why 0:39:53.400 --> 0:39:57.120 I created hypnosis is that in managing people like Diane 0:39:57.160 --> 0:40:00.399 Warren and the Dream at Justin Tranter, people that we're 0:40:00.440 --> 0:40:04.200 songwriters at at the very very highest heights of success, 0:40:04.600 --> 0:40:07.400 and yet they weren't getting what they should be getting 0:40:07.880 --> 0:40:10.680 because of this system where and people will turn around 0:40:10.719 --> 0:40:12.440 to me and say, listen, you know why you blame 0:40:12.640 --> 0:40:16.719 blaming Universal Warner and Sony aren't. Isn't the way that 0:40:16.800 --> 0:40:21.160 songwriters are paid, you know, dictated by legislation, And the 0:40:21.200 --> 0:40:24.640 answer to that is absolutely, it's dictated by legislation. But 0:40:24.760 --> 0:40:29.040 how is legislation affected. It's affected by lobbying, It's affected 0:40:29.040 --> 0:40:31.520 by advocacy. So if you don't have the three biggest 0:40:31.880 --> 0:40:35.239 companies in the world advocating for songwriters and fighting for 0:40:35.280 --> 0:40:37.680 them to get paid more money, how do you expect 0:40:37.760 --> 0:40:40.960 that to be reflected in the legislation. So we're a 0:40:41.040 --> 0:40:44.759 catalyst to bring that change. I'm very, very vocal about it. 0:40:45.040 --> 0:40:47.879 As I say, it's the ulterior motive, and every one 0:40:47.920 --> 0:40:53.040 of my four ninety odd institutional investors has known from 0:40:53.160 --> 0:40:57.440 day one that this ulterior motive is the real reason 0:40:57.480 --> 0:40:59.640 why the fund was created, because I knew that if 0:40:59.680 --> 0:41:02.200 I talked to Bob Left, it's and I talked this 0:41:02.239 --> 0:41:05.600 way that you know, Universal Warner and Sony could squash 0:41:05.640 --> 0:41:08.160 me like a fly if they wanted to. But now 0:41:08.200 --> 0:41:12.040 they can't because I've a multi billion dollar company behind me, 0:41:12.480 --> 0:41:14.960 some of the finest song assets in the world, and 0:41:15.000 --> 0:41:17.799 I have a platform to speak on behalf of the 0:41:17.840 --> 0:41:21.040 songwriter and the creator um and to try and bring 0:41:21.200 --> 0:41:24.319 change and of course, the serendipity of it all is 0:41:24.360 --> 0:41:26.480 that if I can bring that change and I can 0:41:26.480 --> 0:41:29.319 get the songwriter paid more money, it's also in the 0:41:29.320 --> 0:41:32.120 best interest of my shareholders because they'll get more money 0:41:32.160 --> 0:41:35.720 for the songs that we own. And therefore they're prepared 0:41:35.760 --> 0:41:37.799 to fight and they're prepared to put their money in 0:41:38.360 --> 0:41:42.440 and you know when you've got uh, you know, investors 0:41:42.480 --> 0:41:45.520 that range from the Church of England to invest Deck, 0:41:45.920 --> 0:41:50.080 to invest Go to refer to you know, Acca and 0:41:50.200 --> 0:41:52.920 Newton and on and on and on. These are all 0:41:52.920 --> 0:41:55.120 people that that that have a lot of power in 0:41:55.120 --> 0:42:00.000 their own right. Um, so that was really the motive. Okay, 0:42:00.160 --> 0:42:03.200 let's just say, let's just say you get more for songwriters. 0:42:03.200 --> 0:42:06.000 Are you agitate for that or advocate for that? It's 0:42:06.000 --> 0:42:08.960 got to come out of the recording company's end. I mean, 0:42:08.960 --> 0:42:13.080 they're gonna really hard, you know what they've what they've done, Bob, 0:42:13.080 --> 0:42:16.000 which I think is unbelievable. You know, if you and 0:42:16.040 --> 0:42:19.239 I were having this conversation five years ago, we'd never 0:42:19.320 --> 0:42:21.480 be able to look each other in the eye and 0:42:21.600 --> 0:42:24.040 say that the best years of the music industry in 0:42:24.080 --> 0:42:26.359 front of it, right. We can say, hey, remember back 0:42:26.400 --> 0:42:29.080 in ninety nine, remember back in the year two thousand, 0:42:29.440 --> 0:42:32.000 whereas right now, you know, I can look my nineteen 0:42:32.040 --> 0:42:34.560 year old son in the eye and say you should 0:42:34.560 --> 0:42:37.800 absolutely devote yourself to music because the best years of 0:42:37.840 --> 0:42:40.239 the music industry in front of it. So, you know, 0:42:40.440 --> 0:42:44.319 Universal Warner and Sony And despite the fact that our 0:42:44.560 --> 0:42:49.160 our business has been saved by Daniel Eck and Spotify, 0:42:49.280 --> 0:42:51.800 and the way that Apple have followed and Spotify is 0:42:51.840 --> 0:42:55.480 wake um, you know, creating this very powerful one to 0:42:55.760 --> 0:42:59.560 punch and obviously lots of great regionals around the world 0:42:59.640 --> 0:43:02.320 as well. Um, you know we're making them out to 0:43:02.360 --> 0:43:04.800 be the villain, right we were? You know, we've we've 0:43:04.840 --> 0:43:08.120 just given evidence for the last four or five months 0:43:09.200 --> 0:43:12.759 in the UK in the Department of Culture, Music and 0:43:12.800 --> 0:43:17.080 Sciences hearings in Parliament, right and the if you look 0:43:17.120 --> 0:43:20.560 at our written evidence UH and also our our personal 0:43:20.600 --> 0:43:24.640 evidence are in person evidence. The hearings were originally called 0:43:25.360 --> 0:43:30.839 UH an investigation into the Business Practices of Music Streaming Services, 0:43:31.440 --> 0:43:35.880 and the first couple of sentences of our written evidence 0:43:36.000 --> 0:43:38.879 basically say, you know, look, we appreciate that you're doing 0:43:38.920 --> 0:43:42.920 these hearings into the quote unquote business practices of music 0:43:42.960 --> 0:43:46.120 streaming services. But we think what you're gonna find very 0:43:46.200 --> 0:43:48.359 very quickly, and we want to prepare you for this, 0:43:48.880 --> 0:43:51.920 is that what you're really going to be investigating is 0:43:51.960 --> 0:43:57.200 the unhealthy relationship that exists between the three major companies 0:43:57.280 --> 0:44:01.200 recorded music companies in the world, controlling three major publishing 0:44:01.200 --> 0:44:05.160 companies in the world and stopping them from advocating for songwriters. 0:44:05.560 --> 0:44:09.040 That's what stopping the songwriter from being paid properly. And 0:44:09.160 --> 0:44:11.759 the funny thing, and the most ironic thing about all 0:44:11.800 --> 0:44:14.759 of this is that if you're Big John and you're 0:44:14.840 --> 0:44:17.560 running Sony, if you're a guy Moot or Carry and 0:44:17.560 --> 0:44:22.880 you're running Warna Chapel, if you're um, excuse me, Jody 0:44:22.920 --> 0:44:26.640 and you're running Universal, you're delivering the most exciting people 0:44:26.640 --> 0:44:30.000 in your entire company's business, and yet you're not being 0:44:30.040 --> 0:44:34.359 rewarded properly for it. Right. It's it's not I'm not 0:44:34.440 --> 0:44:39.400 when I am critical of the majors. I'm not critical 0:44:39.480 --> 0:44:42.640 of the publishing companies. I think the publishing companies are 0:44:42.680 --> 0:44:45.480 doing great work. I'm not critical of the people that 0:44:45.840 --> 0:44:49.240 that work in the recorded music companies. What I'm critical 0:44:49.320 --> 0:44:51.759 of is the paradigm. There are people that work in 0:44:51.800 --> 0:44:54.960 those companies that are as passionate about music, that care 0:44:55.000 --> 0:44:57.880 as much as I do and and you do, and 0:44:57.920 --> 0:45:00.799 that do great work, but they're off parading under a 0:45:00.840 --> 0:45:04.920 seventy five year old paradigm that doesn't properly recognize the 0:45:05.000 --> 0:45:07.560 role of the songwriter. And that's why I'm intent on 0:45:07.680 --> 0:45:15.840 changing it. Let's go to the other side of the equation. 0:45:15.880 --> 0:45:20.080 You own these songs. There's administration. This is something that's 0:45:20.080 --> 0:45:24.160 been evolving in the Internet era. Cobalt was the first mover. 0:45:24.840 --> 0:45:28.919 Universal seems to have updated their systems. Let's leave Sync 0:45:28.960 --> 0:45:34.640 aside at this point in time. Who administers typnosis? So 0:45:34.760 --> 0:45:38.080 we have deals with everybody, so we we you know, Cobalts, 0:45:38.120 --> 0:45:42.239 I would say, are our preferred administrator. We believe that 0:45:42.280 --> 0:45:45.440 they collect more. We believe that they collected faster, and 0:45:45.480 --> 0:45:48.000 we believe that they pay it through faster, and we 0:45:48.080 --> 0:45:51.520 believe that they do it in a completely transparent way. 0:45:52.800 --> 0:45:57.480 But you're absolutely correct that Universal and Sony and now 0:45:57.560 --> 0:46:01.920 Warner two are all king hard to try to get 0:46:01.960 --> 0:46:06.759 to a better place, right But the difference is this 0:46:07.239 --> 0:46:10.960 is that you know, most of these big companies also 0:46:11.120 --> 0:46:14.239 operate on a two year money go around right where 0:46:14.239 --> 0:46:16.839 they collect some money in Spain and it sits there 0:46:16.880 --> 0:46:19.640 for six months, and then you know, it operates that 0:46:19.960 --> 0:46:21.799 they send the money to the UK and it sits 0:46:21.880 --> 0:46:24.520 there for another six months, and then they send it 0:46:24.560 --> 0:46:26.960 to the US and it sits there for another six months. 0:46:27.239 --> 0:46:30.000 And because most of them still only have two non 0:46:30.040 --> 0:46:33.640 transparent reporting periods a year, you know, January one to 0:46:33.719 --> 0:46:36.440 June thirty and they pay you out at September thirty, 0:46:36.560 --> 0:46:38.840 July one to December thirty one, and they pay you 0:46:38.880 --> 0:46:41.840 out at March thirty one. You know, they're basically holding 0:46:41.880 --> 0:46:44.160 onto your money for the better part of two years. 0:46:44.640 --> 0:46:48.440 And there's a great book um uh that's out this 0:46:48.480 --> 0:46:55.120 week um by will the Formumer team Spotify. Will page 0:46:55.320 --> 0:46:57.920 that you know, will tell you that, you know, if 0:46:57.960 --> 0:47:01.200 you were to take the cap it all that is 0:47:01.239 --> 0:47:04.800 being used by Universal, Warner and Sony on a daily basis, 0:47:04.840 --> 0:47:07.600 from moneys that haven't gone through, to songwriters that haven't 0:47:07.640 --> 0:47:11.080 gone through to artists, it's a massive part of of 0:47:11.200 --> 0:47:12.839 you know, it's the capital that they used to keep 0:47:12.880 --> 0:47:16.160 their businesses going and making new investments. Um And this 0:47:16.239 --> 0:47:20.800 is artists money and and songwriters money. You know, Willard 0:47:21.120 --> 0:47:25.560 ardreents at cobalt Um, I think came to the business 0:47:25.760 --> 0:47:30.680 twenty years ago with a very noble and important idea, 0:47:30.760 --> 0:47:34.840 which was to have transparency for the songwriter and the 0:47:35.040 --> 0:47:38.520 artist and to put them in a position where their 0:47:38.520 --> 0:47:41.760 money was being collected quickly, it was being paid through quickly, 0:47:42.080 --> 0:47:45.000 and that they understood every step of the way. The 0:47:45.040 --> 0:47:49.960 fact that that has now forced the major companies to 0:47:49.960 --> 0:47:53.800 try and and and at least uh go some level 0:47:53.840 --> 0:47:58.040 of of emulation, or to some degree of emulation, I 0:47:58.080 --> 0:48:03.560 think is the the artistic community and the songwriting community, 0:48:03.960 --> 0:48:06.680 Oh Willard a debt that could never ever be repaid. 0:48:07.200 --> 0:48:10.880 And certainly the spirit of Hypnosis follows very much that 0:48:11.000 --> 0:48:13.919 of Cobalt. That you know, we're forcing people to make 0:48:14.040 --> 0:48:16.640 change that they don't want to change, that that they 0:48:16.680 --> 0:48:18.560 that they don't want to make, whether they don't feel 0:48:18.560 --> 0:48:21.040 that they can make because of course people fear change 0:48:21.280 --> 0:48:24.040 right on a on a on a personal level, I 0:48:24.120 --> 0:48:26.600 like things to be the same way every day in 0:48:26.719 --> 0:48:30.120 my personal life, but in my professional life. You know, 0:48:30.280 --> 0:48:33.520 people call me a disruptor. I've never used that word myself, 0:48:33.920 --> 0:48:38.880 but I'm absolutely wanting to destroy these paradigms that have existed, 0:48:38.920 --> 0:48:40.719 and that I've put the artists at the bottom of 0:48:40.719 --> 0:48:43.080 the pile, and I want to put them take them 0:48:43.120 --> 0:48:45.400 to the top of the pile. Because without the songwriter 0:48:45.480 --> 0:48:47.759 in the artist, what do we have right if you 0:48:48.920 --> 0:48:53.920 go and see an artist. Because yeah, we made that 0:48:53.960 --> 0:48:56.319 point many times. Let's go back to administrator. You can't, 0:48:56.520 --> 0:48:59.000 but you can't. But you can't make it enough, Bob, 0:48:59.040 --> 0:49:05.120 you know the remember three rises in the past eighties, 0:49:05.120 --> 0:49:08.680 six years, Right, There's there's so much and I'll use 0:49:08.760 --> 0:49:10.360 this word and you can beep it out if you like, 0:49:10.480 --> 0:49:13.000 but there's so much fuccory in this business that you 0:49:13.080 --> 0:49:15.319 have to keep repeating the same things over and over 0:49:15.360 --> 0:49:18.120 and over again. So thank you for indulging. Those are 0:49:18.160 --> 0:49:19.880 all good points, but I want to be able to 0:49:19.920 --> 0:49:23.480 address a little bit more. So. You say that a 0:49:23.600 --> 0:49:29.200 hypnosis uses multiple administration companies, and would hypnosis ever go 0:49:29.280 --> 0:49:36.920 into the administration business? Um? You know, So we use 0:49:37.000 --> 0:49:40.959 multiple administration companies that say Cobalt is our preferred administrator. 0:49:41.239 --> 0:49:44.160 But we do great work with Sony on a daily 0:49:44.200 --> 0:49:47.840 basis on our artists and songwriters. The same thing with Universal, 0:49:47.920 --> 0:49:51.400 the same thing with Warner including Concorde as well, and 0:49:51.400 --> 0:49:54.080 and and and several others. Because of course, when we 0:49:54.160 --> 0:49:59.000 buy our catalogs, often there is no administration deal in place, 0:49:59.200 --> 0:50:02.040 so we can take over on day one. But at 0:50:02.080 --> 0:50:04.879 other times there's a year left on the administration, there's 0:50:04.880 --> 0:50:07.759 two years left on the administration. We've even bought some 0:50:07.840 --> 0:50:12.760 catalogs where the administration is is perpetual with a particular company. 0:50:12.840 --> 0:50:15.480 And I think that you know, you you talked about 0:50:15.560 --> 0:50:18.560 universal um, you know, kind of stepping up to the 0:50:18.560 --> 0:50:21.600 plate as far as emulating Cobalt or or or doing 0:50:21.640 --> 0:50:24.239 something that's forward thinking. But I think that you can 0:50:24.280 --> 0:50:28.359 give Sony a lot of credit on that front as well. UM. 0:50:28.480 --> 0:50:30.959 And I think that that that now with Guy Mood 0:50:30.960 --> 0:50:32.799 at Warner Chapel, I think he's gonna want to do 0:50:32.840 --> 0:50:35.000 the same thing. So you know, I have high hopes 0:50:35.200 --> 0:50:37.200 that that all of them will want to do the 0:50:37.239 --> 0:50:40.920 same thing. I'm I'm in the asset business, so you know, 0:50:40.960 --> 0:50:45.040 from that point of view, I believe that my investors 0:50:45.080 --> 0:50:51.279 money should go into buying great songs, um. And that 0:50:51.400 --> 0:50:54.640 you know, you can rent these services from people. But 0:50:54.719 --> 0:50:57.840 as we approach you know what is now, you know, 0:50:57.960 --> 0:51:01.280 two point five billion dollars in did and I expect 0:51:01.320 --> 0:51:03.759 that by the end of the next two years will 0:51:03.800 --> 0:51:07.040 be about six billion dollars invested. It might be in 0:51:07.080 --> 0:51:11.600 the best interest of our shareholders to have an administration 0:51:11.680 --> 0:51:15.760 company UM and that's something that that will continue to 0:51:15.400 --> 0:51:18.239 to keep an eye on. But you know that, to 0:51:18.320 --> 0:51:21.040 me is not the priority. The priority is to to 0:51:21.400 --> 0:51:24.960 stay very focused on buying these great songs while they're 0:51:25.000 --> 0:51:28.759 there to buy. Okay, let's talk about you specifically, Mark. 0:51:29.480 --> 0:51:31.799 Where did you grow up, What did your parents do 0:51:31.920 --> 0:51:34.239 for a living, how many kids in the family, what 0:51:34.320 --> 0:51:39.160 was your adolescents like? Um So I was born in 0:51:39.239 --> 0:51:43.200 a mining town in Quebec that doesn't exist anymore. When 0:51:43.239 --> 0:51:45.440 the when the mind dried up, the people dried up. 0:51:45.480 --> 0:51:48.720 To um So, I ended up being raised in Nova Scotia. 0:51:48.800 --> 0:51:53.040 My parents were Greek immigrants to to Toronto in the 0:51:53.120 --> 0:51:56.680 nineteen fifties. Before I was born, my father had been 0:51:56.680 --> 0:51:59.840 a soccer player in Greece for a team called Pouk 0:52:00.520 --> 0:52:03.440 and he was brought to Canada to play soccer for 0:52:03.520 --> 0:52:06.319 a team called the Toronto Star, which is the sort 0:52:06.360 --> 0:52:11.200 of forefather of the Toronto MLS team today. Um and 0:52:11.600 --> 0:52:14.640 his brother was a topographer for the iron Ore company. 0:52:14.640 --> 0:52:18.120 Of Canada. So when he retired from soccer, he went 0:52:18.160 --> 0:52:21.759 to work with his brother. In those days, you know, 0:52:21.800 --> 0:52:26.200 the brother was was responsible for designing the infrastructure that 0:52:26.239 --> 0:52:29.799 the miners would would need to live and do their job. 0:52:30.239 --> 0:52:33.040 And there were opportunities, whether it was building restaurants or 0:52:33.560 --> 0:52:36.960 schools or or whatever the case might be. When all 0:52:37.000 --> 0:52:39.719 that dried up, we moved to Nova Scotia, and I 0:52:39.760 --> 0:52:44.080 had this very idyllic childhood in Nova Scotia. But I 0:52:44.160 --> 0:52:46.320 was very very lucky. I've got I've got a sister 0:52:47.480 --> 0:52:52.120 who's still in Toronto today, and and uh, she's lovely 0:52:52.160 --> 0:52:55.480 and everything. But you know, when we were kids, we 0:52:55.480 --> 0:52:59.160 didn't see eye to eye on on on just about anything. 0:52:59.280 --> 0:53:02.080 Right if was black, you know, she loved the Boston Bruins. 0:53:02.320 --> 0:53:05.120 I loved the Montreal Canadians. She loved which one of 0:53:05.160 --> 0:53:09.200 you is older. She's one year older than I am. 0:53:09.280 --> 0:53:12.640 So I had this very serendipitous thing happened to me though, 0:53:12.680 --> 0:53:18.239 which is that my eldest cousin, my father's brother's eldest son, 0:53:18.440 --> 0:53:21.360 who was about ten years older than I was. Um, 0:53:21.440 --> 0:53:24.399 he got in trouble in Greece because Greece was under 0:53:24.400 --> 0:53:28.080 a military junta. And if you were you know, fourteen 0:53:28.160 --> 0:53:30.480 or fifteen years old and you were smoking dope and 0:53:30.480 --> 0:53:34.560 and and you know, listening to music um and wearing 0:53:34.640 --> 0:53:37.680 peace signs that the Greeks believed were like a broken crucifix, 0:53:38.160 --> 0:53:41.400 you were you were a target for for the military. 0:53:41.520 --> 0:53:45.960 So my uncle sent my older cousin, Mike to live 0:53:46.000 --> 0:53:50.000 with us. And this guy arrived with long hair. He 0:53:50.160 --> 0:53:54.920 arrived with argust by wishbone Ash. He arrived with the 0:53:54.960 --> 0:53:57.840 first two Fleetwood Mac records that the Peter Green Ones. 0:53:58.239 --> 0:54:01.719 He arrived with Paranoid by Black Sabbath, super fled by 0:54:01.719 --> 0:54:06.640 Curtis Mayfield, t for the Tillerman Uh, just about you know, 0:54:06.760 --> 0:54:10.160 fourteen or fifteen albums that are still amongst the fourteen 0:54:10.239 --> 0:54:13.360 or fifteen albums that are the most important in my life. 0:54:13.920 --> 0:54:16.880 And he knew everything about drugs, and he knew everything 0:54:16.880 --> 0:54:20.440 about girls, and he was someone to aspire to be 0:54:20.440 --> 0:54:23.640 because he also knew an awful lot about music. And 0:54:23.719 --> 0:54:26.200 that really kind of put me on the path that 0:54:26.640 --> 0:54:29.800 you know, I'm still on today, and I'm still influenced by, 0:54:29.920 --> 0:54:32.440 as I say, those those fourteen or fifteen records that 0:54:32.480 --> 0:54:35.239 he had, and we would sit in in the room 0:54:35.320 --> 0:54:37.520 that my parents had constructed for him, and we had 0:54:37.520 --> 0:54:40.799 one of those you know, dropped down turntables where you'd 0:54:40.840 --> 0:54:43.239 stack the records up and they dropped one at a 0:54:43.280 --> 0:54:45.839 time and play through, and then you turn them all 0:54:45.880 --> 0:54:48.759 over and play them through. And I fell in love 0:54:48.800 --> 0:54:54.040 with this idea of twenty minutes of music and then 0:54:54.480 --> 0:54:57.520 instead of wanting to hear the next twenty minutes of music, 0:54:57.840 --> 0:55:00.839 you'd want to play that same side over and over 0:55:00.880 --> 0:55:04.280 and over again because it was so magical. Um. And 0:55:04.560 --> 0:55:06.680 you know, he arrived, he gave me a present for 0:55:06.760 --> 0:55:09.840 the first birthday that that I had with him there, 0:55:09.920 --> 0:55:12.920 which was a copy of Sergeant Pepper's And then that 0:55:13.040 --> 0:55:17.120 got me into a place of spending every penny that 0:55:17.200 --> 0:55:20.680 I had on on records. So very soon after I 0:55:20.719 --> 0:55:23.759 bought my own tea for the Tillerman. Very soon after that, 0:55:23.880 --> 0:55:27.239 I bought Harvest, uh. And these records, you know, a 0:55:27.320 --> 0:55:31.560 small town of of of two thousand people, these records 0:55:31.719 --> 0:55:35.040 really start to teach you that there's something else that's 0:55:35.040 --> 0:55:37.799 going on in the world, uh, that's not going on 0:55:37.880 --> 0:55:42.040 in your world. And then concurrently with that, my parents 0:55:42.080 --> 0:55:44.080 one of the restaurants that they had was a diner, 0:55:44.640 --> 0:55:47.480 and the diner had a jukebox in it, and that 0:55:47.600 --> 0:55:52.319 jukebox had everything from Elvis Presley singing mac Davis's song 0:55:52.400 --> 0:55:55.400 in the Ghetto to you know, looking out by My 0:55:55.480 --> 0:55:58.799 back Door by CCR. And again, these records had a 0:55:58.800 --> 0:56:01.640 massive effect on these So you know, I can very 0:56:01.719 --> 0:56:05.960 distinctly remember In the Ghetto as being the first record 0:56:06.000 --> 0:56:08.600 that I ever heard that made me sad, and that 0:56:08.800 --> 0:56:12.800 made me realize that in fact, everyone's world wasn't perfect 0:56:13.239 --> 0:56:15.799 in the way that my world seemed to be perfect. So, 0:56:15.960 --> 0:56:18.480 if you like, it was my first kind of real 0:56:19.040 --> 0:56:23.520 experience of empathy brought up by mac Davis's great words 0:56:23.560 --> 0:56:27.160 and Elvis is great delivery. And you know, I suddenly 0:56:27.200 --> 0:56:29.560 realized that I was going to the school of Neil Young, 0:56:29.640 --> 0:56:32.239 and going to the school of Lou Reid and led 0:56:32.320 --> 0:56:36.239 Zeppelin and Patti Smith and eventually the Clash, and you know, 0:56:36.680 --> 0:56:39.560 these these are are the people that kind of educated 0:56:39.600 --> 0:56:42.520 me and prepared me for a world. I can remember 0:56:42.840 --> 0:56:46.200 playing needle in the damage done by Neil Young and 0:56:46.239 --> 0:56:49.600 having nightmares that I was taking heroin and waking up 0:56:49.600 --> 0:56:51.680 in in the morning and kind of looking at my 0:56:51.800 --> 0:56:53.879 risks to see whether or not they were really track 0:56:54.000 --> 0:56:58.120 marks there. Um. So the music had an unbelievably profound 0:56:58.320 --> 0:57:02.080 effect on me. And you know, you you, I think 0:57:02.120 --> 0:57:05.440 when you write your best is when you write about Elton, 0:57:06.160 --> 0:57:09.879 and uh, when you write at your best is when 0:57:09.920 --> 0:57:13.200 you're writing it Elton about Elton. And and those Alton 0:57:13.280 --> 0:57:16.760 records had the same effect on me, particularly a little 0:57:16.760 --> 0:57:18.960 bit later than than the ones that you rave about, 0:57:18.960 --> 0:57:22.880 but particularly Captain Fantastic and someone saved my life tonight. 0:57:22.960 --> 0:57:26.200 Those those are you unbelievably important records for me. So 0:57:26.680 --> 0:57:31.240 they gave me the ability to manifest how the funk 0:57:31.280 --> 0:57:33.680 to get out of this town with two thousand people 0:57:33.720 --> 0:57:36.880 in it and go on to manage Elton John was 0:57:37.120 --> 0:57:40.840 all based on on that obsession with this music and 0:57:41.320 --> 0:57:46.040 recognizing that that, uh uh, there was something for me 0:57:46.120 --> 0:57:50.120 to do because you know I talked about Elliott Roberts earlier. Um, 0:57:50.160 --> 0:57:53.360 I was very clear from the time I was seven 0:57:53.640 --> 0:57:56.480 or eight years old that I had no musical talent 0:57:56.560 --> 0:57:58.840 and that I was never gonna be you know, Neil 0:57:58.920 --> 0:58:02.040 Young or Jimmy Page or Robert Plant. So I started 0:58:02.040 --> 0:58:05.720 to read about these people in everything from Rolling Stone 0:58:05.760 --> 0:58:09.240 to Cream to whatever the library had, and I started 0:58:09.280 --> 0:58:11.520 to learn about people like Elliott, and I started to 0:58:11.560 --> 0:58:15.200 learn about people like Peter Grant, and suddenly there were 0:58:15.480 --> 0:58:18.480 you know, kind of role models there for me that 0:58:18.840 --> 0:58:21.080 you know, I believed that I could emulate. I I 0:58:21.200 --> 0:58:25.520 got the real message that, uh, you know, people that 0:58:25.560 --> 0:58:27.960 were making music wanted to make music, and that other 0:58:28.000 --> 0:58:30.880 people had to come along and protect them and make 0:58:30.920 --> 0:58:34.000 sure that that, you know, the commerce was maximized with 0:58:34.080 --> 0:58:39.640 the art not being compromised. Okay, so you graduate from 0:58:39.680 --> 0:58:41.600 high school, what's your next step? How do you get 0:58:41.600 --> 0:58:47.080 out of Nova Scotia? Um? I literally ran away, Uh 0:58:47.320 --> 0:58:51.200 you know, I ended up in in in Uh you know, 0:58:51.240 --> 0:58:55.840 I've been writing letters to Simon Draper at Virgin Records 0:58:55.920 --> 0:58:58.720 in the UK. And and for for those that don't know, 0:58:59.280 --> 0:59:03.920 Simon was Richard's Richard Branson's cousin, and he was the 0:59:03.960 --> 0:59:08.320 guy that that uh you know, really was the musical 0:59:08.680 --> 0:59:12.400 brains behind the company. So you know, he had signed 0:59:12.600 --> 0:59:15.400 Tangerine Dream, he had signed My Goldfield, he had signed 0:59:15.440 --> 0:59:19.480 Robert Wyatt. But then of course subsequently everyone from the 0:59:19.520 --> 0:59:22.920 Sex Pistols to XTC two Simple Minds to You Be 0:59:23.080 --> 0:59:27.200 forty two. Uh you know the Human League, Peter Gabriel, 0:59:27.560 --> 0:59:30.600 you know, Orchestral Maneuvers in the dock you beforety On 0:59:30.640 --> 0:59:34.160 and on and on. So this amazing thing happened where 0:59:34.360 --> 0:59:37.960 I find myself working for Virgin Records, still in my teens, 0:59:38.880 --> 0:59:42.080 a little bit, a little bit slower. How do you 0:59:42.120 --> 0:59:45.840 write these letters? How do you literally get a job 0:59:45.840 --> 0:59:48.760 at Virgin Records? How old are you? And we're and 0:59:48.840 --> 0:59:52.840 what is the job? So I'm making I go to 0:59:52.840 --> 0:59:58.200 Toronto and I get a job for six months thanks 0:59:58.240 --> 1:00:01.040 to a girlfriend that I had, were king for the 1:00:01.080 --> 1:00:07.080 Canadian UH distributor of Motown. And before I got that job, 1:00:07.720 --> 1:00:12.400 I knew that Virgin was opening and they were going 1:00:12.440 --> 1:00:15.200 to open as a standalone label, and I went and 1:00:15.240 --> 1:00:17.160 met with the guy that was going to run it, 1:00:17.440 --> 1:00:20.960 and he offered me the job to be the marketing person, 1:00:21.080 --> 1:00:24.920 the one and only marketing person at Verga Records at 1:00:24.960 --> 1:00:28.760 that point. And but the company was gonna open for 1:00:28.800 --> 1:00:32.520 six months. So for that six month period, I got 1:00:32.560 --> 1:00:37.280 this job working for the Canadian distributor of Motown and 1:00:37.360 --> 1:00:40.120 which was a company called Quality Records and run by 1:00:40.240 --> 1:00:44.560 this magical guy called George Street and UH, a guy 1:00:44.640 --> 1:00:49.240 called UH Larry McCrae and Cameron Carpenter, who I know 1:00:49.640 --> 1:00:52.200 you you know quite well, and of course in Canada, 1:00:52.720 --> 1:00:55.200 and that that kind of became my little gang for 1:00:55.240 --> 1:00:59.800 this six month period. And the funny thing about this 1:01:00.120 --> 1:01:04.920 that within days of me starting the company took on 1:01:04.960 --> 1:01:10.200 a distribution deal with Clive Calder's then brand new Jive Records. 1:01:10.800 --> 1:01:15.440 And Uh, the guy that UH was the Jive person, 1:01:15.760 --> 1:01:19.000 the young Jive person in the same way that I 1:01:19.040 --> 1:01:23.400 was the young Quality Records person, was Barry Weiss. So 1:01:23.520 --> 1:01:25.800 the first phone call that we ever had, the first 1:01:25.840 --> 1:01:28.080 phone call I ever made, was to Barry Weiss. The 1:01:28.120 --> 1:01:30.920 first phone called Barry Weiss ever made, you know, in 1:01:31.040 --> 1:01:33.160 terms of being in the music business, was to me 1:01:33.760 --> 1:01:36.800 to talk about a band called the Compsat Angels that 1:01:36.920 --> 1:01:39.760 we both loved, that had been on poly Door and 1:01:39.800 --> 1:01:42.960 had a rough time and had now signed to Jive 1:01:43.040 --> 1:01:46.480 and were affectionately known as the cs Angels because the 1:01:46.520 --> 1:01:50.280 Compsat Satellite Company was taking action against them not to 1:01:50.400 --> 1:01:52.960 use the name. Um. So I was there for six 1:01:53.000 --> 1:01:56.080 months and then I went immediately to Virgin Records and 1:01:56.240 --> 1:01:59.200 started to work for Virgin Records, and I developed my 1:01:59.280 --> 1:02:02.560 relationship with Simple Minds, and I developed my relationship with 1:02:02.960 --> 1:02:05.680 Orchestral Maneuvers in the Dark and with the Human League, 1:02:05.720 --> 1:02:08.520 and you know, with all these wonderful artists. Because Virgin 1:02:08.600 --> 1:02:13.320 had this serendipitous situation where even though they were making 1:02:13.440 --> 1:02:17.000 left of center you know, what was known as alternative music, 1:02:17.680 --> 1:02:21.840 it was succeeding commercially in wild ways, you know, culture Club. 1:02:22.200 --> 1:02:25.160 We're becoming the biggest band in the world. Simple Minds 1:02:25.160 --> 1:02:27.680 were soon to follow suit. Um, and that was my 1:02:27.800 --> 1:02:31.080 big passion project and remains one of my great passions 1:02:31.080 --> 1:02:34.000 to today. Um. Same thing with O. M. D. And 1:02:34.040 --> 1:02:36.480 same thing with you Be forty, who had massive success 1:02:36.800 --> 1:02:42.160 with Red Red Wine. And I was young and unsophisticated, 1:02:42.800 --> 1:02:47.840 and I didn't realize that, uh, I wasn't working for 1:02:47.880 --> 1:02:52.640 the artist, right I because Virgin was the most artist 1:02:52.720 --> 1:02:56.400 friendly record company. I honestly thought that I was working 1:02:56.440 --> 1:03:00.840 for the artist, not for the for someone else. And um, 1:03:00.880 --> 1:03:04.160 what happened was that they rewarded my success at the 1:03:04.240 --> 1:03:07.680 label by allowing me to be a part of signing 1:03:08.520 --> 1:03:11.280 one of the most wonderful Canadian artists of all time, 1:03:11.800 --> 1:03:14.520 someone that I would still rank even though she's never 1:03:14.560 --> 1:03:18.560 had the career that she deserved, alongside Neil Young and 1:03:18.680 --> 1:03:22.120 Joni Mitchell and Robbie Robertson and Leonard cone Is you 1:03:22.160 --> 1:03:27.960 know in the Weekend and Drake is Canada's greatest products. Um. 1:03:27.960 --> 1:03:31.240 It was a girl called Mary Margaret O'Hara, and she 1:03:31.400 --> 1:03:35.800 was Catherine O'Hara's little sister, and she was unbelievably special. 1:03:36.400 --> 1:03:41.320 And uh, you know, we got Andy Partridge from XTC 1:03:41.760 --> 1:03:45.960 to agree to make her record. And even though Andy 1:03:46.320 --> 1:03:50.640 was a wonderful artist in the form of XTC, he 1:03:50.720 --> 1:03:54.240 wasn't a wonderful producer, and he wasn't someone that was 1:03:54.280 --> 1:03:58.640 prepared to recognize that in the producer's role, that his 1:03:58.760 --> 1:04:02.280 job was to be there to serve Mary Margaret and 1:04:02.320 --> 1:04:04.720 to help her make the best record that she wanted 1:04:04.760 --> 1:04:08.320 to make possible. So there were all kinds of problems 1:04:09.200 --> 1:04:11.640 from the get go in the making of that record. 1:04:11.680 --> 1:04:14.440 And even though the record eventually came out three or 1:04:14.440 --> 1:04:16.920 four years later as a record called Miss America and 1:04:16.960 --> 1:04:19.320 won a lot of awards and was the album of 1:04:19.320 --> 1:04:22.800 the Year, the actual making of the record was a 1:04:22.920 --> 1:04:27.400 very very painful experience. And I recognized at that point 1:04:27.480 --> 1:04:30.600 that for the first time, suddenly the light bulb went off, 1:04:30.640 --> 1:04:34.160 and I found myself in a position where I wanted 1:04:34.200 --> 1:04:36.880 to be on Mary's side rather than on the record 1:04:36.920 --> 1:04:41.240 company's side. And at that point I became a manager, 1:04:41.840 --> 1:04:45.840 and uh, they were probably gonna fire me anyways, because 1:04:46.360 --> 1:04:48.800 it was very clear that I was on on on 1:04:48.800 --> 1:04:52.480 on Mary's side and the company had new leadership, and 1:04:52.480 --> 1:04:56.720 and uh, you know, probably wasn't gonna work out. But 1:04:56.800 --> 1:05:00.960 I basically went to two guys in and that I 1:05:01.000 --> 1:05:03.480 had a relationship with a guy called Rod Smallwood who 1:05:03.520 --> 1:05:05.640 you know, and a guy called Andy Taylor, who you know. 1:05:06.160 --> 1:05:08.840 And I said, listen, I've had this epiphany. I'm not 1:05:08.880 --> 1:05:10.960 supposed to work for a record company. I'm supposed to 1:05:11.000 --> 1:05:13.200 work for the artist. I'm supposed to be a manager. 1:05:13.800 --> 1:05:16.440 And Rod and Andy said, you're right, and you know, 1:05:16.600 --> 1:05:19.440 you should come in with us. They were both fifteen 1:05:19.480 --> 1:05:23.479 years older than I was, and they were looking. Yeah, 1:05:23.520 --> 1:05:26.760 I worked at Sanctuary of course in the eighties, very 1:05:26.760 --> 1:05:29.880 different the one you worked for. But how did you 1:05:30.000 --> 1:05:34.240 know Rodd Andy Andy to throw in with them? Because 1:05:34.280 --> 1:05:37.120 I was a fan of Iron Maidens, and I was 1:05:37.200 --> 1:05:41.960 particularly a fan of the way that Rod acted on 1:05:42.080 --> 1:05:46.200 behalf of Iron Maiden and protected the band. And I 1:05:46.320 --> 1:05:50.160 knew that, you know that that he was one a 1:05:50.320 --> 1:05:55.120 role model that uh, you know, you could certainly do 1:05:55.160 --> 1:05:58.280 a lot worse than too. And you know the great 1:05:58.280 --> 1:06:01.600 thing about these two guys, you know, I'm you already 1:06:01.640 --> 1:06:05.200 know this, but I'll tell it for everyone else that 1:06:05.280 --> 1:06:08.640 doesn't is that you know, they were best friends. But 1:06:08.720 --> 1:06:11.360 they couldn't be more different from each other. Right, one 1:06:11.400 --> 1:06:15.160 of them was completely business the other was completely creative. 1:06:15.600 --> 1:06:18.440 One of them hated sports, the other one loved sports. 1:06:19.000 --> 1:06:20.800 The only thing that they had in common was that 1:06:20.840 --> 1:06:25.480 they loved drinking, right, and they loved Iron Maiden, and uh, 1:06:25.640 --> 1:06:28.520 I became the bastard offspring of the two of them. I. 1:06:28.680 --> 1:06:31.840 I took what Andy knew about business and I absorbed 1:06:31.880 --> 1:06:36.280 it all. I took what Rod knew about integrity and 1:06:36.400 --> 1:06:41.959 about creativity and you know, protecting people in fairness, and 1:06:42.400 --> 1:06:44.840 I absorbed all of that as well. And I became, 1:06:44.920 --> 1:06:48.760 as I said, I'm very proud to be the bastard 1:06:48.800 --> 1:06:51.400 offspring of of of the two of them. And I've 1:06:51.440 --> 1:06:56.200 certainly built a career on the back of lessons that 1:06:56.280 --> 1:06:59.160 they taught me. And there was another guy that was very, 1:06:59.240 --> 1:07:02.960 very important in this even before Rod Nandy, and that 1:07:03.000 --> 1:07:06.840 was a guy called Bruce Finley from Edinburgh in Scotland 1:07:07.160 --> 1:07:12.080 who managed Simple Minds. And this guy very very similarly 1:07:12.120 --> 1:07:15.800 to Rod Smallwood. He understood that your job was to 1:07:16.120 --> 1:07:19.880 go out and create as much enthusiasm for your artists 1:07:19.960 --> 1:07:23.720 music as possible and get the troops on your side 1:07:23.760 --> 1:07:26.000 and get them working, and get them in love with 1:07:26.040 --> 1:07:28.560 the band your band as much as you're in love 1:07:28.600 --> 1:07:31.560 with your band. And he taught me a tremendous amount 1:07:31.600 --> 1:07:35.200 as well. And those those three guys, along with Elliott Roberts, 1:07:35.720 --> 1:07:38.200 are are you know, the people that I consider to 1:07:38.240 --> 1:07:42.959 be my mentors. Okay, a couple of questions here, Hey, 1:07:43.000 --> 1:07:46.960 what year did you start working for Sanctuary be the 1:07:47.080 --> 1:07:49.920 company ultimately goes public, can you tell us the insight 1:07:49.960 --> 1:07:52.680 and how that happened and see how did you essentially 1:07:52.760 --> 1:07:57.960 end up running it? Sure? So, so the the uh, 1:07:58.000 --> 1:08:04.000 this is probably eighty six and probably the better part 1:08:04.040 --> 1:08:08.680 of of UM five or six years later, you know, 1:08:10.320 --> 1:08:13.880 were iron Maidens Management Company right when the when the 1:08:13.920 --> 1:08:18.439 company ends in two thousand and six or so, we're 1:08:18.439 --> 1:08:22.240 still iron Maidens Management Company, but we go from being 1:08:22.280 --> 1:08:26.439 iron Maidens Management Company to eventually being out John's management 1:08:26.479 --> 1:08:31.280 company and Guns and Roses management company, Beyonce's management company, 1:08:31.320 --> 1:08:35.240 with me driving all of those artists. UM. And the 1:08:35.280 --> 1:08:39.080 way that it happened was that we recognized in the 1:08:39.120 --> 1:08:45.320 early nineties, UM, when Uh Polli Graham became a company 1:08:45.360 --> 1:08:50.880 called p l G. That was the first real consolidation 1:08:51.760 --> 1:08:55.840 of a major record company where they went from effectively 1:08:55.880 --> 1:08:59.640 having four companies to basically having four A and R 1:08:59.720 --> 1:09:03.679 sent ters with a common marketing department and a common 1:09:03.720 --> 1:09:08.040 promotion department. That this was going to disenfranchise many artists 1:09:08.120 --> 1:09:11.000 because you know, if you were one of the artists 1:09:11.040 --> 1:09:13.920 that was selling ten million records around the world, you 1:09:14.000 --> 1:09:16.920 were going to get a lot of attention because of that. 1:09:17.040 --> 1:09:19.000 But if you were an artist that was going to 1:09:19.080 --> 1:09:21.720 sell a million records around the world, that was no 1:09:21.800 --> 1:09:26.160 longer interesting, believe it or not, you know, knowing what 1:09:26.240 --> 1:09:28.479 we know about what happened between two thousand and one 1:09:28.520 --> 1:09:31.200 and two thousand and sixteen, there's a point in the 1:09:31.280 --> 1:09:33.840 nineties where being able to sell a million copies around 1:09:33.880 --> 1:09:36.680 the world is not interesting to the major record companies. 1:09:37.200 --> 1:09:39.680 And we knew that this was going to disenfranchise a 1:09:39.680 --> 1:09:42.960 lot of artists, and it would particularly disenfranchise a lot 1:09:43.000 --> 1:09:45.479 of artists in the hard rock world. That that that 1:09:45.520 --> 1:09:48.160 we had a lot of expertise in, whether that was 1:09:48.200 --> 1:09:51.040 a Mega Death or a Slayer or whoever it might be. 1:09:51.520 --> 1:09:54.360 And we wanted to be prepared to be able to 1:09:54.400 --> 1:09:58.400 service those artists better than the big companies. So, you know, 1:09:58.479 --> 1:10:02.320 we created an independ the record company that became the 1:10:02.360 --> 1:10:05.360 biggest independent record company in the world and that worked 1:10:05.360 --> 1:10:10.920 with everyone from you know Morrissey to Megadeth to you 1:10:10.960 --> 1:10:15.160 know Ossy and and and Osborne and Kelly Osborne and 1:10:15.479 --> 1:10:18.519 many many others um and became very much best in 1:10:18.600 --> 1:10:21.760 class for its period. We had the biggest booking agency 1:10:21.960 --> 1:10:26.799 outside of North America that was Helter Skelter that booked 1:10:26.840 --> 1:10:30.400 everyone from from Metallica through to a C d C 1:10:30.800 --> 1:10:33.479 as well as Iron Maiden. And the idea was we 1:10:33.640 --> 1:10:39.040 built a real three sixty company, Bravado Merchandizing that you know, 1:10:39.120 --> 1:10:43.000 merchandised everyone from the Spice Girls to the Red Hot 1:10:43.040 --> 1:10:47.040 Chili Peppers to Iron Maiden. Um. You know, we built 1:10:47.040 --> 1:10:51.000 a company that could provide services to all of these 1:10:51.000 --> 1:10:54.600 wonderful artists on a three hundred and sixty degree basis. 1:10:55.120 --> 1:10:59.080 But my vision of three sixty was very, very different 1:10:59.240 --> 1:11:03.680 from the modern record companies version of three sixty. My 1:11:03.880 --> 1:11:05.920 version of three sixty was, look, we're going to make 1:11:05.920 --> 1:11:09.760 a capital investment in this artist. In order to get 1:11:09.760 --> 1:11:12.360 that capital investment back, we need to have as many 1:11:12.400 --> 1:11:16.599 income streams as possible. But within each of those income streams, 1:11:16.920 --> 1:11:20.040 we're going to give the artist the best deal possible 1:11:20.520 --> 1:11:22.439 and will be based on what the market is being 1:11:23.240 --> 1:11:26.080 is prepared to pay for that artist. And the company, 1:11:26.120 --> 1:11:28.759 as you know, was wildly successful for a long period 1:11:28.760 --> 1:11:32.760 of time. It went public and then you know what 1:11:32.880 --> 1:11:36.080 happened was that as you get from two thousand and 1:11:36.120 --> 1:11:40.639 five into two thousand and six, the company was the 1:11:40.680 --> 1:11:45.320 first major company to feel the effect of the bottom 1:11:45.360 --> 1:11:49.160 falling out of the record business because people were now 1:11:49.320 --> 1:11:53.800 able to download their music for free illegally rather than 1:11:53.840 --> 1:11:58.920 to pay for it. And we were too big, um, 1:11:58.960 --> 1:12:00.960 you know, we were in that period of time where 1:12:01.080 --> 1:12:04.479 we weren't small enough to be able to make changes quickly, 1:12:05.160 --> 1:12:09.639 and the effect on the company was disastrous. And also 1:12:09.680 --> 1:12:13.000 the company didn't have the level of sophistication that it 1:12:13.040 --> 1:12:15.960 should have with the stock market and its dealings. With 1:12:16.000 --> 1:12:19.840 the stock market, and effectively what happened was that, you know, 1:12:20.640 --> 1:12:25.080 after seven years of year on year growth, instead of 1:12:25.120 --> 1:12:28.120 the company going to the stock market and saying, look, 1:12:28.160 --> 1:12:31.240 that type of growth isn't possible right now, illegal downloading 1:12:31.320 --> 1:12:34.240 is killing the music business. But we've got these amazing 1:12:34.360 --> 1:12:37.280 artists like Elton John and Beyonce and Guns and Roses 1:12:37.320 --> 1:12:41.080 and Morrissey and many many others, UM, and what you 1:12:41.120 --> 1:12:42.599 need to do is you need to let us batten 1:12:42.640 --> 1:12:45.400 down the hatches and get to a point where we 1:12:45.520 --> 1:12:48.120 ride this out and then we'll be back for you. 1:12:48.479 --> 1:12:52.360 And instead, more growth was promised and the company wasn't 1:12:52.360 --> 1:12:54.880 able to sustain itself, so it was sold to Universal. 1:12:55.640 --> 1:13:01.680 That becomes a very very important UH lesson learned in 1:13:02.040 --> 1:13:07.400 the UH way that then Hypnosis gets launched. Because when 1:13:07.400 --> 1:13:12.080 I launched Hypnosis, I ensured that I had a level 1:13:12.080 --> 1:13:15.599 of sophistication and a level of advice at the very 1:13:15.680 --> 1:13:20.720 very highest level UM from the financial community. UM that 1:13:20.800 --> 1:13:23.760 would ensure that I would never ever be in a 1:13:23.800 --> 1:13:28.719 position where shareholders were let down again. So it's something 1:13:28.720 --> 1:13:31.599 that I had to be very very honest about in 1:13:31.720 --> 1:13:34.840 the sense that that UM I was never gonna try 1:13:34.840 --> 1:13:38.080 and hide the fact that Sanctuary didn't succeed, even though 1:13:38.160 --> 1:13:41.559 the idea was wonderful. UM. But I also had to 1:13:41.560 --> 1:13:44.439 make sure that I had the right people around me, um, 1:13:44.520 --> 1:13:49.160 in order to gain the trust of the financial community. Okay, 1:13:49.160 --> 1:13:54.400 so what do you do from two thousand six to hypnosis? UM? 1:13:54.520 --> 1:13:59.480 I pretend that everything is perfect, but really I'm terribly depressed. 1:14:00.080 --> 1:14:03.200 And while I continue to manage lots of wonderful artists 1:14:03.200 --> 1:14:06.599 like Morrissey and John Stone and Diane Warren and Justin 1:14:06.640 --> 1:14:09.360 Tranter and The Dream and and and you know, lots 1:14:09.360 --> 1:14:14.680 of incredible people, Macy Gray, I'm probably you know, clinically depressed, 1:14:15.160 --> 1:14:19.479 and I'm trying to keep my chin up and trying to, uh, 1:14:19.520 --> 1:14:24.000 you know, find myself again, because you know, Sanctuary was 1:14:24.040 --> 1:14:30.000 a twenty one one year experience that uh was really about, 1:14:30.600 --> 1:14:33.880 you know, I think doing something important, um, and then 1:14:33.920 --> 1:14:37.920 it didn't work. And when that happens, of course, UM, 1:14:37.960 --> 1:14:40.280 you know, not only do you feel like a failure, 1:14:40.880 --> 1:14:44.600 but probably wrongly, you also assume that the rest of 1:14:44.600 --> 1:14:48.160 the world sees you as a failure as well. And 1:14:47.880 --> 1:14:50.760 I found myself talking to people all the time, and 1:14:50.760 --> 1:14:53.559 people would would you know, say nice things and do 1:14:53.680 --> 1:14:56.439 nice things. But it didn't feel that way to me. 1:14:56.720 --> 1:15:00.280 To me, it felt like it was a massive failure. UM. 1:15:00.280 --> 1:15:02.479 So it took me a long time to come out 1:15:02.479 --> 1:15:04.960 of that. And even though I think that you know, 1:15:05.040 --> 1:15:09.200 my friends and my family and my contemporaries didn't ever 1:15:09.320 --> 1:15:12.760 really see it, my artists never really saw it. I 1:15:12.880 --> 1:15:15.840 knew it. I knew that I was fighting, um, you know, 1:15:16.040 --> 1:15:20.160 this this feeling inside of me on a daily basis. 1:15:20.800 --> 1:15:23.439 And it just took me, you know, the minute that 1:15:23.439 --> 1:15:27.799 that I hatched the plan for hypnosis and I knew 1:15:27.920 --> 1:15:31.439 exactly what it was. Um, I came out of that 1:15:31.640 --> 1:15:35.200 because then I had clarity on what I could do 1:15:35.800 --> 1:15:40.040 to take this previous failure and turn it into not 1:15:40.320 --> 1:15:44.280 a victory for myself, but a victory for the songwriting community. 1:15:45.080 --> 1:15:47.960 Because that's the you know, the idea of hypnosis was 1:15:48.040 --> 1:15:52.320 born out of managing Diane Warren, managing Justin Tranter, managing 1:15:52.360 --> 1:15:55.880 the Dream and realizing that these people were delivering massive 1:15:55.920 --> 1:16:00.679 hit songs for artists and not getting paid properly. And 1:16:00.680 --> 1:16:06.760 what I saw was that UM streaming was and you know, 1:16:06.840 --> 1:16:10.479 Daniel Eck and Martin Lawrence and at Spotify can attest 1:16:10.479 --> 1:16:13.559 to this. It was very clear to me the first 1:16:13.560 --> 1:16:16.560 time I ever saw Spotify that not only was it 1:16:16.600 --> 1:16:19.559 going to be wildly successful, but the effect that it 1:16:19.640 --> 1:16:22.679 was going to have was to take music from being 1:16:22.720 --> 1:16:27.240 a discretionary or luxury purchase and turn it into a utility. 1:16:27.320 --> 1:16:30.519 Because that ten dollar price point, that ability to have 1:16:30.680 --> 1:16:35.040 access to at that point almost everything to today pretty 1:16:35.120 --> 1:16:38.240 much everything, um, you know, was going to be appealing 1:16:38.360 --> 1:16:42.240 enough to the passive consumer to make them want to 1:16:42.280 --> 1:16:44.040 pay for music. So, you know, if you look at 1:16:44.040 --> 1:16:49.440 where we are today, you know, the benchmark for extraordinary 1:16:49.479 --> 1:16:53.439 success in our business used to be the platinum record, 1:16:53.640 --> 1:16:57.040 you know, million copies in a country like the United 1:16:57.080 --> 1:17:01.040 States that has three sixty million people in it. Today, 1:17:01.120 --> 1:17:03.400 you know that one in three sixty you know, tells 1:17:03.439 --> 1:17:05.599 you that the average person might love music, but they 1:17:05.600 --> 1:17:07.720 didn't love music enough to put their hand in their 1:17:07.720 --> 1:17:11.160 pocket and pull out money to pay for it. Today, 1:17:11.320 --> 1:17:14.280 we have a hundred million homes in the United States 1:17:14.680 --> 1:17:18.000 that are paying for a paid music streaming subscription. Right 1:17:18.080 --> 1:17:21.040 so we've gone from one in three hundred and sixty 1:17:21.040 --> 1:17:24.280 people paying for music to one in three point six 1:17:24.360 --> 1:17:28.040 people paying for music. That's why you're seeing the sort 1:17:28.040 --> 1:17:31.000 of money flooding into this business that you're seeing is 1:17:31.040 --> 1:17:34.920 because music has gone from being this luxury purchase to 1:17:35.040 --> 1:17:38.519 now very much being a utility purchase. That was very 1:17:38.600 --> 1:17:43.400 clear to me. Alongside that, I knew that these great 1:17:43.439 --> 1:17:47.000 songs that these songwriters wrote that when they hit they 1:17:47.000 --> 1:17:49.920 became a part of the fabric of society. And when 1:17:49.920 --> 1:17:52.639 they become a part of the fabric of society, they 1:17:52.680 --> 1:17:56.240 start to have predictable, reliable income, and that that would 1:17:56.320 --> 1:17:59.280 make them investible because those are the same reasons why 1:17:59.280 --> 1:18:09.080 we look at gold and oil is that predictability and reliability. Okay, 1:18:09.160 --> 1:18:11.799 so you said that you had a hundred and seventy 1:18:11.880 --> 1:18:18.559 seven meetings. What transpired to build hypnosis? So out of 1:18:18.560 --> 1:18:21.880 those hundred and seventy seven meetings, which were really about 1:18:22.120 --> 1:18:26.600 educating the investment community, as I say, about this predictability 1:18:26.600 --> 1:18:29.800 and reliability of these income streams, and also the fact 1:18:29.880 --> 1:18:32.640 that the income streams were uncorrelated. Right if you know, 1:18:32.720 --> 1:18:36.360 I compare them to golden oil, and you know, if 1:18:36.479 --> 1:18:39.160 if the if political upheaval, if there's some sort of 1:18:39.200 --> 1:18:43.160 political upheaval tomorrow, the price of golden oil will be affected, 1:18:43.560 --> 1:18:46.559 but the price of songs and the revenues associated with 1:18:46.640 --> 1:18:50.200 songs aren't affected because if people are living their best lives, 1:18:50.520 --> 1:18:53.639 they're doing it to a soundtrack of music. Equally well, 1:18:53.720 --> 1:18:56.639 if they're experiencing the sort of challenges that we've experienced 1:18:56.640 --> 1:18:59.719 over the last fourteen or fifteen months, you're taking comfort 1:18:59.760 --> 1:19:04.800 and escaping with music. So this uncorrelated aspect of the 1:19:04.840 --> 1:19:08.840 revenues is something that investors have a real appetite for 1:19:09.040 --> 1:19:12.480 because they understand that in a world of Donald Trump's 1:19:12.520 --> 1:19:15.120 and you know, all the craziness that that's happening all 1:19:15.120 --> 1:19:18.920 over the world, that having uncorrelated assets, at least in 1:19:19.000 --> 1:19:21.920 part of their portfolio is very important. So it took 1:19:21.920 --> 1:19:24.920 about a year and a half to do these hundred 1:19:24.920 --> 1:19:29.719 and seventy seven meetings, and eight of them said to me, Um, 1:19:30.120 --> 1:19:33.800 don't ever darken our doorstep again. It doesn't matter how 1:19:33.800 --> 1:19:37.679 successful you make this idea. Our investors will never be 1:19:37.920 --> 1:19:39.599 you know, the people that give us money will never 1:19:39.680 --> 1:19:43.759 be comfortable with this. Um. Thirty eight of them said, 1:19:44.439 --> 1:19:47.280 you know, we're in. We want to do this, and 1:19:47.320 --> 1:19:51.280 they backed me with two hundred million pounds and the 1:19:51.320 --> 1:19:55.160 other remaining hundred and thirty odd all said listen, you know, 1:19:55.280 --> 1:19:58.760 we think what you're doing is fascinating and uh, we 1:19:58.880 --> 1:20:01.080 love it, but we can't be your guinea pigs. So 1:20:01.200 --> 1:20:03.960 you go away and make this successful and then you 1:20:04.040 --> 1:20:06.000 come back and see us. Which is how we've gone 1:20:06.040 --> 1:20:09.040 from being a two hundred million pound company to being, 1:20:09.479 --> 1:20:11.360 as you say, at two point to two point three 1:20:11.360 --> 1:20:15.400 billion dollar company. Um, because we went back to every 1:20:15.439 --> 1:20:19.000 one of those hundred thirty one investors that said we 1:20:19.040 --> 1:20:21.559 don't want to be your guinea pig, and we've also 1:20:21.920 --> 1:20:24.600 now gone to know another three d or so on 1:20:24.680 --> 1:20:26.720 top of that. So are about four hundred nine or 1:20:26.880 --> 1:20:30.240 odd investors that make up the two point two billion 1:20:30.280 --> 1:20:33.679 dollars that's in hypnosis, and that's allowed us to buy 1:20:33.800 --> 1:20:38.000 sixty three thousand of the most wonderful songs in the world. Okay, 1:20:38.000 --> 1:20:41.800 why is the company based in Guernsey. It's based in 1:20:41.840 --> 1:20:45.000 Guernsey for tax reasons, um. And that's not you know, 1:20:45.040 --> 1:20:49.200 Guernsey is a British Channel island, so it's not tax avoidance. 1:20:49.640 --> 1:20:53.320 But you know, for example, we get the vast majority 1:20:53.560 --> 1:20:56.519 of our money, our earnings comes from the United States. 1:20:57.000 --> 1:21:00.360 Right if we were based on the mainland in UK 1:21:01.240 --> 1:21:05.839 that those US earnings would be subject to withholding tax. 1:21:06.280 --> 1:21:09.800 By being based in Guernsey, they are not subject to 1:21:10.080 --> 1:21:15.000 withholding tax. Does that mean there are people actually in Guernsey. 1:21:16.560 --> 1:21:22.200 Our administrators and our administrator and administrator in this instance 1:21:22.280 --> 1:21:26.200 is very different to our publishing administrator. Our administrator and 1:21:26.280 --> 1:21:29.599 this instances are the people that deal with the money 1:21:29.640 --> 1:21:33.439 on Hypnosis is part. So I I never touch Hypnosis money. 1:21:33.560 --> 1:21:38.200 Hypnosis money is only ever touched by our administrators. They 1:21:38.240 --> 1:21:40.640 make all the payments on our behalf, They collect all 1:21:40.680 --> 1:21:43.400 the moneys on our behalf. You know, everything gets paid 1:21:43.400 --> 1:21:48.519 through into two our Guernsey bank accounts. So yeah, we 1:21:48.600 --> 1:21:51.200 have a small team of people in Guernsey, but the 1:21:51.240 --> 1:21:54.200 majority of our people are in London and we have 1:21:54.280 --> 1:21:59.479 eighty three people between London and Los Angeles. Okay, you 1:21:59.560 --> 1:22:03.080 have a unique structure and I'll let you explain it 1:22:03.080 --> 1:22:05.160 because I don't want to make a mistake. Where there 1:22:05.280 --> 1:22:09.479 is the company Hypnosis that owns the asset, yet you 1:22:09.600 --> 1:22:15.840 work for a different company that provide management services, Why 1:22:16.160 --> 1:22:20.000 and how does that work? So this so, this is 1:22:20.000 --> 1:22:23.720 what's known as an investment trust and it's a classic 1:22:23.920 --> 1:22:28.200 construct on the London stock market. Right. So so there 1:22:28.200 --> 1:22:31.720 are many many investment trusts. The vast majority of the 1:22:31.760 --> 1:22:35.519 companies in in in the foot see to fifty our 1:22:35.600 --> 1:22:41.160 investment trusts. And this construct of having a vehicle that 1:22:41.280 --> 1:22:45.840 owns the assets and that has no liabilities beyond the 1:22:45.880 --> 1:22:49.720 ownership of those assets is a very very allows for 1:22:49.760 --> 1:22:52.840 a very very clean company. And then you have an 1:22:52.880 --> 1:22:57.920 investment advisor that then manages those assets. So I'm the 1:22:58.000 --> 1:23:02.479 founder of both companies. I'm founder of the parent company 1:23:02.520 --> 1:23:05.320 if you like, or the main company, which is the 1:23:05.360 --> 1:23:10.360 asset holder, Hypnosis Songs Fundlimited. I'm also the founder of 1:23:10.880 --> 1:23:14.439 the Family Music which is the company that manages those 1:23:14.439 --> 1:23:18.360 assets and that buys those assets on the behalf of 1:23:18.360 --> 1:23:20.840 of of of the fund. And as I say, this 1:23:20.960 --> 1:23:26.439 is a classic English stock market construct. Um. And we've gone, 1:23:26.640 --> 1:23:30.479 you know, the three years plus that we've been doing this, 1:23:30.960 --> 1:23:34.320 we've gone from being a normal listing on the London 1:23:34.400 --> 1:23:37.639 stock market to a year later, on the back of success, 1:23:37.680 --> 1:23:41.120 being a premier listing, and then fourteen months ago, fifteen 1:23:41.120 --> 1:23:43.800 months ago we became a foot see two fifty company. 1:23:43.840 --> 1:23:46.439 We're one of the biggest companies on the London stock 1:23:46.560 --> 1:23:50.519 market and we're the number twenty three biggest yielder on 1:23:50.560 --> 1:23:53.639 the London stock Market, meaning that they're only twenty two 1:23:53.640 --> 1:23:57.440 companies that are paying a bigger dividend to their investors 1:23:57.520 --> 1:24:01.400 than we are. Okay, there was some scuttle but about 1:24:01.479 --> 1:24:06.800 this recently. Can you explain how the management company, the 1:24:06.920 --> 1:24:10.439 family operation gets paid and how you get paid as 1:24:10.439 --> 1:24:13.800 opposed to the investor, because there were some analysts and 1:24:13.920 --> 1:24:19.439 investors were kicking around raising questions about this. Yeah, there's 1:24:19.560 --> 1:24:24.640 there were there were some newspaper reports that, um, you know, 1:24:24.720 --> 1:24:29.520 we're basically making the point that the more I invest 1:24:30.400 --> 1:24:33.360 and the more money I raise, the more the family 1:24:33.479 --> 1:24:36.559 music gets paid. Right. But of course, and and that's 1:24:36.600 --> 1:24:39.040 a fair statement to make. It's a it's an accurate 1:24:39.080 --> 1:24:42.320 statement to make. We get paid on the back of 1:24:42.680 --> 1:24:45.519 the money that we raise and the money that we invest. 1:24:45.640 --> 1:24:50.160 So we you know, on the first five sorry, first 1:24:50.160 --> 1:24:53.000 two fifty million pounds that we raised we got, we 1:24:53.040 --> 1:24:55.759 get paid one percent of that as a management fee. 1:24:56.040 --> 1:24:58.240 On the next two d fifty million pounds we get 1:24:58.240 --> 1:25:01.120 paid point nine percent. This is all a matter of 1:25:01.120 --> 1:25:04.680 public records, so I don't mind mind disclosing this. And 1:25:04.720 --> 1:25:07.920 then on on everything beyond that first five million pounds 1:25:07.920 --> 1:25:10.800 we then get paid point eight percent. So the more 1:25:10.840 --> 1:25:13.400 money we raise and the more money we invest, the 1:25:13.439 --> 1:25:17.040 more we get paid. So there are are we're a 1:25:17.040 --> 1:25:20.400 couple of newspaper reports that we're making that point and 1:25:20.439 --> 1:25:24.519 that we're making that point as as perhaps being the 1:25:24.560 --> 1:25:28.320 motive of why we raise so much money and why 1:25:28.400 --> 1:25:32.040 we invest so much money. And what they were missing, 1:25:32.280 --> 1:25:35.880 of course, was that every one of our investors has 1:25:35.920 --> 1:25:39.320 backed us with that money for the last three years, 1:25:39.360 --> 1:25:42.160 as to say, growing it from the initial two million 1:25:42.200 --> 1:25:44.760 pounds to now what is you know, one point seven 1:25:44.840 --> 1:25:47.759 one point eight billion pounds two point to two point 1:25:47.800 --> 1:25:51.240 three billion dollars um. And the reason why they've backed 1:25:51.320 --> 1:25:54.840 us is because part of the thesis from the get 1:25:54.840 --> 1:25:58.840 go was that there was a limited opportunity here to 1:25:59.040 --> 1:26:03.120 buy these assets. It's these great songs at attractive prices. 1:26:03.720 --> 1:26:06.360 I think that two years from now, three years from now, 1:26:06.800 --> 1:26:09.240 it won't be you know, you'll be buying these songs 1:26:09.479 --> 1:26:14.320 for um income, but you won't have the same exponential 1:26:14.400 --> 1:26:17.599 net asset value growth that you'll have based on what 1:26:17.600 --> 1:26:19.960 we've bought over the last two years and what will 1:26:20.000 --> 1:26:23.760 buy over the next two years um and there and 1:26:23.800 --> 1:26:27.280 all of our shareholders have understood that from the get go. 1:26:27.680 --> 1:26:30.599 It's been a part of those discussions from the get go, 1:26:31.080 --> 1:26:33.519 and it's why they continue to back us with with 1:26:33.520 --> 1:26:37.320 with each fundraise and allow us to continue to um 1:26:37.800 --> 1:26:41.160 uh invest in these great songs. Okay, So let's just 1:26:41.320 --> 1:26:45.760 understand there is him, there is hypnosis. It owns the songs. 1:26:45.920 --> 1:26:50.360 Who owns family? And how does family get paid? Yes, 1:26:50.400 --> 1:26:53.679 and let's just use round numbers. You raise a hundred million, 1:26:54.080 --> 1:26:57.360 you get one percent. That's a million dollars that goes 1:26:57.400 --> 1:27:01.800 to family. Is that distributed it? How do we who 1:27:01.840 --> 1:27:07.080 owns family? How you know? House family run? So I 1:27:07.200 --> 1:27:09.840 owned the family. I have some minor shareholders in it 1:27:09.920 --> 1:27:13.160 as well. And the family employs, as I say, the 1:27:13.200 --> 1:27:16.120 better part of eighty three people around the world with 1:27:16.160 --> 1:27:20.400 those fees. Right, So the fund has no expenses other 1:27:20.479 --> 1:27:24.280 than its legal fees and other than its brokers and 1:27:24.360 --> 1:27:28.080 professional advisors, one of which is the family. But the 1:27:28.120 --> 1:27:32.320 people those eighty three people that manage the fund around 1:27:33.520 --> 1:27:36.400 the manage the assets on behalf of the fund are 1:27:36.439 --> 1:27:40.920 paid for by the family. Okay, So now you raise 1:27:40.960 --> 1:27:42.880 on a million, you get a percentage that goes into 1:27:42.880 --> 1:27:46.920 the family. How much does the family make? What's the 1:27:47.000 --> 1:27:52.280 return to the family on regular income. Well, that's not 1:27:52.400 --> 1:27:55.160 a that isn't a matter of of of of of 1:27:55.240 --> 1:27:57.280 public income. But as as I say, you can do 1:27:57.320 --> 1:28:00.559 the sums. You know, we the family makes aximately ten 1:28:00.560 --> 1:28:03.280 million pounds a year, and out of that ten million 1:28:03.320 --> 1:28:05.680 pounds a year, it pays for offices, It pays for 1:28:05.760 --> 1:28:09.960 eighty three employees, It pays for the expenses of operating 1:28:09.960 --> 1:28:12.759 and managing these songs to the best of its ability. 1:28:14.280 --> 1:28:18.000 I guess what I'm asking. Let's assume I'm an investor. Okay, 1:28:18.240 --> 1:28:21.639 I know I'm paying you approximately one per cent on 1:28:21.880 --> 1:28:28.599 every hundred million. But since family is doing the work, 1:28:28.680 --> 1:28:32.800 so to speak, isn't there a raw percentage that I 1:28:32.880 --> 1:28:35.720 know that I will have to pay family every year? 1:28:35.840 --> 1:28:38.639 How does that work? Because an investor is gonna want 1:28:38.640 --> 1:28:41.800 to know. But all of that is spelled out, and 1:28:41.840 --> 1:28:44.040 we have a you know, one of the things about 1:28:44.040 --> 1:28:46.559 being a public company is that you have to have 1:28:46.600 --> 1:28:49.760 a prospectus. And the prospectus is a document that is 1:28:49.840 --> 1:28:52.240 a couple of hundred pages long, that is a legal 1:28:52.320 --> 1:28:56.200 document that literally spells out everything that there is to 1:28:56.240 --> 1:28:59.720 know from costs to you know, what the upside is, 1:28:59.720 --> 1:29:03.120 what the potential downside is, what the investment policy of 1:29:03.160 --> 1:29:07.200 the company is, what the borrowing policy of the company is. 1:29:07.320 --> 1:29:11.960 Literally every aspect of how we do business is spelled 1:29:12.000 --> 1:29:17.280 out in that two perspectives. And the perspectus is something 1:29:17.320 --> 1:29:21.960 that's updated on a yearly basis, and whatever changes are are, 1:29:22.360 --> 1:29:26.040 you know, to any of those policies goes into that document. 1:29:26.320 --> 1:29:29.680 So all of our shareholders are very very clear and 1:29:29.840 --> 1:29:35.439 very aware on a daily basis of exactly how we operate. Okay, 1:29:35.479 --> 1:29:37.960 so let me ask a different question. What is the 1:29:38.040 --> 1:29:43.280 present percentage? And who negotiates the change in the percentage? 1:29:44.320 --> 1:29:48.040 This is a better public record. Yeah, So the present 1:29:48.040 --> 1:29:53.120 percentages point eight percent of every penny raised, right, so 1:29:53.760 --> 1:29:58.880 you know, uh point zero eight percent, no point eight 1:29:58.960 --> 1:30:03.120 point eight of a per end of right, Um, so 1:30:03.280 --> 1:30:06.240 that is that's the current rate. Then we also have 1:30:06.320 --> 1:30:10.240 a performance fee. When that performance fee is ten percent 1:30:10.720 --> 1:30:14.880 over a ten percent hurdle, So that's something that you'd 1:30:14.920 --> 1:30:17.680 have to get your calculator out and and try and 1:30:17.720 --> 1:30:20.040 figure out what I think I think we underten it. 1:30:20.400 --> 1:30:22.960 But what you're saying is the performance fee is what 1:30:23.120 --> 1:30:28.880 family gets paid, the management fee, and potentially a manage 1:30:28.920 --> 1:30:32.479 the management fee is guaranteed, right, which is that how 1:30:32.520 --> 1:30:35.639 much is the percent? And that's the point eight percent. 1:30:35.920 --> 1:30:38.840 So you get paid not only when you not only 1:30:38.880 --> 1:30:42.679 when you raise it. You're getting paid point eight percent 1:30:42.760 --> 1:30:49.320 of the total fund every year. Correct. Okay, so you 1:30:49.400 --> 1:30:54.640 get the point eight then ten beyond ten percent of 1:30:54.760 --> 1:31:00.479 net also goes to family, correct. And that's so and 1:31:00.479 --> 1:31:04.479 and and on that. There's no guarantee because that's based 1:31:04.560 --> 1:31:08.800 on where the share prices for the entire month of March, 1:31:08.880 --> 1:31:12.400 which is the last month of of of our fiscal year. 1:31:13.000 --> 1:31:16.599 So depending on what the average weighted share prices during 1:31:16.640 --> 1:31:19.519 that entire month, we might make a performance fee. We 1:31:19.600 --> 1:31:22.120 might not. If we've raised money, we won't make a 1:31:22.160 --> 1:31:24.559 performance fee because when you raise money, the share price 1:31:24.600 --> 1:31:27.880 goes down because there are shares that are being offered 1:31:27.920 --> 1:31:31.800 at at at at a discount for people to come 1:31:31.800 --> 1:31:35.920 in and and and and invest more money. So, because 1:31:35.960 --> 1:31:38.599 of the fact that we've been so acquisitive um and 1:31:38.640 --> 1:31:42.240 because that's been the focus, the performance fee is is 1:31:42.280 --> 1:31:44.439 something that's been a very minor part of our world 1:31:44.479 --> 1:31:48.040 so far. Okay, So let's just go back for those 1:31:48.080 --> 1:31:50.800 you know and make it very basic. Let's assume, for 1:31:50.800 --> 1:31:55.360 the sake of round numbers, hypnosis generates a hundred million 1:31:55.400 --> 1:32:00.479 dollars in a year. That is not how family gets paid. 1:32:01.200 --> 1:32:04.320 Family gets paid the point eight family gets paid the 1:32:04.360 --> 1:32:10.759 point eight percent, and if you're doing well, the stock 1:32:10.880 --> 1:32:13.519 price will go up and then you'll get the ten 1:32:13.600 --> 1:32:20.440 percent beyond the ten percent. Correct. That is roughly accurate 1:32:20.439 --> 1:32:24.679 and simple terms. Okay, So if the stock price does 1:32:24.760 --> 1:32:29.720 not go up, family does not get paid beyond the 1:32:29.800 --> 1:32:35.040 point eight percent of total funds raised. Correct in order 1:32:35.040 --> 1:32:36.519 for us, in order for us to get paid a 1:32:36.600 --> 1:32:42.120 performance fee, we need to have the stock price out. Okay. 1:32:42.200 --> 1:32:47.679 So let's assume I you want to raise money. Are 1:32:47.720 --> 1:32:50.639 you raising you know, there's different ways. Is it all 1:32:50.800 --> 1:32:53.360 part of the same company. Is it a separate fund? 1:32:53.400 --> 1:32:57.559 How does that go when you raise additional funds? It's 1:32:57.560 --> 1:33:00.120 all part of the same company. There is no there 1:33:00.160 --> 1:33:03.400 is no fund one, fund two, fund three. It's all 1:33:03.520 --> 1:33:06.759 a public company. It's all all trades under the ticker 1:33:06.800 --> 1:33:10.599 of song S O n G, and it's all one company. Now, 1:33:11.000 --> 1:33:15.800 there are instances where you may without getting complicated, where 1:33:15.840 --> 1:33:19.240 you may raise money as a C share rather than 1:33:19.280 --> 1:33:23.120 an ordinary share, and then that C share, once it's 1:33:23.120 --> 1:33:27.839 fully invested, would then be merged into the ordinary shares. 1:33:28.320 --> 1:33:32.160 So that can happen at different times depending on on 1:33:32.320 --> 1:33:35.879 what the circumstances of the fundraise are. But in general, 1:33:36.240 --> 1:33:38.400 the way to the correct way to look at it 1:33:38.439 --> 1:33:41.760 is it's all one company. So let's assume, for the 1:33:41.760 --> 1:33:44.360 sake of discussion, you want to raise a hundred million. 1:33:44.960 --> 1:33:48.040 He who makes that decision, and b do the shareholders 1:33:48.040 --> 1:33:52.719 have to approve it? I make that decision, and then 1:33:52.920 --> 1:33:57.080 that in in a conjunction with my advisers, which are 1:33:57.160 --> 1:34:00.320 in general my brokers. And my brokers are JP Oregon, 1:34:00.600 --> 1:34:03.840 the Royal Bank of Canada, and an English company called 1:34:04.000 --> 1:34:06.599 N plus one Singer, which is the company that brought 1:34:06.680 --> 1:34:09.840 us to the stock market. And then I go out 1:34:10.000 --> 1:34:13.280 and I speak to all of our investors and they 1:34:13.320 --> 1:34:15.240 have a choice of how much they want to put in. 1:34:15.320 --> 1:34:20.120 So the the investors can't stop us from raising money. 1:34:20.160 --> 1:34:22.920 But if they but they certainly can choose not to 1:34:22.960 --> 1:34:28.360 put money in in that latest fundraise. Okay, but theoretically 1:34:29.400 --> 1:34:31.599 they could be they could see it as being somewhat 1:34:31.680 --> 1:34:35.120 diluted relative to the stock market. If you raise more 1:34:35.160 --> 1:34:38.719 money when you go out and you do that raise, 1:34:39.080 --> 1:34:44.120 you're you're right that people come in at a strike rate, right, 1:34:44.200 --> 1:34:47.120 and that strike rate is based on what the NAV 1:34:47.360 --> 1:34:51.160 is of the company net asset value is of the 1:34:51.200 --> 1:34:55.800 company at that moment in time. So the current um 1:34:56.040 --> 1:35:02.680 uh NAV of the company is teen pence and change. 1:35:03.240 --> 1:35:06.320 The current share price of the company is about a 1:35:06.360 --> 1:35:08.840 hundred and twenty three pence, so we're trading at a 1:35:08.880 --> 1:35:13.400 premium of about four or five percent. And if we 1:35:13.400 --> 1:35:16.960 were to issue new shares tomorrow and we issued some 1:35:17.040 --> 1:35:19.479 new shares a small amount of new shares last week 1:35:19.520 --> 1:35:22.400 as an example, then those shares were issued at one 1:35:22.400 --> 1:35:26.559 pound eighteen and people came in. And because of the 1:35:26.560 --> 1:35:29.920 fact that we're taking this money and investing it in 1:35:30.360 --> 1:35:34.960 more assets, no one is diluted because the capt market 1:35:34.960 --> 1:35:38.160 cap of the company grows at the same time with 1:35:38.200 --> 1:35:40.960 the investment. So it's not like you're taking a hundred 1:35:40.960 --> 1:35:44.479 million dollars or a hundred million pounds and you're spending 1:35:44.520 --> 1:35:48.519 it on overheads that don't increase the value of the company. 1:35:48.920 --> 1:35:51.880 You're spending it on assets that do increase the value 1:35:51.880 --> 1:35:55.800 of the company, so there is no dilution. So, as 1:35:55.840 --> 1:35:58.680 you mentioned earlier, one of the good things about publishing, 1:35:58.800 --> 1:36:00.880 especially with some of these like Onic Acts of the 1:36:00.960 --> 1:36:06.479 seventies thereafter, they actually own the publishing. So you've got 1:36:06.640 --> 1:36:09.680 great acts, you've got a hundred and fifty acts, but 1:36:10.360 --> 1:36:13.400 there's a huge number of people out there who still 1:36:13.400 --> 1:36:19.840 own their publishing. How does Hypnosis Hypnosis by what's available 1:36:20.040 --> 1:36:22.679 or does at some point does Hypnosis close its fund 1:36:22.680 --> 1:36:28.439 and say close its organization and we're only managing X number. Well, 1:36:28.479 --> 1:36:32.799 there's certainly a ceiling to our growth, but that ceiling 1:36:32.920 --> 1:36:37.400 is driven by what I referred to as the third 1:36:38.520 --> 1:36:41.560 key factor in what I wanted to achieve with Hypnosis, 1:36:41.560 --> 1:36:45.240 which is that I wanted to take that traditional publishing 1:36:45.920 --> 1:36:49.360 and replace it with song management. Right now, in order 1:36:49.400 --> 1:36:53.479 to be an effective song management er, there's obviously a 1:36:53.560 --> 1:36:56.599 ceiling on on what you can do. So we currently 1:36:56.640 --> 1:37:01.080 own sixty thousand songs. Over five thousand of those songs 1:37:01.080 --> 1:37:04.439 are number one songs, Over fifteen thousand of them are 1:37:04.479 --> 1:37:08.400 Top ten songs, over forty thousand them are top forty songs, 1:37:08.800 --> 1:37:10.800 and the rest are the ones that that that that 1:37:10.960 --> 1:37:14.439 came with them in in word two point two, as 1:37:14.439 --> 1:37:18.160 I say billion or so dollars invested in the next 1:37:18.200 --> 1:37:21.519 two years, I expect to be somewhere around the five 1:37:21.600 --> 1:37:25.360 or six billion dollar mark invested, and I expect to 1:37:25.439 --> 1:37:29.040 grow the fund from the hundred sixty three thousand songs 1:37:29.080 --> 1:37:32.080 that it is today to about a hundred and twenty 1:37:32.080 --> 1:37:35.280 five thousand to a hundred and fifty thousand songs. At 1:37:35.320 --> 1:37:39.400 that point, I will also have grown the active management 1:37:39.400 --> 1:37:42.719 team to about two hundred people, so that we stay 1:37:42.960 --> 1:37:46.479 on that less than a thousand songs per person um. 1:37:46.600 --> 1:37:49.200 And at that point you know whether it's two two 1:37:49.280 --> 1:37:52.760 hundred and fifty people, whether it's a hundred hundred and 1:37:52.840 --> 1:37:55.880 fifty thousand songs. I think that that is the real 1:37:56.000 --> 1:38:00.400 ceiling on being a song management company, because I don't 1:38:00.400 --> 1:38:03.280 think you can manage more than two fifty people. I 1:38:03.320 --> 1:38:06.040 don't think that you can manage more than fifty thousand 1:38:06.160 --> 1:38:08.960 songs with the sort of responsibility that I want to 1:38:09.000 --> 1:38:14.320 manage songs equally well. Coinciding with that same two and 1:38:14.320 --> 1:38:16.479 a half two to two and a half year period, 1:38:17.040 --> 1:38:20.800 I think that the true value of streaming will be 1:38:20.920 --> 1:38:24.280 reflected in the song that the data that you buy 1:38:24.320 --> 1:38:28.040 these songs on and I think at that point, you know, 1:38:28.080 --> 1:38:32.200 there'll be a lot of people that want access into 1:38:32.240 --> 1:38:34.680 this space. I don't think that there'll be a lot 1:38:34.720 --> 1:38:36.960 of access left. I think that there's a lot of 1:38:37.000 --> 1:38:40.400 pipeline out there today, whether it's for me, whether it's 1:38:40.439 --> 1:38:44.040 for Primary Wave, whether it's for Around Hill, whether it's 1:38:44.080 --> 1:38:46.880 for all of you know, KK are these other companies 1:38:47.160 --> 1:38:49.960 BMG that are are are looking to buy as well. 1:38:50.200 --> 1:38:52.519 I think there's more than enough pipeline to go around 1:38:52.560 --> 1:38:56.240 for everybody. Everyone has their own relationships. But I think 1:38:56.240 --> 1:38:58.320 that at a certain point there will be a lot 1:38:58.360 --> 1:39:01.720 of other people wanting to enter space. There won't be 1:39:01.760 --> 1:39:04.240 a lot of of of action left in the space, 1:39:04.680 --> 1:39:08.360 and the multiples will really explode because people will want 1:39:08.360 --> 1:39:11.559 to pay very very high prices to get their hands 1:39:11.560 --> 1:39:14.800 on these assets. And I'm just to be clear, I'm 1:39:14.880 --> 1:39:18.120 never a seller. You know, people like Larry Mistell, they buy, 1:39:18.240 --> 1:39:21.160 they sell, that's the business that that that they're in. 1:39:21.479 --> 1:39:24.080 We don't sell. We're and and we've been very very 1:39:24.120 --> 1:39:27.400 clear with our investors from the get go, and it's 1:39:27.439 --> 1:39:30.160 the reason why I did this as a public vehicle, 1:39:30.240 --> 1:39:33.439 because I never want to turn around. I don't know 1:39:33.439 --> 1:39:36.439 how Larry rationalizes it when he talks to someone like 1:39:36.479 --> 1:39:39.000 Stevie Nicks that you know, he might be selling her 1:39:39.040 --> 1:39:41.640 catalog in two years time. But I never want to 1:39:41.680 --> 1:39:43.599 be in a position where I'm looking someone like Neil 1:39:43.680 --> 1:39:45.920 Young in the I and say that, you know, guess what, 1:39:46.000 --> 1:39:48.800 We've just sold your catalog. So the reason to do 1:39:48.840 --> 1:39:51.839 this is a public company is because effectively the capital 1:39:51.920 --> 1:39:56.439 is permanent, whereas private equity money has five year terms, 1:39:56.560 --> 1:39:59.439 ten year terms, you know, and and at that point 1:39:59.520 --> 1:40:03.479 you have to to to sell and and you know, 1:40:03.520 --> 1:40:06.479 I never want to be in that position. And I've 1:40:06.520 --> 1:40:09.040 even gone to the extent in terms of protecting my 1:40:09.120 --> 1:40:13.920 integrity with the songwriter where if for any reason, our 1:40:14.000 --> 1:40:17.840 shareholders should ever want to sell, or if our shareholders 1:40:17.840 --> 1:40:20.040 should ever want to get rid of me, they have 1:40:20.160 --> 1:40:23.360 to sell the catalog to me, because my relationship is 1:40:23.400 --> 1:40:26.760 with the artists and the songwriters and the producers that 1:40:26.840 --> 1:40:30.519 have allowed me to become the custodian of of of 1:40:30.520 --> 1:40:33.880 of these great works. Um, and that's an important part 1:40:33.880 --> 1:40:36.960 of what we do. Okay, So you know you really 1:40:36.960 --> 1:40:39.799 went to my next question. So getting to some stock 1:40:39.840 --> 1:40:43.759 market issues, I would assume A the company has no debt. 1:40:44.360 --> 1:40:49.280 B it's traded on the stock exchange. See could they 1:40:49.360 --> 1:40:54.160 get rid of you in family D. Could someone come 1:40:54.200 --> 1:40:56.800 in and buy all the stock and essentially own the 1:40:56.840 --> 1:41:00.960 company and run it their way. So in terms of 1:41:00.960 --> 1:41:03.639 of A yes, we're a public company on the stock 1:41:03.720 --> 1:41:06.280 market as are saying, we're a foot see two fifty company, 1:41:06.320 --> 1:41:09.280 one of the highest yielders on the index. And of 1:41:09.320 --> 1:41:14.519 course with that success having given our shareholders of total 1:41:14.560 --> 1:41:20.759 return over the last three years, return over the last year. UM, 1:41:20.800 --> 1:41:24.240 you know, we're looked upon very very kindly, particularly in 1:41:24.360 --> 1:41:29.559 a pandemic environment. UM. We do have debt because our 1:41:29.600 --> 1:41:35.479 prospectives allows us to lever our assets bytent um. And 1:41:35.520 --> 1:41:39.720 that's because our investors want to get paid their dividends UH, 1:41:39.760 --> 1:41:44.040 and they want to to basically by using leverage, get 1:41:44.080 --> 1:41:47.519 even higher dividends and even higher total returns. So the 1:41:47.600 --> 1:41:51.080 leverage is something that is agreed at thirty percent and 1:41:51.120 --> 1:41:56.000 we have a great UH consortium of of of lenders 1:41:56.040 --> 1:41:59.479 led by JP Morgan and City National Bank that do 1:41:59.640 --> 1:42:03.240 that BOB for us UM. And then in terms of 1:42:03.240 --> 1:42:06.040 of of the family I have a ten year agreement 1:42:06.080 --> 1:42:09.080 as the founder of of of both sides. I have 1:42:09.120 --> 1:42:13.840 a ten year agreement with the fund. That agreement rolls 1:42:13.920 --> 1:42:17.040 over UM and I can only you know, we can 1:42:17.080 --> 1:42:20.200 never only ever be removed for cause UM. As I 1:42:20.240 --> 1:42:24.680 mentioned before, we have an administrator that handles all the 1:42:24.680 --> 1:42:28.040 money for the fund that is an independent administrator. We 1:42:28.120 --> 1:42:31.679 never touch or see any of the fund's money. UM. 1:42:31.720 --> 1:42:35.400 We just manage the the assets and the buying of 1:42:35.400 --> 1:42:38.440 of of the assets. I have a board of directors 1:42:38.800 --> 1:42:42.120 that is five people strong, that is led by a 1:42:42.160 --> 1:42:48.240 guy called Andrew Such that a corporate governance specialist, but 1:42:48.439 --> 1:42:51.639 that includes people like Paul Berger who's the former head 1:42:51.680 --> 1:42:55.479 of Sony UK and Sony Europe, was also the head 1:42:55.520 --> 1:42:59.080 at one time of Sony Canada, Sylvia Coleman who was 1:42:59.160 --> 1:43:03.400 his deputy at Sony UK and Sony Europe. Andrew Wilkinson 1:43:03.439 --> 1:43:06.240 who was the business manager along with Prince Rupert Lowenstein 1:43:06.320 --> 1:43:11.040 of the Rolling Stones and Pink Floyd Um and then 1:43:11.560 --> 1:43:16.799 another guy who's a private equity government specialist called Simon Holden. 1:43:17.320 --> 1:43:21.320 And those people obviously are there to hold my feet 1:43:21.320 --> 1:43:23.880 to the fire and make sure that all of the 1:43:23.960 --> 1:43:28.479 boxes are ticked properly and that both corporate governance and 1:43:28.520 --> 1:43:33.080 compliance is adhered to at all times. I'm also surrounded 1:43:33.120 --> 1:43:36.479 by my brokers at JP Morgan and plus one singer 1:43:36.840 --> 1:43:38.960 in the Royal Bank of Canada that are also there 1:43:38.960 --> 1:43:42.040 to protect shareholders as well as to guide me in 1:43:42.160 --> 1:43:45.840 my dealings with shareholders. Um so it's a very very 1:43:45.920 --> 1:43:49.200 robust situation. And then as I say, you know what 1:43:49.200 --> 1:43:51.800 what you know? One of the things that the the 1:43:52.680 --> 1:43:58.400 financial community understands is that whatever the asset is, whether 1:43:58.439 --> 1:44:00.960 it's in the case of hypno us as songs and 1:44:01.080 --> 1:44:05.320 music that's created by artists and songwriters and producers, or 1:44:05.360 --> 1:44:08.960 whether it's something else, the key component is do you 1:44:09.120 --> 1:44:13.880 or don't you have access right and they understand that 1:44:13.880 --> 1:44:18.240 that access is quite often based on integrity and the 1:44:18.280 --> 1:44:21.559 relationships that someone has built over a long period of time. 1:44:22.120 --> 1:44:24.960 So it was very easy for me to be able 1:44:25.000 --> 1:44:30.559 to prevail upon those investors and uh, you know, create 1:44:30.600 --> 1:44:35.080 a deal whereby should our you know, investors ever want 1:44:35.160 --> 1:44:37.720 to get out of the fund? You know, it's very 1:44:37.760 --> 1:44:40.799 easy for them in a in an investment trust because 1:44:40.960 --> 1:44:44.120 they can get out the shares are very liquid and 1:44:44.160 --> 1:44:47.200 someone else will replace them the next day. But if 1:44:47.200 --> 1:44:49.920 for whatever reason. If we decide that the company should 1:44:49.920 --> 1:44:54.080 not be a public company anymore, then the only person 1:44:54.479 --> 1:44:59.479 that these assets can be sold to Army UM unless again, 1:44:59.640 --> 1:45:02.960 unless I'm fired for for cause, and I'm never going 1:45:03.000 --> 1:45:05.160 to put myself in a position having built all this 1:45:05.640 --> 1:45:09.559 just just I understand you talk about the tenure rollover. 1:45:10.000 --> 1:45:14.880 Are you talking about you, Merk or Family? And just 1:45:15.080 --> 1:45:18.080 the other question being theoretically, I'm not saying it's going 1:45:18.160 --> 1:45:21.040 to happen. Could someone come along and buy up all 1:45:21.080 --> 1:45:25.639 the assets so effectively they have control or is there 1:45:25.720 --> 1:45:28.160 some kind of voting structure or something that makes it 1:45:28.200 --> 1:45:32.320 that that can't happen. So when I talk about the 1:45:32.360 --> 1:45:35.519 Family and Mark were effectively one and the same, because 1:45:35.680 --> 1:45:37.720 the company is my company with the exception of a 1:45:37.720 --> 1:45:42.280 few minor shareholders, and therefore the contract that I have 1:45:43.000 --> 1:45:46.599 with the fund is through the Family Music Limited as 1:45:46.680 --> 1:45:50.439 my operating company. UM. In terms of of you know, 1:45:51.160 --> 1:45:53.920 any company that's on the stock market could be the 1:45:53.960 --> 1:45:56.960 subject of a hostile takeover this, you know that, and 1:45:57.040 --> 1:46:00.439 that's something that of course shareholders would have to vote on, 1:46:00.960 --> 1:46:04.599 and uh, you know, there's there's always the chance when 1:46:04.640 --> 1:46:07.800 you're on the on the public market that even though 1:46:07.960 --> 1:46:10.840 something like that is remote, there's always a possibility that 1:46:10.880 --> 1:46:14.560 it could happen. Okay, Now, just telling about the landscape 1:46:14.560 --> 1:46:20.280 in general. What are the new opportunities in sync and 1:46:20.320 --> 1:46:25.320 what are the new opportunities relative to collection in general, 1:46:26.040 --> 1:46:29.840 and where is the focus of your managers? So the 1:46:29.880 --> 1:46:33.479 focus is very much on getting more out of these 1:46:33.520 --> 1:46:36.559 great songs, and getting more out of them in many, 1:46:36.600 --> 1:46:39.360 many different ways. So you know, we own the great 1:46:39.400 --> 1:46:43.879 Al Jackson's catalog, and when we bought Al Jackson's catalog, 1:46:44.160 --> 1:46:48.439 it was making predictable, reliable income of four grand a year. 1:46:49.240 --> 1:46:55.240 But you know, of that income was concentrated on one song, 1:46:55.640 --> 1:46:59.000 Al Green's Let's Stay Together and as there probably no 1:46:59.360 --> 1:47:01.760 Al jack and as the drummer and Booker T and 1:47:01.840 --> 1:47:05.880 the MG's had an incredible career between nineteen sixty two 1:47:05.920 --> 1:47:08.840 and when he died in nineteen seventy five, where he 1:47:08.920 --> 1:47:12.520 wrote you know thirteen or fourteen of the most important 1:47:12.520 --> 1:47:16.559 soul pop classics, not only Let's Stay Together, but still 1:47:16.600 --> 1:47:19.759 in Love with You and call Me for Al Green 1:47:19.800 --> 1:47:24.280 plus seven or eight of his other biggest songs he wrote, uh, 1:47:24.320 --> 1:47:26.880 you know Booker Team, the MGS, Green Onions plus most 1:47:26.920 --> 1:47:32.439 of their big records, plus getting royalties on big records 1:47:32.439 --> 1:47:36.320 by Bill Withers and Otis Redding and many many others. 1:47:37.640 --> 1:47:43.960 So of the concentration of this four grand is on 1:47:43.960 --> 1:47:47.280 one song, Let's Stay Together, which just tells you what 1:47:47.400 --> 1:47:49.360 I was, you know, a great example of what I 1:47:49.400 --> 1:47:53.200 was saying before about these uh you know, big companies 1:47:53.200 --> 1:47:55.960 that have twenty thousand songs per person, they don't have 1:47:56.080 --> 1:48:00.519 the ability to actively manage. They're just taking incoming requests. 1:48:00.600 --> 1:48:03.000 So in the year and a half that we've owned 1:48:03.000 --> 1:48:06.000 the catalog, we've gone from four hundred grand a year 1:48:06.080 --> 1:48:08.000 to six hundred grand a year, so we've grown the 1:48:08.040 --> 1:48:11.800 earnings by a third. But crucially in doing that, we've 1:48:11.840 --> 1:48:15.720 taken the earnings of Let's Stay Together from of the 1:48:15.800 --> 1:48:19.320 overall number to less than fifty percent of the overall number. 1:48:19.640 --> 1:48:23.559 And the remaining is now having put green onions in 1:48:23.560 --> 1:48:27.080 about ten different movies, it's putting Call Me in a 1:48:27.080 --> 1:48:30.320 TV commercial, it's putting Still in Love with You in 1:48:30.360 --> 1:48:34.839 a movie, a TV commercial, and also having John Legend 1:48:34.880 --> 1:48:38.000 interpolated in a new song on his last album that 1:48:38.080 --> 1:48:40.040 was top ten all over the world that we owned 1:48:41.320 --> 1:48:46.040 of the new song because of the interpolation, so everyone 1:48:46.160 --> 1:48:49.439 is focused on on on you know, how to you know, 1:48:49.520 --> 1:48:53.400 we basically operate every song on its own p anal 1:48:53.479 --> 1:48:56.880 as if it was its own business, not to institutionalize it, 1:48:57.280 --> 1:49:01.560 but basically to give a starting point to a conversation 1:49:02.040 --> 1:49:05.040 about whether or not we think the song is performing optimally, 1:49:05.600 --> 1:49:10.599 and in most cases really to guilt people into going 1:49:10.760 --> 1:49:13.080 hold on a set. That song is way better than that. 1:49:13.120 --> 1:49:15.160 We should be doing way better than that with that song, 1:49:15.240 --> 1:49:18.320 and it gives that kind of impetus for people to 1:49:18.360 --> 1:49:20.760 go out and do something with it. So, you know, 1:49:20.760 --> 1:49:24.080 when we look at the Blondie catalog that we acquired 1:49:24.200 --> 1:49:26.719 a little more than a year ago, you know when 1:49:26.720 --> 1:49:31.639 Blondie started, and you've written two really important pieces over 1:49:31.680 --> 1:49:35.960 the last ten days or so on TikTok that everyone 1:49:36.000 --> 1:49:40.920 in the music business should read. Because these new opportunities, 1:49:41.000 --> 1:49:44.880 whether it's TikTok, whether it's Peloton, whether it's Thriller, you know, 1:49:45.320 --> 1:49:49.679 these are are are big opportunities. One because there's massive 1:49:49.720 --> 1:49:53.920 consumption taking place, and too because it's new income. These 1:49:53.920 --> 1:49:57.519 are not income streams that are in the data on 1:49:57.640 --> 1:50:00.960 which you're buying these catalogs. So it's real value add 1:50:01.080 --> 1:50:04.439 from the get go. So when when when we uh 1:50:04.680 --> 1:50:08.400 signed Blondie, they didn't have a TikTok page. Amy Thompson, 1:50:08.439 --> 1:50:12.400 who's the chief catalog officer, got very very excited obviously 1:50:12.439 --> 1:50:15.720 about Debbie Harry being the icon that she is and 1:50:15.840 --> 1:50:19.000 Christine and Debbie being the incredible songwriters that they are. 1:50:19.720 --> 1:50:24.439 They started a campaign to create Blondie's TikTok page. They 1:50:24.479 --> 1:50:28.880 put Heart of Glass up there, and you know, very 1:50:28.920 --> 1:50:33.280 soon after that, Miley Cyrus covered Heart of Glass. That 1:50:33.439 --> 1:50:36.960 gave us an opportunity to bring Debbie and Miley together 1:50:37.560 --> 1:50:41.879 and create some you know photos that looked like Debbie 1:50:41.880 --> 1:50:46.960 and Miley, you know, Miley of and Debbie of nine 1:50:48.080 --> 1:50:51.559 together having a good time in a club that you know, 1:50:51.840 --> 1:50:56.040 quote unquote went viral. And you know, from last October 1:50:56.640 --> 1:51:00.160 until the very moment, Heart of Glass hasn't been out 1:51:00.280 --> 1:51:04.479 of Spotify's viral charts, right and and and you know, 1:51:04.520 --> 1:51:07.120 I think some at last count, you know, Blonde you've 1:51:07.120 --> 1:51:11.160 had over a million participants on their TikTok channel. Um, 1:51:11.240 --> 1:51:13.800 the same thing is happening with Nile Rodgers. We went 1:51:13.840 --> 1:51:17.360 out and took everybody dance the Great chic song, UM, 1:51:17.640 --> 1:51:20.599 and we made a new version of it with uh 1:51:21.040 --> 1:51:25.400 DJ Cedric Gervais and the Sound of Franklin with Nile featured, 1:51:25.720 --> 1:51:29.160 uh you know, playing his guitar part, and that's becoming 1:51:29.160 --> 1:51:32.320 a hit all over again. And you know, literally came 1:51:32.320 --> 1:51:36.439 out in last I think October, and every week the 1:51:36.439 --> 1:51:40.200 streams are bigger on it, and the TikTok numbers are 1:51:40.240 --> 1:51:43.639 bigger on it. So it's just really about, you know, 1:51:44.040 --> 1:51:45.920 what makes us different. I don't know if you know 1:51:45.960 --> 1:51:49.960 the statistic, but the Royal Bank of Canada, who as 1:51:50.000 --> 1:51:52.960 I mentioned, is one of our brokers, UM, they put 1:51:52.960 --> 1:51:57.360 out a comparison chart last year in July when we 1:51:57.400 --> 1:52:02.599 released our fiscal numbers for Mark thirty, the same day 1:52:02.640 --> 1:52:05.960 that Warner I p oed, and they did a comparison 1:52:06.000 --> 1:52:10.360 between the two companies. And at that point, Warner Chapel 1:52:10.439 --> 1:52:14.800 had done six hundred forty million dollars in their fiscal year. 1:52:15.400 --> 1:52:18.240 We had done ninety million dollars in our fiscal year, 1:52:18.320 --> 1:52:22.160 so we did approximately twelve percent of Warner's numbers. They 1:52:22.200 --> 1:52:25.400 did it on one point four million songs. We did 1:52:25.400 --> 1:52:27.920 it at the time on thirteen thousand songs, so we 1:52:28.040 --> 1:52:31.479 did twelve percent of the revenue on less than one 1:52:31.520 --> 1:52:34.639 percent of the songs. Their songs were putting out. Our 1:52:34.720 --> 1:52:36.800 songs were putting out six thousand, two hundred and eighty 1:52:36.840 --> 1:52:39.439 dollars per song. Their songs were putting out a hundred 1:52:39.479 --> 1:52:42.599 and seventy five dollars per song. And that's not because 1:52:42.640 --> 1:52:45.599 we're better than they are or we're smarter than they are, 1:52:46.320 --> 1:52:48.599 quite the opposite. As I said before, there's great people 1:52:48.640 --> 1:52:53.040 working in those companies. It's purely because we're structured to 1:52:53.120 --> 1:52:55.600 be able to have the bandwidth, to be able to 1:52:55.680 --> 1:52:59.519 actively manage these songs, to do song management rather than 1:52:59.560 --> 1:53:03.080 just collect passive requests. Mark, you're a force of nature 1:53:03.240 --> 1:53:06.840 and I'm very impressed. You certainly know your business and 1:53:06.920 --> 1:53:10.000 the business at larger You can pull these names statistics 1:53:10.080 --> 1:53:13.000 right out of your butt very easily. So I want 1:53:13.000 --> 1:53:15.800 to thank you so much for taking this time to 1:53:15.840 --> 1:53:21.240 illuminate about your history and hypnosis. I think people have 1:53:21.280 --> 1:53:24.320 a much better understanding of what's going on. Thanks again, 1:53:24.560 --> 1:53:28.160 it's my pleasure, Bob. Thank you, and please keep writing 1:53:28.160 --> 1:53:30.160 about the music that you love, because when you do, 1:53:30.200 --> 1:53:32.640 I think you're the best there is. Well, thank you 1:53:32.680 --> 1:53:35.719 so much. Until next time, this is Bob left sex