Investors

The Music Fund (TMF) provides financial services to musicians using streaming data. Our artist-funding model challenges traditional credit scores or hunches from A&Rs having to physically scout out talent. The Silicon Valley team behind TMF has a deep background in data science and finance. We developed the first real-time, automatic music valuation model (AVM) at one of the world's leading systematic investment firms that had $30B in assets under management (AUM). Since becoming an independent company in late 2018 and getting into Techstars Music in 2019, TMF has developed an industry-first, fully automated process for artist funding. Artists can get up to $50,000 within just 24 hours.

The music industry is growing rapidly, and Goldman Sachs predicts another 4x increase over the next 10 years to reach $80B in global revenue by 2030. As pointed in The Economist, music royalties are viewed as an attractive uncorrelated asset class offering a source of steady, passive income that compares favorably with alternatives, especially in the current low-interest climate.

At the high-end of the market, investors are paying up to 20x annual royalty revenues to purchase high-profile catalogs. Take, for example, the recent acquisition by UMG of 600+ Bob Dylan songs for upwards of $300M. This investing strategy can work great and is analogous to Warren Buffet using his intuition, insight, and experience about companies to make a small number of large bets in the stock market. Our model is the opposite of that strategy. TMF was born from the world of systematic investing, where companies like Renaissance Technologies use data and algorithms to quantify risk and make a large number of small bets.

We don’t just analyze a few royalty statements that can only capture a piece of the story. Our edge in music investing comes from the millions of data points generated per artist by streaming, coupled with advanced AI machine learning algorithms. We’ve trained our algorithms to evaluate catalogs down to the individual track level. Our AVM can price each track, quantify risk, and, through rapid re-investing of royalty income, balance the return of the portfolio with giving artists the best deal available.

Our real-time AVM can price whatever royalties an artist is interested in selling. That means we can systematically invest in the streaming revenue of hundreds of thousands of tracks from tens of thousands of artists. This will uniquely enable us to offer investors broad exposure to the music industry as a whole and generate low-risk, attractive returns while still benefiting artists.

Figure: The graph on the left shows our stochastic analysis of many possible futures for hundreds of different music portfolios selected by our algorithm. Some portfolios do better than others but the average, indicated by the densest part of the graph, shows strongly positive returns. This is summarized in the graph on the right which shows how the expected returns increase as the portfolio size goes up. The "risk adjusted" line takes into account volatility. It shows an even more robust increase because the ups and downs in earnings drops off quite rapidly once a portfolio has 40-50 artists.

Aside from mitigating risk by buying a share in many tracks from lots of different artists, TMF takes other steps to mitigate different types of risks, including:

To discuss any of the information on this page, please email us at info@themusic.fund and include the subject line: Investing in TMF.

Legal Disclaimer

No information provided on this website shall constitute an offer to sell or a solicitation of an offer to make an investment in any securities or ownership interests in The Music Fund Advisors, Inc. (the “Fund”). This website does not constitute an offer to sell or buy any securities or ownership interests of the Fund (“Interests”). There shall be no offer or sale of the Fund’s Interests without:

Only once both of the foregoing conditions precedent have been satisfied, to the Fund’s satisfaction, will the Fund then proceed to deliver a set of confidential offering materials (the “Offering Materials”) to that qualifying prospective investor.

All information contained on this website (including this disclaimer language) is qualified in its entirety by and subject to the information contained in the Offering Materials. As explained in detail in the Offering Materials, Interests in the Fund are not registered (nor is there any present intention to have them registered) under the 1933 Act, or the securities laws of any states, and will only be offered and sold in reliance on exemptions from the registration requirements of the 1933 Act and requisite state laws. The Interests in the Fund, once acquired, may not be transferred or resold except as permitted by the 1933 Act and requisite state laws pursuant to registration or an exemption therefrom. Neither the Securities and Exchange Commission (the “SEC”) nor any state securities regulatory authority has expressed any approval or disapproval of the Interests in the Fund, nor have any of the foregoing authorities passed upon or endorsed the merits, accuracy or adequacy of the Offering Materials. Any representation to the contrary is unlawful.

All information contained on this website (including this disclaimer language) is qualified in its entirety by and subject to the information contained in the Offering Materials. As explained in detail in the Offering Materials, Interests in the Fund are not registered (nor is there any present intention to have them registered) under the 1933 Act, or the securities laws of any states, and will only be offered and sold in reliance on exemptions from the registration requirements of the 1933 Act and requisite state laws. The Interests in the Fund, once acquired, may not be transferred or resold except as permitted by the 1933 Act and requisite state laws pursuant to registration or an exemption therefrom. Neither the Securities and Exchange Commission (the “SEC”) nor any state securities regulatory authority has expressed any approval or disapproval of the Interests in the Fund, nor have any of the foregoing authorities passed upon or endorsed the merits, accuracy or adequacy of the Offering Materials. Any representation to the contrary is unlawful.

No communication, through this website or in any other medium, should be construed as a recommendation for any security offering. This website provides general and preliminary information about the Fund and is intended for initial reference purposes only. It is not a summary or compilation of all applicable information and is not complete. It is subject in its entirety to the Offering Materials, which will only be provided to qualifying Accredited Investors.

Neither the Fund nor any of its affiliates is a registered investment adviser or registered under the Investment Company Act of 1940.

Prospective investors should not construe the contents of this website as legal, tax, investment or other advice. Each prospective investor should make his or her own inquiries and consult his or her own advisors as to the appropriateness and desirability of an investment in the Fund and as to legal, tax and related matters concerning an investment in the Fund. All prospective investors are strongly advised to consult with their own tax, legal and financial advisors.