Follow the Money! Big Capital in the Music Rights Market – Part 3: Shamrock Capital Advisors

Shamrock Capital Advisors, a private equity company based in Los Angeles, made headlines with the acquisition of Taylor Swift’s first six albums from Scooter Braun’s Ithaca Holdings in October 2020. The deal, worth a total of US $405 million, resulted in a significant profit for Scooter Braun. However, Taylor Swift opposed the sale and planned to re-record all six albums to devalue the original master rights. Shamrock Capital Advisors is a subsidiary of Shamrock Holdings, founded in 1978 by Roy E. Disney, a nephew of Walt Disney. The company has a history of notable media acquisitions, including the sale of Blockbuster Entertainment Corporation and Shamrock Broadcasting.

Follow the Money! Big Capital in the Music Rights Market –   Part 3: Shamrock Capital Advisors*

Shamrock Enters the Music Rights Market

In 2010, Shamrock Capital Advisors shifted its focus to the music industry, acquiring a majority interest in INgrooves Music Group, which was later bought back by Universal Music Group. In 2017, Shamrock acquired the remaining interests held by the Disney family and entered the music rights market by acquiring the songwriting catalogue of Stargate, a Norwegian music producer team. Shamrock also purchased the OM dance label master recordings catalogue and a stake in Eminem’s royalty income stream.

In 2020, Shamrock Capital launched its Content Strategy, focusing on equity and equity-related investments in the global entertainment market. They renamed their Entertainment IP Fund to Shamrock Capital Content Fund I (SCCF I), which had US $250 million in AUM. The fund targeted various entertainment IP rights, including filmed entertainment, TV programming, music publishing rights, recorded music masters, and video games. By 2020, SCCF I held interests in over 800 films, 1,000 TV episodes, and 5,000 music compositions. Shamrock then raised US $400 million for Content Fund II (SCCF II) to continue investing in entertainment IP rights, attracting a mix of existing and new investors.

In June 2021, Shamrock closed a new funding round for its Growth Fund V (SCGF V), raising US $1 billion to invest in media, information services, communication, and networking sectors. The limited partners included pension funds, endowments, foundations, family offices, and financial institutions. A year later, Shamrock launched the Debt Opportunities Fund I (SCDOF I) with US $196 million, focusing on lending to entertainment IP rights holders. This fund provided loans to copyright holders, who repaid with interest via future license fees.

Due to strong investor demand, Shamrock launched Content Fund III (SCCF III) in 2022, raising US $600 million by February 2023. This fund continued the Content Strategy by investing in copyright portfolios across various entertainment forms. The first investment of SCCF III was the acquisition of 75-90 per cent of Dr. Dre’s copyright assets, including royalties from his solo albums and his group N.W.A. The remaining 10 to 25 per cent of Dr. Dre’s copyright assets were acquired by Universal Music Group, which also bought the master recording of The Chronic, which Death Row Entertainment had to return to Dr. Dre in August 2022 due to US copyright reversionary provisions. The rumoured combined sales price for both shares in Dr. Dre’s copyright assets was between US $200 to 250 million. In 2023, SCCF III also bought a portion of Metro Boomin’s publishing catalogue and acquired a portfolio of film, TV, and music rights from Vine Alternative Investments Group, including more than 150 Songs of the songwriter and music producer DJ Calvin Harris, which Vine bought for US $105 million in 2020.

Shamrock’s Content Strategy

A presentation for Shamrock’s Capital Content Fund III (SCCF III) from June 2022 outlines the strategy of investing in undervalued entertainment rights, including music, film, TV, games, and sports. The goal is to unlock additional value through active portfolio management, process improvements, and the creation of derivative works. The strategy focuses on content with a long-term revenue-generating profile that is independent of economic cycles and global market fluctuations, aiming for a gross cash return in the mid-teens.

Figure 1: Shamrock Capital’s Content Strategy

Shamrock’s previous funds, SCCF I and SCCF II, had varying performances. SCCF I, with US $249.7 million in commitments, achieved a net internal rate of return (IRR) of 17 per cent and a net multiple of invested capital (MOIC) of 1.4x. In contrast, SCCF II, with US $406.9 million in commitments, performed significantly worse, with a net IRR of just 2 per cent and a net MOIC of 1.0x. The investments for SCCF II might have included Taylor Swift’s first six studio albums. SCCF III received total commitments of US $600 million and invested in a portfolio of film, television, and music rights, including more than 150 songs by Calvin Harris. We can also suspect that SCCF III acquired a share in Metro Boomins’ music publishing catalogue and in a right’s portfolio of Dr. Dre.

The Employees’ Retirement System of Rhode Island (ERSRI) is among the limited partners. In 2020, ERSRI invested US $20 million in SCCF II and a year later further US $10 million in a co-investment vehicle called SCCF Co-Invest, which charged no management fees and no carried interest. In 2022, ERSRI committed US $30 million to the SCCF III. ERSRI’s investment strategy includes a diverse portfolio with significant investments in private equity and hedge funds for inflation and volatility protection.

In the report of Rhode Island’s General Treasurer for the fiscal year 2022 a net IRR of 0.45 per cent and a net MOIC of 1.0x was reported for the SCCF II. The SCCF II Co-Invest fund performed better with a net IRR of 12.2 per cent and a net MOIC of 1.14x. Nevertheless, the General Treasurer recommended to invest US $30 million in the SCCF III. As to the  merits of the investment, the state’s treasurer referred to Shamrock’s reputation in the media and entertainment sector, but he also had concerns about the long investment period. However, an exit strategy could be the conversion of the fund into an evergreen vehicle providing long-term yield or the securitization of the fund’s assets.

Risk and Exit Strategies

Shamrock Capital Advisors is a good case study to understand the rationale behind the investment boom in music IPR. From the beginning, Shamrock was a private equity company with a focus on the entertainment sector. In the mid-2010s, the Shamrock decision-makers realized that music rights seemed to be a good investment opportunity. Shamrock assumed to increase the music catalogues’ values with active portfolio management and process improvements in the music administration and licensing process.

Investments in music IPR promise stable and predictable revenue streams with low correlation to general economic and market trends. Therefore, they are qualified as hedging instruments in diversified investment portfolios. The main target group of institutional investors for these funds are retirement and pension plans, insurance companies, endowments, foundations, sovereign wealth funds, high net worth individuals (HNWI’s) and other financial institutions. They expect an annual rate of return in the mid-teens as highlighted in the case of Employees’ Retirement System of Rhode Island (ERSRI).

The ERSRI case, however, also highlights the risk of entertainment IP investments. ERSRI invested in both, the SCCF I and SCCF II, US $30 million each, but with a very different rate of return. By the end of May 2022, the SCCF I had a net internal rate of return (IRR) of 12 per cent and a net multiple on invested capital (MOIC) of 1.14x, whereas the SCCF II’s net IRR was only 0.45 per cent with a net MOIC of 1.0x. We know that SCCF I includes the Stargate catalogue with hits by Rihanna, Katy Perry and Beyoncé, but we can only speculate on the IP assets in SCCF II. Maybe the first six master recordings of Taylor Swift were included in the fund’s portfolio. However, on 30 May 2025, Taylor Swift informed her fans in a handwritten letter that she had bought back all the master recordings from Shamrock Capital, explaining that her motives were less financial than emotional: “This was a business deal for them [Shamrock Capital], but I really felt like they saw it for what it was to me: My memories and my sweat and my handwriting and my decades of dreams. I am endlessly thankful.” However, the artist has remained silent about the purchase price. The media is speculating that Taylor Swift had to dig deep into her pockets to regain control of the master rights. According to estimates by celebrity gossip magazine Page Six, she had to pay at least US $600 million.

In any case, the deal paid off for Shamrock. However, not every exit from a private equity project is so lucrative. The following exit strategies can be identified:

• The PE company can sell the fund if the fund’s market value has increased.

• Another option is to offer the fund to investors at the stock market in an IPO.

• The securitization of the fund’s assets, e.g. to issue asset-backed securities (ABS) backed by music catalogues.

• The PE fund can be transferred into an evergreen investment fund for the broader public.

• NAV (Net Asset Value) lending, where loans are secured by the value of a private equity fund’s investments.

• A transfer of the fund into another fund (fund-to-fund transfer).

All these exit strategies involve a considerable risk, especially if the PE company is smaller with a limited number of investments. Shamrock Capital Partner is, therefore, a good example, since it has “only” US 4.4 billion assets-under-management, of which half is attributable to entertainment IP funds. However, Shamrock’s Content Strategy does not only include the classical PE funds (SCCF I-III), but also the Debt Opportunities Fund, which grants loans to entertainment IP rightsholders. Therefore, Shamrock has gained the ability to offer music rights-holders two ways of cashing in on their rights: (1) a sale of their catalogues and (2) a loan against future earnings.

All parts of the series “Follow the Money! Big Capital in the Music Rights Market”

Part 1: A Short History

Part 2: The Investment Giants

Part 3: Shamrock Capital Advisors

Part 4: The Business Model of Private Equity Firms

Part 5: The Securization of Music Rights

Endnotes

Music Business Worldwide, “Universal fully acquires Ingrooves Music Group”, February 12, 2019, accessed: 2025-01-28.

Billboard, “Shamrock Capital Acquires Stargate Publishing Catalog, Including Katy Perry, Rihanna & Beyonce Hits”, October 16, 2018, accessed: 2025-01-28.

Ibid.

Shamrock Capital, “Content Fund”, n.d., accessed: 2025-01-28.

EDGAR, “Shamrock Capital Content Fund II, L.P.”, US Securities and Exchange Commission (SEC), Form D, November 12, 2019, accessed: 2025-01-28.

Pitchbook, “Shamrock Capital Growth Fund V, L.P.”, n.d., accessed: 2025-01-28.

Shamrock Capital press release, “Shamrock Capital Closes Inaugural Debt Opportunities Fund Targeting the Content Industries”, July 7, 2021, accessed: 2025-01-28.

Shamrock Capital press release, “Shamrock Capital Expands its Content Strategy with the Closing of Fund III”, February 1, accessed: 2025-01-28.

Music Business Worldwide, “Dr. Dre selling music assets to Shamrock and Universal in $200m+ deal (report)”, January 12, 2023, accessed: 2025-01-28.

Music Business Worldwide, “Shamrock buys rights portfolio from Vine Alternative Investments – including 150+ Calvin Harris songs”, July 18, 2024, accessed: 2025-01-28.

Shamrock Capital presentation “Shamrock Capital Fund III, L.P., June 2022.

Ibid.

Music Business Worldwide, “Dr. Dre selling music assets to Shamrock and Universal in $200m+ deal (report)”, January 12, 2023, accessed: 2025-01-28.

Office of the General Treasurer of the State of Rhode Island, Shamrock Capital Content Fund III., L.P. – Staff Recommendation, June 2022.

Zititiert in Music Business Worldwide, “Taylor Swift buys back master rights to first six albums from Shamrock Capital”, 30. Mai, 2025, Zugriff am 04.07.2025.

* This blog post is based on the report IP Finance in the Music Industry, which was commissioned by the World Intellectual Property Rights Organization (WIPO).