Blackstone, Hipgnosis Partner To Invest In Music As Streaming Booms

Blackstone Inc. plans to invest $1 billion in acquiring music rights and managing catalogs, a move the asset manager said will benefit from the rapid growth of online streaming, reports The Wall Street Journal.

The investment will come as part of a partnership with an advisory firm affiliated with Hipgnosis Songs Fund Ltd., a music-investment company that trades on the London Stock Exchange. Hipgnosis, led by former pop-star manager Merck Mercuriadis, buys artists’ song catalogs and earns revenue when the music is streamed online or used in movies or advertising.

By partnering with the Hipgnosis advisory firm, Blackstone hopes to cash in on new ways that fans are taking in music via the internet. “The music industry has been at the forefront of the fast-growing streaming economy and is unlocking new ways of consuming content,” Blackstone executive Qasim Abbas said.

The Hipgnosis fund will have the right to co-invest in the new Blackstone partnership’s catalog acquisitions, the companies said. Blackstone will take an ownership stake in Mercuriadis’s advisory firm, and will invest to improve the firm’s data and technology capabilities to help the partnership manage music rights more efficiently.

Hipgnosis has said that its goal is to establish songs as an investment asset class. Mercuriadis, its founder, formerly managed singers such as Beyoncé and Elton John and bands including Guns N’ Roses and Iron Maiden.

Hipgnosis went public in 2018. As of June, it owned the rights to more than 64,000 songs, including nearly 14,000 top-ten hits. Neil Young, Journey, Fleetwood Mac and Mariah Carey are among the artists whose songs Hipgnosis has invested in.

The pandemic and lack of live concerts has prompted artists, including Bob Dylan, to monetise some of their older work, at a time streaming services have been garnering listeners.