Partners Patrick Russo and Jason Sklar discuss media rights, uncorrelated yield and three simple questions for evaluating content.

Shamrock Capital Advisors LLC’s content strategy covers a broad media palette.

“From day one we wanted to diversify across the entire content ecosystem — film, television, music, games sports, YouTube, podcasting, whatever it is — all forms of content and media rights,” said Shamrock partner and executive committee member Patrick Russo.

Launched in 2015, the content strategy has $2.4 billion under management, including the purchase of Vine Alternative Investments LLC's film, television and music portfolio over the summer. Though the firm does not disclose artists or specific works, the holdings reportedly include rights to Taylor Swift recordings.

“When you think about the content we're acquiring, there's not a minute in the day that we're not monetizing some aspect of our portfolio," said Jason Sklar, also a partner and executive committee member.

Content Strategy

Shamrock Capital’s roots date to the 1970s, when the late Roy Disney founded a predecessor firm.

“We're investing out of our third equity fund that acquires and owns libraries, catalogs and rights,” Russo said of the $600 million content strategy Fund III, which closed in 2023.

“We also have a debt product, which is designed to lend to companies or individuals with libraries, catalogs, and rights owners who want or need liquidity but don't ecessarily want to sell their assets," he said.

The content approach differs from Shamrock's PE strategy, which backs companies such as Boardwalk Pictures Inc., which produced "Welcome to Wrexham" and "We Need to Talk About Crosby," and Iyuno Media Group Corp., a content localization company that provides subtitles, voiceovers and other offerings to film and TV groups.

"We have our private equity growth strategy, which invests in themes that we fundamentally believe in across media, entertainment and communications, and within those themes, we try to back the best entrepreneurs, founders and management teams," Sklar said.

"That's apart from what Patrick and I are focused on," Sklar said. “We're trying to generate uncorrelated yield for our investors," he said, meaning returns that aren't correlated to the broader markets.

Shamrock doesn't disclose specific songs, films, content or artists in its portfolio.

“We've been under the radar in a meticulous, respectful way to be sensitive to the artist community,” Sklar said.

However, reports state that Shamrock purchased master rights to Taylor Swift's first six studio albums in 2020 and teamed with Universal Music Group to purchase music assets from Dr. Dre in January 2023.

Likewise, the firm doesn't disclose typical check sizes or other parameters for the content strategy.

"There is a concentration limit, as with most funds, in terms of a single investment," said Leah Hiraoka, who heads investor relations and marketing. “We also have very robust co-invest pipeline from our investors that we can tap to flex up on deal size."

Binging on Media

A range of sponsors and strategics have purchased film and music catalogs or the companies that own them.

• Amazon.com Inc.’s (AMZN) $8.5 billion purchase of Metro-Goldwyn-Mayer Studios Inc. in 2022 brought the streaming company a catalog of more than 4,000 movies and 17,000 TV shows, including the "James Bond" and "Rocky" movie franchises.
• Sony Music Entertainment bought Bruce Springsteen’s music catalog for $500 million in 2021, and reportedly held talks with Queen in June 2024 to acquire the band’s catalog for nearly $1.3 billion. It was also rumored to be close to purchasing Michael Jackson's music catalog earlier this year.
• Universal Music Group purchased Bob Dylan’s songwriting catalog for around $300 million in 2020.
• Apollo Global Management Inc. (APO) led a syndicate investing in a $1.8 billion round of senior notes issued by music publisher Concord in December 2022 and backs HarbourView Equity Partners, a serial acquirer that's purchased catalogs of Pat Benatar, Nelly, Wiz Khalifa and others.
• Blackrock Inc. and Warner Music Group announced a $750 million fund to purchase catalogs with an emphasis on female and diverse artists in 2022.
• KKR & Co. (KKR) partnered with BMG Music to purchase music rights and other assets in 2021. The firm also purchased Kobalt Capital Ltd.’s music catalog, including work by the Weeknd and Lorde, for $1.1 billion in 2021, and reportedly explored selling the assets in December 2023.

Evaluating Content, Tracking Consumption

"We always ask three simple questions," Russo said. "Was the content relevant when it was released? Is it relevant today? And will it be relevant thirty years from now?"

The content process includes forecasting, valuing, transacting and actively managing investments across all media sectors; understanding where and how consumers consume content; and seeing the connections between media, he said.

"You can't think about music and not understand its impact on video games," Russo said. "You can't think about video games without understanding their impact on sports and how sports impact film and television."

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