Three years after Downtown Music sold its 145,000-song catalog — including works performed by Aretha Franklin, David Bowie, Bruno Mars and Beyoncé — the president of its publishing division says it's making more money than when it held copyright.
That revelation comes amid Monday's announcement that Universal Music Group's Virgin Music Group is acquiring Downtown Music Holdings for $775 million in an all-cash deal expected to close by the middle of next year.
Emily Stephensonwho from 2023 is president of the Downtown suite of publishing companies (Downtown Music Publishing, Songtrust and Sheer), says her division will bring in more than $200 million in revenue in 2024, up 40% from last year and a higher gross than it had in 2020, the year before Concord bought its catalog.
“We're in the middle of extreme growth mode right now,” says Stephenson, who has overseen client acquisition, business development, A&R, rights management and client services for Downtown since March 2023.
Since Stephenson took the helm, the publishing division has signed deals with indie rockers The National, Spirit Music Group and Peso Pluma's Double P Records. According to the company, it now serves approximately 2 million songwriters and customers in more than 60 countries—more than 40% of them outside the United States—manages more than 1.5 million copyrights and has distributed more than $100 million in royalties. through Songtrust.
Access to additional funds helped. In May, Downtown announced it had secured another $500 million in credit from Bank of America — on top of its previous $200 million credit facility — to finance down payments.
“We've been diligent and aggressive about putting that money in,” Stephenson says, offering competitive advances without forcing independent creators to give up any rights. As a result, “We think we're growing at almost twice the rate of the rest of the industry,” he says.
This growth is one of Downtown's strengths. The combined market share held by independent distribution and music companies — meaning non-major labels and self-released artists — grew to 36.7 percent in 2023, up from 28.6 percent in 2015, according to MIDiA Research. As a result, major companies made acquisitions and investments to defend their market share. Downtown's scale and dominant position in this segment made it an attractive way for UMG to grow.
But Downtown's growth has also led to customer complaints about long wait times on Songtrust and concerns that the platform is becoming more exclusive. Stephenson says there are no plans to limit who can sign up to Songtrust, adding that in the past year, Songtrust has cut its average response time to customer complaints from 33 days to 17 hours.
Stephenson, 35, has spent more than a decade in Downtown and previously served as vice president of Downtown Music, and says about 70 percent of the managers in her department have similarly long tenures.
This experience helped retain clients and led to the facilitation of opportunities. Last summer, Downtown client French composer Victor le Masne's “Parade” became the official song for the Paris Olympics and Paralympics. This holiday season, the team landed on Griff's cover Willy Wonka & The Chocolate Factory classic “Pure Imagination” in Target's Christmas campaign.
“We're the only player doing this at scale for indie songwriters globally,” says Stephenson. “I think our future is bright.”
A version of this story appears in the December 14, 2024 issue Bulletin board.
