Introduction
Music royalties have become one of the most lucrative and overlooked asset classes for investors seeking passive income with strong growth potential. Unlike traditional investments like stocks and bonds, music royalties generate recurring revenue from streaming, radio play, sync placements, public performance, and more.
With the rise of digital streaming platforms like Spotify, Apple Music, and YouTube, the earnings potential of music catalogs has surged, with some growing 90%+ year over year. Below, we break down three key reasons why now is the best time to invest in high-growth music royalties, using real examples of catalogs currently available on Royalty Exchange.
1. Royalty Payouts Are Higher Than Ever Due to Streaming Growth
Streaming has transformed the music industry, turning one-time album sales into long-term, recurring revenue streams. Subscription-based platforms like Spotify and Apple Music now account for nearly 85% of all music revenue, leading to larger and more frequent royalty payments for catalog owners.
Key Stats on Streaming Growth:
- Global streaming revenue reached $42 billion in 2024, up 13.2% from 2023.
- Spotify alone reported over 675 million active users and 263 million premium subscribers, a 12% increase year over year.
- The average number of streams per song has risen 20% annually, increasing revenue for music rights holders.
Example: White Tee by Summer Walker
- Last 12 months earnings: $29,265
- 3-year average earnings: $14,662
- 3-year growth: 99.59%
The royalties in this catalog for White Tee increased from $9,365 in 2023 to $29,264 in 2024, fueled by playlist placements and ongoing fan engagement from TikTok and Instagram UGC content. This kind of rapid income growth is difficult to achieve in traditional assets like stocks or bonds, making music royalties an increasingly valuable passive income stream.
2. Music Royalties Are a Recession-Proof Income Source
Unlike stocks and real estate, which are directly impacted by economic downturns, music royalties remain stable because people continue listening to music regardless of financial conditions.
Why Music Royalties Offer Economic Protection:
- Music consumption remains stable even in recessions—streaming subscriptions continue growing as people opt for affordable entertainment.
- Streaming services like Spotify and Apple Music have seen subscriber growth even during market downturns, ensuring consistent revenue for rights holders.
- Music royalties are non-correlated assets, meaning they don’t rise and fall with the stock market, making them an excellent hedge against volatility.
Comparing Music Royalties vs. Traditional Investments:
- DaBaby’s Goin Baby catalog grew 291%+ in the last year, while the S&P 500’s historical average return is 8-12% per year.
- Bonds and fixed-income investments have struggled to keep up with inflation, whereas music royalties generate recurring revenue that grows with streaming demand.
Example: DaBaby’s Goin Baby Catalog
- Last 12 months earnings: $15,932
- 3-year average earnings: $8,322
- 3-year growth: 91.44%
With earnings more than doubling in the last year, this catalog demonstrates how music royalties can outpace traditional investments, particularly during economic downturns and times of uncertainty.
3. It’s Easier Than Ever to Get Started with Investing in Songs
For decades, investing in music royalties was limited to record labels, publishers, and industry insiders. Now, platforms like Royalty Exchange allow any investor to purchase income-generating music catalogs for as little as a few thousand dollars.
How Royalty Exchange Has Made Music Investing Accessible:
- Investors can buy music catalogs for as little as $2,000-$10,000.
- Every listing provides transparent financial data, including earnings history, growth trends, and payout structures.
- Auctions and direct offers allow investors to purchase royalties at fair market value.
Steps to Get Started with Music Royalties on Royalty Exchange:
- Sign up for a free account on Royalty Exchange.
- Browse active music catalogs and review their earnings data and streaming performance.
- Place a bid or make an offer based on historical revenue trends.
- Win the auction and start earning passive income from royalties immediately.
Example: Take You Away Catalog
- Last 12 months earnings: $3,090
- 3-year average earnings: $1,583
- 3-year growth: 95.19%
This catalog represents a strong entry-level investment with steady revenue growth and a low acquisition cost, making it ideal for first-time music investors. It also goes to show that even catalogs without A-list artists and hit songs can have massive growth in royalty income year over year and consistent earnings. The investor who purchased this catalog in April, 2024 has already made a whopping 38.6% yield on their investment, all from passive income from royalty earnings sent to them bi-annually.
Final Thoughts: Why High-Growth Music Royalties Are a Smart Passive Income Investment
Music royalties are no longer an exclusive asset class for major investors. With platforms like Royalty Exchange, anyone can own a share of a hit song and start generating passive income immediately.
With some royalty earnings growing 90%+ year over year, music catalogs provide:
- Higher payouts than ever before due to streaming growth
- Recession-proof income that outpaces the stock market
- An accessible way to invest with as little as a few thousand dollars
For investors looking to diversify their portfolio with stable, high-growth passive income, music royalties offer one of the best alternatives to stocks, bonds, and real estate.
On Royalty Exchange you can sign up as an investor and search through thousands of music catalog listings that include producer and songwriter royalties to some of the biggest songs of the past few decades. Discover why song royalties are one of the best investments to grow your wealth in 2025 and download the free Ultimate Guide To Music Royalties to learn everything you need to know about investing in royalties.
