JKBX, a start-up offering retail investors fractional shares in thousands of hit songs, is partnering with electronic market-making firm GTS Securities for U.S. equity trading, the companies said in a joint statement Friday (Feb. 3).
The partnership is a sign that investing in songs and catalogs rights — a burgeoning asset class so far open to only the biggest, most monied music fans — is taking another step toward the mainstream. By teaming up with the electronic market maker GTS, JKBX is positioning itself to have one of the most prominent platforms when it launches its public offerings in late 2023.
Pronounced “jukebox,” chief executive Scott Cohen says JKBX has acquired $1.7 billion in music rights and is aiming to acquire $4 billion in rights before their LLC offerings go live. Once those regulation a+ initial filings are registered with the U.S. Securities and Exchange Commission, everyday investors will be able to buy bite-sized investment stakes in songs by current artists and back catalogs belonging to rock legends for a price starting at around $10.
“A handful of private equity firms, multinational corporations and major labels control the most valuable music rights in the world,” Cohen said in the statement. “JKBX’s platform will allow these entities and other significant rights holders to unlock the true value of these assets by offering them to retail investors to buy and sell in a regulated marketplace.”
Cohen, who co-founded The Orchard and was previously Warner Music Group’s chief innovation officer, last year named Matt Brown, formerly of Citadel and Ripple, as JKBX’s chief technology officer tasked with building out the tech powering the platform. With a high-frequency quantitative trading firm, GTS is responsible for nearly $13 trillion of market capitalization — or 3-5% of the daily cash equities volume in U.S. stock markets — making it a designated market maker. Through the partnership, JKBX will gain access to GTS’s technology, a competitive digital advantage in accessing U.S. public markets.
“GTS excels in making markets for every major financial asset class and providing enhanced liquidity through sophisticated, real-time pricing,” said GTS Securities co-founder/CEO Ari Rubenstein in a statement. “This same expertise can be applied to music royalties, which represent the next exciting tradeable asset class.”
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