Key Takeaways

• Xposure Music has secured $42.5 million in debt financing from David Tepper and private investors.
• The company has signed over 100 deals with independent artists since its inception in 2021.
• Xposure aims to expand its portfolio into genres like Latin and K-Pop with the new funding.
• The firm provides flexible financing options to help artists avoid unfavorable record deals.

Xposure Music, a Canadian catalog firm focused on mostly independent artists, said on Monday it secured $42.5 million in debt financing from billionaire hedge funder David Tepper‘s Andalusian Credit Partners and private investors.

Xposure co-founders and co-CEOs Ryan Garber and Gregory Walfish said they have signed over 100 deals with independent and some major label artists worth between $10,000 and $4 million since starting Xposure in 2021. Their firm’s total funding now tops $50 million and includes support from equity investors including Garber’s father, former Cirque du Soleil chairman and a minority owner of the Seattle Kraken Mitch Garber.

In recent years, the billions invested by global asset managers and private equity firms to acquire the rights to music’s most popular songs has prompted smaller investors to exploit their specialized genre knowledge and industry connections to acquire music IP in a niche category.

Major funds doing this include Beyond Music, which acquires K-pop and evergreen Asian music catalogs, Cutting Edge Media, which owns media music rights used by the film, TV and wellness industries, and Duetti, which also buys master recordings and publishing rights from independent artists.

“Our goal is to continue to serve as the gateway for emerging artists to access meaningful funding and take their careers to the next level, and this investment gives us the resources to make that possible,” Garber said.

Xposure’s Walfish tells Billboard the initial idea was to create a platform for artists to submit music, pay a fee and be guaranteed that their music would be heard by a record label. While they had early success — signing up nearly 25,000 artists and 200 record label executives — Walfish said it led them to discover that what artists really needed was financing for future projects. Xposure pivoted to catalog acquisitions and other financing options in November 2023. Walfish says Xposure’s acquisition deals with artists are flexible, with Xposure buying entire catalogs of master recordings, publishing rights and writer’s share in perpetuity, or fractions of the artists’ rights to albums or individual songs. Xposure also offers term advances.

“More options for artists are better because they are not forced to take a crazy record deal, and in our underwriting and due diligence, we see some crazy deals,” Walfish says. “Music has become a great asset class recognized by a lot of people, but … this is peoples’ life work that they’re entrusting you with. We want to build relationships with the artists we work with.”

With this new financing, Xposure aims to selectively expand their portfolio holdings and catalogs in new genres like Latin and K-Pop, to further develop their in-house valuation tools, and explore more strategic partnerships, like the one they have with indie distributor Too Lost. That partnership, announced in October, will help accelerate distribution of the catalogs Xposure has rights to and help it acquire new ones, the company has said.