The current challenges surrounding Covid-19

Insights

Author: Stephen Duval

Posted: 27.03.20

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We live in unprecedented times. I’m sure we have heard that a bit too often in recent years and the current uncertainty means many of us are focused on the now rather than the next.

Alongside many facets of everyday life, the sports, music and entertainment world has been significantly impacted by necessary short-term rescheduling and cancellations with the world coming to terms with and predict the longer-term impacts. These sectors will undoubtedly bounce back. Our love of our team, our desire to share experiences with our favorite artist mean that there is a light at the end of this dark and unpleasant tunnel.

As digital disruption shakes up traditional financing models in the music and entertainment industries, alternative funding opportunities are burgeoning in these sectors.

The current global financial situation due to the widespread on-set of Covid-19 will necessitate a pivoting in these sectors and open up further new avenues for businesses to look for innovative solutions to the financial challenges that they will have to overcome in the short, medium and longer term.

The UK government (as in the US, Germany and Spain) have all unveiled unprecedented packages of financial measures to shore up the economy against the coronavirus impact which includes £330bn in loans. Berlin has pledged a package of at least €550bn and French President Emanuel Macron said there will be unlimited aid for businesses.

Some areas that will see enormous growth in 2020 will undoubtedly be the streaming services for music and entertainment. The growth of Spotify, Tidal and Amazon Music in recent years will explode in the coming months. The opportunities to lean in and adapt to consumer behavioral change will start to become more and more evident as the weeks pass and innovative financial solutions will be needed to help organizations, clubs and companies as they look to re-invigorate their balance sheets and re-finance to adapt to the current “new normal” that we are living in.

The live music world has been blindsided by coronavirus and creatives globally are having to adjust their business models accordingly. For the last six years 23 Capital has been at the forefront of helping unlock the potential of existing assets for teams, leagues, artists and media companies, deploying or advising on over $3bn of direct capital since 2014.

Whilst the financial potential of these sectors may often be hindered by traditional lenders due to a lack of experience and/or resources to assess the value of intangible assets, such as copyright or broadcast rights deals, it is our responsibility to assist businesses and creatives through the coming months and provide appropriate funding for initiatives that support innovative growth and stimulating capital.

Tags: Sport, Music, Entertainment, Coronavirus

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