Rude Records

Idea

Introduction

Rude Records is an independent record label based in Europe and distributed worldwide.

We are recognised today as one of the main players in the alternative rock/pop-punk scene globally, with long-standing connections across the industry. We recently expanded our presence to North America, Japan, Australia, and South East Asia.

Rude Records currently counts a total catalogue of over 150 releases and has been developing its own growing roster of international artists during the past decade. We also represent a selection of alternative US labels in Europe.

We manage internally all functions of a typical record label (A&R/talent scouting, marketing/PR/communications, royalties mgmt) and have direct worldwide physical distribution deals; Rude Records is digitally distributed worldwide by The Orchard, one of the main global digital aggregator, owned by Sony Music. Rude is also a music publisher.

Intended impact

Rude Records business model has been structured over time mainly above three pillars:

• Signing and development of own roster of Artists.

• Label Management (exclusive representation) for US labels in Europe.

• Services to the music industry (CD/vinyl printing, marketing and PR services, rights exploitation, etc.).

We see a great opportunity to invest in the music market today especially for signing worldwide deals acquiring master rights. Goldman Sachs estimated recorded music revenues to more than double to $41 billion by 2030 and that streaming will account for $34 billion of that.

(Source: IFPI, Pwc, Goldman Sachs Global Investment Research)

Our aim for the near future is two-pronged: on one hand, uncovering new talents and nurturing them to global recognition, and on the other helping established Artists unleash their full potential in the streaming era.

Substantial accomplishments to date

Rude Records has a catalogue of over 150 releases from more than 60 artists. Here below are some of the milestones we reached side by side with them.

• 330K+ albums sold overall, comprised of:
- 276 million streams
- 60k physical copies
- 100k track downloads
- 35k album downloads

• 27 million streams in just the last 3 months

• 4 million listeners, 48 million streams during the last 12 months on Spotify alone

• "Set It Off - Duality" awarded "Double Silver" from independent music companies association IMPALA

• Regularly included in the most popular genre-specific Spotify and Apple Music playlists: Rise and Grind, Breaking Rock, All New Rock, Pure Pop Punk, New Noise, among others.

Presence on radios, TVs, Press, Online

While on campaigns, our Artists are regularly featured on media across the world. Some of them fiercely defend their position in the alternative-rock niche, some cross over to mainstream getting regularly playlisted on national radios, TVs, or visibility on newspapers, as well as all sort of music press and a variety of specialist music blogs around the world.

From MTV to BBC radio, or music magazines such as Alternative Press, Rock Sound, Kerrang, or more lifestyle publications like Vice, Red Bull or the Billboard - all of them throughout the years have featured our bands. Touring worldwide, our artists back up locally in each territory the promotional effort the Rude team puts in place.

Monetisation strategy

In a context of solid growth of annual revenues, Rude Records is seeing an ever-increasing importance of digital/streaming, now amounting to almost 60% of the revenue mix. Following market trends, physical sales have declined, although a growing catalogue kept them just above 20%. Exploitation of rights (synchronisations with ads and movies, performance rights, publishing) is a minor but steady part of the business, with potential for growth. A small component is made up of services (CD and LP printing, PR services, etc).

When we look at our releases, on average we see that:
• more than 80% of incomes come from digital (increasingly so)
• of this, 85% comes from streaming (increasingly so)
• of this, 85% comes from paid subscription services (increasingly so)
• Spotify represents around 70% of these subscription revenues; Apple Music follows with 15%.

As a result, we believe we are perfectly placed to make our catalogue benefit from the current natural, exponential growth of the market.

Use of proceeds

At this early stage of the streaming era, successful releases are very much comparable to safe-haven assets, thanks to their uncommonly stable and long lifecycles. Think of any hit from the '60s or '70s (yes, there are a lot): how many other commercial products do you recall with such a long lifecycle?

In this context, the growth and development of our Company are going to follow four main directions:

• The company has the resources and vision to tap into different genres, signing new Artists outside the current niche. Improved financial resources will give access also to a larger number of established Artists, which require significant upfront investments.

• Thanks to almost twelve years of experience, Rude Records is largely prepared to optimise and monetise catalogue acquired from other Labels/Artists.

• Strengthening the existing international set-up. Local offices in the main markets (USA and UK) with dedicated staff on the field will improve A&R/scouting and sales/marketing.