Inside Mavin's $175 Million Sale: Exploring the Intricacies of Acquiring a Record Label (pt.1)

This is a 4-part read. I promise you’ll love it!! 😍

This is an overview of what this entire process might entail from the perspectives of both a potential investor/buyer and Mavin

In the evolution of Afrobeats as a global phenomenon, Mavin Records stands out and has earned its stripe as an esteemed and influential record label in Africa’s history. It is highly revered for its expertise in identifying and projecting revolutionary talents.

Last week, the internet was abuzz over the Billboard report about Mavin Records' pursuit of investment or a potential sale. This development holds significant importance for the Nigerian music industry, which has long been criticized for relying on shady funding sources like internet fraud, commonly referred to as Yahoo, before the advent of foreign investment. This subject has been extensively explored in various accounts, including a recent piece by Ayomide Tayo for Aljazeera.

In the last five years, this narrative has taken a fascinating shift, with a wave of foreign investments and strategic partnerships between local and international companies reshaping the landscape. In 2019, Mavin Records made headlines for securing new funding from Kupanda Holdings, a joint venture between pan-African investment company Kupanda Capital and TPG Growth, a significant investor in notable companies like Spotify, CAA, Uber, and Airbnb.

At the time, such a headline leaned more toward the ‘tech startup’ narrative than a record label.

Between 2018 and now, both major and independent powerhouses such as Universal Music Group, Sony, Warner, OneRPM, Empire, Believe have stationed dedicated teams in the country to tap into the local market and gain market share.

Delving into the Evolution of Mavin Records

Exploring the evolution of Afrobeats to the World sheds light on a pioneering record label that emerged in 2012, following the dissolution of Mohit Records.

2012 - 2013

The label launched with a joint album called Solar Plexus, which features Mavin's inaugural class consisting of founder Don Jazzy, Dr Sid, D'Prince, Tiwa Savage, and Wande Coal. This album houses some Nigerian classics like Take Banana by D'Prince, See Me Ri by Wande Coal, Oma Ga by Tiwa Savage, among others. 

The release of Solar Plexus would catalyze Mavin’s “collective” identity, transcending the trajectories and successes of its individual artists. This sense of togetherness and shared purpose adds to the label's allure and has contributed to its staying power despite the ever-evolving nature of its roster.

Between 2012 to 2014, Mavin raised the stakes, dominating the airwaves with chart-topping hits like Goody Bag, Take Banana by D’Prince; Surulere by Dr Sid; Without My Heart, Eminado by Tiwa Savage, etc. Adding to the singles, they released critically acclaimed albums such as Frenzy by D'Prince and Once Upon a Time by Tiwa Savage.

2014 - 2016 (Mavin 2.0)

After a phase of artist development, which Mavin Records has honed to be one of its “it-factors”, the label introduced the 2.0 class which consists of Korede Bello, Di'Ja, and Reekado Banks. Their addition marked a significant milestone for the company as it birthed group-hits like Dorobucci, Adaobi, Looku Looku, Jantamanta, etc. 

Individually, the label shot many records atop the airwaves as Awww by Di'Ja; Godwin, Romantic, Do Like That by Korede Bello; Katapot, Oluwa Ni, Sugar Baby, Standard, Problem by Reekado Banks; Kabiyesi by Dr Sid and Tiwa Savage’s comeback album RED add to the label’s impressive repertoire. 

Unsurprisingly, this will earn the label well-deserved nominations and wins at MTV Africa Awards, Headies, Channel O Music Video Awards, BET, MOBOs, World Music Awards, etc. In October 2014, Mavin will celebrate its 2-year run with a momentous crew concert at the Indigo 02 in London.

2017 - 2019 (Mavin 3.0)

In 2017, Mavin welcomed a fresh wave of talent with the addition of Johnny Drille, Ladipoe, and DNA to its roster; followed by the exciting introduction of Rema and Crayon in 2019.

The label, within this period, continued its remarkable streak of hit records as Tiwa Savage bagged All Over, MaLo, Lova Lova; and Reekado Banks stayed the course with Easy (Jeje), Like; while Johnny Drille enchanted romantics with Wait For Me, Romeo & Juliet, Hallelujah.

In this period, Tiwa Savage became the first woman to win Best African Act at the MTV EMA awards in Spain; while also making history as the first female Afrobeats artist to sell out the Indigo 02 Arena in London. These milestones would exemplify Mavin’s commitment to smashing stereotypes and creating more inclusive spaces in an industry where most labels are hesitant to invest in female artists.

The entire group later reunited for the catchy anthem All Is In Order, while Rema raved with Dumebi and Iron Man.

2020 - 2023 (Mavin Global)

While it rained certifications in Mavin’s catalog like Do Like That by Korede Bello (Gold in the US); All Over & MaLo by Tiwa Savage (Gold in Switzerland); the label introduced Ayra Starr, Magixx, Boy Spyce, Bayanni, and more recently, Lifesize Teddy.

Despite its growth, the label maintained its “collective” identity with group-hits like Overloading, Won Da Mo, and a joint album dubbed X. The label currently boasts over a million monthly listeners on Spotify alone.

All the while, adding Woman, Calm Down, Soundgasm by Rema; Away, Bloody Samaritan, Rush by Ayra Starr; Love Don’t Cost A Dime, All Over by Magixx; Folake, Carry Me Go by Boyspyce; Ta Ta Ta by Bayanni to its repertoire.

In a market where most labels struggle to function for more than 5 years or simultaneously maintain a diverse roster of artists, Mavin has proven itself a unicorn.

The label’s ability to not only achieve commercial success but also establish a robust business infrastructure further puts it in a league of its own. In 2019, Mavin unveiled two office spaces: a corporate headquarters on the bustling Ajose Adeogun Street in Victoria Island, Lagos, and a dedicated creative enclave in Lekki. The company currently boasts a team of about 70 staff members, likely the largest workforce for any record label in the country. 

Mavin Global Activated!

Per Billboard, Mavin is exploring investment opportunities or even a potential sale. The goal is to position the label for even greater growth as Africa emerges as the next prominent player on the global stage, much like how K-pop and Latin Music have made an international impact.

Needless to say, a lot goes into such a deal before it is finalized, and that’s primarily why we’re here 😅. Billboard also reports strong interest from Universal Music Group (UMG), HYBE, and other music asset investors in the financial sector.

In a move like this, the primary expectation would be for Mavin to engage an investment bank. According to Billboard, the deal is being handled by Shot Tower Capital, a US-based investment bank specializing in the music industry. Shot Tower Capital boasts an impressive portfolio, having worked with renowned estates like Aretha Franklin, Michael Jackson, Prince, Elizabeth Taylor, and Robin Williams, among others.

In case you don’t know - it is common practice to commission stories like that to ensure that anyone who may be interested in investing or acquiring a stake is well-informed about such an exciting opportunity. 

Mavin’s Valuation

A noteworthy part of the report that seemed to catch everyone’s attention - for obvious reasons - is the paragraph teasing potential worth of the deal. It reads, "Mavin's valuation in the proposed deal is above $125 million and could be worth $150 million to $200 million”.

For sake of this piece, we’ll just work with an average of $150 million and $200 million; which should be around $175 million.

It is worth noting that transactions like these take extensive due diligence performed by both the investors/buyers and Mavin. This phase would involve the investors/buyers verifying the stated valuation of Mavin and conducting thorough checks, while Mavin, in line with the quote from Billboard stating "its management will still be in charge," conducts its own due diligence to find an appropriate partner that better aligns with its ambitions. For Mavin, this underscores the significance of choosing a strategic partner, as it is just as crucial as the injection of funds.

In light of these, I’ve been inspired to document an overview of what this whole process might entail from the perspectives of both the potential investor/buyer and Mavin.

We dive deeper, same time tomorrow! 🤗

Updated: read pt.2 here

Updated: read pt.3 here

Updated: read pt.4 here