How does that work?

He's still massive.

But look, I think it depends where in the life cycle you invest.

And so I should say, in royalties, there are different stages in all of the sectors.

So in healthcare, you can do pre-approved, you can do post-approved.

In energy, development assets, producing assets.

Music, early or unreleased music, later stage music.

Why now though? Why should people be thinking about royalties at this stage in the market?

so is that one of the big advantages is steady cash flow broadly, investing in royalties? What are the other key advantages of it? And then where does it fit into a portfolio?

Yeah, so we like royalties because where we're investing, we're underwriting purely the yield.

So in every other asset class to generate a return, you're either reliant on interest rates, which we're not, or you're reliant on exits to generate the returns.

We've actually gone one step further, which is we have an IC philosophy where which is if we can't make our target returns on a buy and hold basis only we don't even discuss the investment in the investment committee so we're kind of sat here a little bit agnostic in terms of what's going on in exit markets or interest rates because our returns are just not driven by them we're ultimately trying to provide our investors top line revenue exposure to best in class products which we view as not necessarily being counter cyclical but being very resilient because ultimately whether work is going well or badly you will listen to music whether the markets are going up or down, you will still buy the healthcare treatments you're looking to buy.

So we're trying to provide very reliable income that people can count on.

The second part of it is because we don't fund costs, we don't suffer from cost inflation.

And if there is cost inflation, our margin isn't impacted.

Okay, now we've been talking about the fact that in a sense it's broadly, I was going to say defensive, you may not like that term, but I'm just interested with the different classes, if we think of three, health, commodities and entertainment, when you're talking about investing in musicians like The Weeknd and movies like Dark Knight, Hunger Games, et cetera, which we all know about, do they over the long term have a higher or lower return than commodities vis-a-vis healthcare?

so is that one of the big advantages is steady cash flow broadly, investing in royalties? What are the other key advantages of it? And then where does it fit into a portfolio?

Yeah, so we like royalties because where we're investing, we're underwriting purely the yield.

So in every other asset class to generate a return, you're either reliant on interest rates, which we're not, or you're reliant on exits to generate the returns.

We've actually gone one step further, which is we have an IC philosophy where which is if we can't make our target returns on a buy and hold basis only we don't even discuss the investment in the investment committee so we're kind of sat here a little bit agnostic in terms of what's going on in exit markets or interest rates because our returns are just not driven by them we're ultimately trying to provide our investors top line revenue exposure to best in class products which we view as not necessarily being counter cyclical but being very resilient because ultimately whether work is going well or badly you will listen to music whether the markets are going up or down, you will still buy the healthcare treatments you're looking to buy.

So we're trying to provide very reliable income that people can count on.

The second part of it is because we don't fund costs, we don't suffer from cost inflation.

And if there is cost inflation, our margin isn't impacted.

Okay, now we've been talking about the fact that in a sense it's broadly, I was going to say defensive, you may not like that term, but I'm just interested with the different classes, if we think of three, health, commodities and entertainment, when you're talking about investing in musicians like The Weeknd and movies like Dark Knight, Hunger Games, et cetera, which we all know about, do they over the long term have a higher or lower return than commodities vis-a-vis healthcare?

So going back to something you alluded to earlier, why would someone be interested in selling off a future royalty stream?

Yeah, so it's various reasons.

If you look at the healthcare space, we're typically buying the royalties from the original inventors.

So universities, small R&D, they create the IP.

They then enter into a license agreement with a big pharma company who then takes over in terms of the manufacturing, the distribution.

They brand it as their own big pharma product, and then they sell it.

And in return for being allowed to use the IP, they will enter into a license agreement where they will agree a royalty to the original inventor, such that every time the product is sold, the original inventor benefits from the sales.

Where do royalties fit into a typical portfolio that might have large exposures to both those asset classes?