Legendary rock superstar David Bowie died this week at the age of 69, after an 18-month long battle with cancer. Bowie’s health problems had been such a well-kept secret, that throughout his declining health, he was recording his final album, Blackstar, which dropped on his 69th birthday. Two days later, he was gone. His passing took the world by such surprise that it literally broke the internet—so many people were streaming David Bowie albums all day long that it was causing critical internet traffic failures in Chicago and Atlanta.
For Bowie to disrupt the internet, of all things, with his passing seems about right. He had spent his entire career doing the unusual and the offbeat, often way ahead of his time. He is called a rock pioneer not for any one thing he did, but for having such a sustained legacy of trying new things and breaking new ground. For him, that was his normal; doing what nobody else was.
Just one of these things was the “Bowie bond,” an early asset-based security launched in 1997. Conceived by investment banker David Pullman, the bond paid Bowie $55 million up front for a 10-year forfeiture of any royalties he would earn on his entire back catalog of songs published up to 1990. By that point, Bowie was already a legend, and had put out nearly 300 songs across 25 albums, with enough staying power to be considered a safe investment, even when giving a 7.9% return.
How safe were the Bowie bonds considered to be? Safe enough that Prudential Insurance—not known for having a huge appetite for exotic investments—bought the entire bond issue. For Bowie, who needed the money for tax and estate planning purposes, the sale was a huge boon, especially since he knew he would continue producing new product for years to come.
When news of the Bowie bonds broke, it generated interest in other celebrity bonds based on back catalogs of IP, mainly music. None hit the level of the original Bowie bond, especially since not long after the bonds issued, their value fell to junk status. The rise of the World Wide Web and digital music (especially the piracy of it) turned the music industry upside down, and the flow of royalties diminished.
Ultimately, the Bowie bonds paid out 10 years later, by which time Apple was celebrating the sale of its 100 millionth iPod. The timing of it all makes one wonder if maybe Bowie sold those future royalties because he knew something that few others did. After all, being ahead of the curve was what Bowie did on any number of artistic fronts; maybe he was ahead on a business front this time, too. Maybe he saw something coming that would jeopardize his living. The MP3 format was released in 1995, a good two years before his bond issue, and even though Napster—the infamous file-sharing service that would become synonymous with music piracy—would not launch until 1999, the writing was on the wall for anyone who cared to see it: the traditional model of music publishing and distribution was about to be destroyed, perhaps by illegal means, perhaps by legal means, perhaps by both. But whatever was coming, it was certainly going to be an asteroid-versus-the-dinosaurs kind of moment. By issuing bonds on his future royalties, Bowie got ahead of that in a big way.
People are still posting Bowie tributes of one kind of another online at a breakneck pace, and even by the incredibly short half-life standard of modern internet trends, the Bowie vigil will probably continue for a while. As my fellow editor (and bona fide David Bowie fan) Joe Mont pointed out, a lot of folks mourning Bowie’s passage were never huge fans of his to begin with. They just recognize that a titanic artist has come and gone, and feel the urge to mark this moment in time by noting however Bowie impacted them. That was the thing with Bowie; not everybody knew all of his material, but just about everybody had enjoyed at least one of the songs he published or one of the movies in which he appeared. My favorite is his legendary duet with Freddie Mercury on “Under Pressure.” But a close second? The Bowie bond. That’s my kind of greatest hit.