Backstage Pass / Royalty Network 20th Anniversary: How a Song Makes Money Forever

The Royalty Network's Frank Liwall moved from accouting to hitmaking by signing writers for Beyoncé, Ed Sheeran and Ariana Grande.

What could Robert Flack's classic love song "The First Time Ever I Saw Your Face" possibly have in common with Carl Douglas' disco novelty hit "Kung Fu Fighting?" As it turns out, both are copyrights represented by the Royalty Network, which Frank Liwall and his wife Kathy set up two decades ago, to offer songwriters worldwide representation at competitive rates.

The firm got its start in the modest Brooklyn neighborhood of Gravesend. Now with offices in Manhattan and the Los Angeles community of Valley Village, the Royalty Network has little need to be modest. The company is celebrating its 20th anniversary this year and serves as publisher or administrator for songs including:

• "Grown Woman," recorded by Beyoncé and released as a bonus video on her 2013 self-titled album, co-written by a team that included Beyoncé and writer Darryl Pearson, whom the Royalty Network represents.

• "Lego House," released as a single by Ed Sheeran from his 2011 hit debut album +, and "Thinking Out Loud," from Sheeran's 2014 ­follow-up x, with composing credits, respectively, from writers Jake Gosling and Amy Wadge.

• "Honeymoon Avenue," which appears on Ariana Grande's 2013 album Yours Truly, ­written by a team including writer Maurice Wade, represented by the Royalty Network.

• And such evergreens as Flack's gem, which won the Grammy for record of the year and song of the year in 1972 and Douglas' 1974 chart-topping disco favorite. American Idol licensed the former while a Wendy's ad and the show Parks & Recreation recently licensed the latter.

Those are just highlights of the 65,000 compositions that the Royalty Network, with a staff of 16, is actively marketing on behalf of some 600 clients, including 325 active songwriters. In all, there are 200,000 tunes in the Royalty Network's system.

"Our job is to build the value of the catalog by collecting income from around the world and turn around that revenue stream to the artist as soon as possible," says Liwall, 48, whose roster includes such songwriters as Shaggy, Lil Mo, Morgan Taylor Reid, Danny Brown, Jay Sean and the Dead Prez.

Evergreen hits can generate total licensing fees of $250,000 to $350,00 per year. The fees for one deal may range from free ("where it's a cause that the writer/artist truly believes in," says Liwall) to $150,000 to $250,000 for films or ad campaigns.

"The American fans love my song 'Kung Fu Fighting,' " says Douglas. "So I'm grateful to be working with Frank Liwall, who has a good track record and knowledge of the American market."

"Frank is one of the good guys, a fellow independent music publisher and a top administrator," adds Sarah Liversedge Platz, managing director of BDi Music and Bucks Music Group, which publishes songs by Sheeran's collaborators and newcomer Findlay.

Firms that focus on administration, like the Royalty Network, mainly collect revenue for songwriters who own their publishing. Typically, these companies charge 10 to 15 percent for supervising income streams -- far less than traditional publishers, who generally claim a 50 percent cut (or 25 percent as a co-publisher) because they also offer creative services and synchronization opportunities. Like other indie music publishers, the Royalty Network uses a web of subpublishers around the world to represent its writers in those locales.

Liwall had gone to school to be an accountant "because I loved numbers," he says. "But eventually I found accounting a bit too dry." He landed his first entertainment business job as an auditor at Good Times Entertainment. Liwall moved on to the Harry Fox Agency, the mechanical-rights clearinghouse, where he also did audits. But he realized he could use his skills to be an entrepreneur.

By 2000, when the Royalty Network had about 100 clients and 5,000 songs, the company began expanding its portfolio by trying to place songs on albums and landing synch deals in commercials, film and TV shows. As it added publisher services, the Royalty Network opened its West Coast office, headed for the past 15 years by Steven Weber.

The company's mission remained creating music usage opportunities that would "build the value of the songwriter's assets," says Liwall.

The Royalty Network used web technology to stand apart. "Very early on we integrated our website with our accounting systems," he says. "Each songwriter had their own log-on so they could see their earnings and even view historical statements, as well as compile data for different time periods."

Since it had been providing many full-fledged publishing services, about eight years ago the Royalty Network decided to take the plunge and start accepting co-publishing deals. "The entry price in publishing came down when the major publishers started out paying less" in terms of advances and deal points, Liwall says.

But, he adds, his firm is selective about who it takes on. "Not every writer is perfect for our system," says Liwall. "We choose to work with quality writers who understand the value of an active independent publisher."

One of the first things the company did was build up its synch team to try to offset the drop in mechanical royalties from album sales with a rise in synch income from the use of songs in film, TV, ads and more. "When mechanical income fell off the table," Liwall says, "we were in a position not to be crushed because our increased synch earnings compensated for the falloff in mechanicals."

But even as the Royalty Network widened its scope, it found that its initial focus remained important for the unfolding digital world and the billions of micro-penny transactions that come with it. While the company initially built its own tracking systems, it has since transitioned to the widely used Counterpoint royalty administration system, which it has customized.

The firm's portal not only allows songwriters to see statements and download data, it also now allows them to check out the details of projects the Royalty Network is pursuing on their behalf, and even request advances that would get them the money the next day.

That type of service, says Liwall, has built up word-of-mouth and referrals to other ­songwriters and helped the Royalty Network to expand its ­talent roster.

The company reports a steady stream of new signings across a wide range of genres. "We definitely market ourselves on our personal commitment to songwriters," he says. "So I am focused on making sure we are well-staffed and can handle our commitments. It's not about the number of the clients we take on; it's about the quality of service we can deliver them.

"We invest in our songwriters," adds Liwall, "and want them to afford the best equipment so they can build their own studio and write songs that will keep the wheels turning. We need fresh content so we can turn it into fresh revenue."