How do I check a video production company’s music and stock footage licences?
Pick a sample of delivered videos and ask to see the music and stock licence behind each one. Check that the licence covers the use the client was given, such as platform, region and length of use, and see whose name the subscriptions and accounts are under.
Licences are paperwork that few studios keep tidy, so test it. Choose a dozen delivered projects, a mix of old and recent, and ask for the track and clip details used in each. Then ask for the licence document that matches. Anything without a clear match is a question for the seller.
Read the scope. Some licences cover a single project, others a single use such as online only or broadcast. Ask whether videos were later cut down, reused or repurposed for different channels. If a client paid for advertising use and the licence covers less, the problem could come back to the new owner.
Look at accounts. Stock subscriptions and music libraries are often held in an editor’s personal name or on a card that is not the company’s. Ask who holds the logins and whether they transfer. Also check what the studio tells clients. Do proposals state what rights are included? Ask how expiring licences are tracked. Your lawyer is the person to say what the documents mean for you. Ask the seller to sort out any gaps before closing, or to say who bears the risk afterwards.
Key takeaways
- Sample delivered videos and match each to the music and stock licence used.
- Read each licence’s scope against how the client actually used the video.
- Find out whose name the library accounts and logins are under.
- Ask how expiring licences are tracked and what clients were told.
Related reading
15 pages on the same subject, grouped by topic.
Due diligence
- Expert answerHow do I find out who owns the footage archive of a video production company?
- Expert answerWhat do outstanding final-cut approvals say about a video production company’s cash flow?
- Expert answerWhat should I ask about a flooring company’s showroom samples and display stock?
- Expert answerWhat should I look at in a garage door company’s spring and opener stock?
- Expert answerHow do I judge the lumpy project calendar of a video production company?
- Expert answerHow do I verify a video production company’s equipment ownership and rentals?
- Expert answerHow do I check a video production company’s unbilled projects at closing?
Buying
- Expert answerWhy does a video production company’s gear rental income matter to a buyer?
- Expert answerWhat camera, lighting and editing gear should I verify when buying a video production company?
- Expert answerDoes a share purchase avoid transferring a company’s licences?
- Expert answerHow do I check a video production company’s insurance for gear and shoots?
Selling
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
Deavo is an advertising and listings platform, not a brokerage, law firm or valuation firm. This page is general information, not legal, tax, accounting or valuation advice, and rules differ by province. Confirm anything you rely on with a qualified professional before you act on it.