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Fiduciary Checklist for Trustee Decisions About Investing in Media and Creative Businesses

UUnknown

2026-02-16

11 min read

A sector‑specific fiduciary checklist for trustees considering media, production or creative investments—focus on IP, talent, revenue and restructuring history.

Trustee Checklist for Investing Trust Capital in Media & Creative Businesses — Why Sector‑Specific Due Diligence Matters in 2026

Hook: Trustees face a unique fiduciary dilemma: media and creative businesses can promise fast growth and cultural impact but carry concentrated talent, intellectual property entanglement, and volatile revenue models. If you are considering deploying trust capital into a production company, digital publisher, studio or creative services firm, this sector‑specific checklist is designed to satisfy your duty of care, defend against compliance risk, and structure investments for liquidity and protectability.

Top takeaway (inverted pyramid):

Before any trust commits capital, require a three‑tier process: rapid screening, targeted sector deep‑dive, and legally enforceable investment terms. In early 2026, with media firms like Vice Media reinventing themselves post‑restructuring and regulatory pressure around AI content tools and content rights mounting, trustees must prioritize intellectual property clarity, talent risk mitigation, revenue diversification, and a clear record of restructuring history.

Why 2026 changes the equation

Recent industry moves—digital publishers and production houses pivoting toward studio models, senior hires in finance and strategy across media companies (notably Vice Media’s post‑bankruptcy C‑suite rebuild in late 2025/early 2026)—underscore two realities. First, experienced operators are being recruited to re‑scale previously distressed brands. Second, platform consolidation, ad market normalization and the proliferation of AI‑generated content have changed both risk profiles and value levers. Trustees must evaluate not only present cashflows but also the company’s ability to navigate regulatory scrutiny, union obligations and AI‑generated content exposure.

How fiduciary duty frames media investment decisions

Trustees are bound by duty of prudence, loyalty and impartiality. Investing trust assets in media requires an explicit record that you:

Assess investment suitability against trust terms and beneficiary needs;
Document objective, expert‑based due diligence steps;
Ensure diversification and liquidity consistent with the Uniform Prudent Investor Act (UPIA) and state fiduciary standards;
Obtain independent valuations and specialist advice when exposure is non‑standard.

Three‑stage process every trustee must use

Stage 1 — Rapid Screening (0–2 weeks): Quick filters to decide whether to proceed. Focus on red flags such as unresolved bankruptcy litigation, missing IP ownership chain, or single‑person dependency.
Stage 2 — Deep Due Diligence (2–8 weeks): Full sector checklist (detailed below) covering financial, IP, talent, contracts, regulatory and market analysis.
Stage 3 — Structuring & Documentation (4–12 weeks): Negotiated protections: representations and warranties, escrow/holdbacks, earnouts, governance rights, insurance and exit triggers. Obtain sign‑off from independent counsel and a specialist valuation expert.

Comprehensive due diligence checklist — sector focus

A. Revenue models & commercial risk

Media and creative firms rarely rely on a single predictable cashflow. Trustees must map and stress‑test all revenue streams.

Revenue breakdown: Advertising, subscriptions, syndication/licensing, production services, branded content, event revenues, merchandising, and government/grant income. Request a three‑year and trailing 12‑month (TTM) breakdown by revenue stream and client concentration.
Customer concentration: Identify top 10 clients or platforms that produce >50% of revenue. Assess platform risk (e.g., reliance on a single distributor or social platform).
Recurring vs. project revenue: Quantify recurring revenue (subscriptions, retainer deals). Project revenue (one‑off productions) has higher volatility—model scenarios for cancellations and reorder delays.
Monetization diversification plan: Does management have a credible path to diversify—licensing catalogs, studio services, IP franchising, direct‑to‑consumer products?
Unit economics: If subscription or creator monetization is material, get CAC, LTV, churn rates, take rates, and margin per production.
Ad market dependency: For advertising‑driven models, stress test against a 20–40% ad contraction scenario (reflects late‑2025 advertiser pullbacks and 2026 performance allocation shifts).

B. Intellectual property (IP) and content rights

IP is often the crown jewel of media businesses—but it is only valuable if the ownership is clear and the rights are transferable.

IP chain of title: Request executed assignments, license agreements, and documentation for every major title, format and library asset. Check for third‑party content embedded under license.
Copyright registrations: Confirm registrations where available and note jurisdictions. For pre‑existing works, confirm written assignments from creators or work‑for‑hire agreements.
License scope and term: Are licenses exclusive, perpetual, worldwide? Identify reversion triggers and termination rights.
Clearance & third‑party rights: Music, stock footage, trademarks, and likeness releases must be cleared and indemnified. Identify any ongoing royalty obligations.
AI provenance risk: As of 2026, AI‑assisted content increases copyright disputes. Confirm whether any content was generated using third‑party models and whether training data exposure creates infringement risk.
IP valuation and monetization plan: Assess whether the company can meaningfully monetize the library (licensing windows, format sales, syndication, merchandising).

C. Talent risk & key‑person exposure

Creative and on‑screen talent can be the primary asset—or the primary liability.

Key‑person inventory: List executives, creators, stars and producers whose departure would materially impact revenue or distribution deals.
Contract review: Examine employment agreements, talent deals, exclusivity clauses, non‑competes (where enforceable), deferred compensation and residual arrangements.
Union and guild obligations: Verify compliance with SAG‑AFTRA, WGA, DGA and local union contracts. Late‑2020s union expansions increased residual and pension obligations that can materially affect margins.
Retention and incentives: Do non‑compete and incentive packages align talent retention with investor returns? Consider escrowed retention pools or milestone‑based earnouts.
Reputation and conduct risk: Conduct social listening and reputational screening—brands and advertisers can quickly withdraw from controversial talent associations. Consider guidance on designing pages and messaging for controversial or bold content when reputational issues are material.

D. Restructuring history & legal encumbrances

Companies that have restructured or filed for bankruptcy present both repositioning opportunity and lingering legal and contractual obligations.

Bankruptcy/insolvency history: Obtain copies of filings, settlement terms, creditor payment plans and any ongoing litigation. Understand carve‑outs and preserved claims.
Debt covenants & secured creditors: Identify liens on IP or receivables. Confirm subordination and any change‑of‑control acceleration clauses.
Past M&A and roll‑ups: Examine historic asset transfers and whether any vendor or creator claims were preserved post‑restructure.
Litigation docket: Active or threatened suits—IP disputes, labor claims, tax audits, or creditor adversary proceedings—should be quantified and stress‑tested in valuation.

E. Financial statements, accounting policies & tax

Scrutinize the numbers with sector awareness: production accounting can be lumpy; capitalization policies can mask true performance.

Audited financials: Prefer 3 years of audited statements. If unaudited, demand a forensic review by an independent accounting firm.
Revenue recognition: Check how the company recognizes long‑term production contracts, licensing advances, and advertising revenue.
Capitalization policy: Are development costs capitalized or expensed? This materially affects reported profitability.
Receivables & backlog: Confirm collectability of major receivables and contracted future revenue (distribution agreements, licensing deals).
Tax attributes: Net operating losses (NOLs), transfer pricing issues, and residual tax liabilities can change returns—get tax counsel input.

F. Operations, technology & distribution

The business’s platform, CMS, rights management and distribution deals determine scalability and margin capture.

Distribution agreements: Territory rights, exclusivity, windowing, and minimum guarantees should be mapped.
Technology stack: IP management, rights tracking, DRM, and adtech. Vulnerabilities or unscalable tech can be acquisition‑killers.
Data ownership: User data, subscriber lists and CRM—confirm ownership, privacy compliance, and portability.
Operational scalability: Production capacity, freelance pools, and supplier relationships. Assess sensitivity to scale up or down quickly.

G. Market risk, competitive landscape & exit strategy

Understand the investment horizon and realistic exit pathways.

Market positioning: Is the firm a niche boutique, independent studio, digital publisher or creator platform? Each has distinct buyer pools.
Competitive threats: Consolidation among streamers, tech platforms and network studios can both raise strategic value and compress multiples.
Exit routes: Trade sale to a studio, strategic partnership, licensing monetization or IPO. For trusts, prefer exits aligned with beneficiary timelines.
Valuation assumptions: Run DCF with 3‑5 scenarios (base, downside, upside) and include sensitivity to churn, ad rates and key person loss.

Practical structuring protections for trustees

When you move from diligence to deal, incorporate enforceable protections tailored to media risk.

Representations & warranties: Robust IP, contract, tax and financial reps with survival periods adequate for content lifecycle risk.
Escrow & holdbacks: 10–25% escrow for 12–36 months tied to IP claims, tax, and talent contract integrity.
Indemnities and insurance: Secure IP indemnity from sellers and require E&O, cyber, D&O and key‑person insurance. Require insurer approval right.
Earnouts & milestone payments: Use performance‑based earnouts to align management and mitigate upfront overpayment risk.
Governance rights: Board observer seats, approval rights for significant asset dispositions, and information rights with monthly KPIs (revenue by stream, subscriber metrics, burn rate).
Change‑of‑control protections: Prevent accelerated vendor payments or deleveraging moves without investor consent.

Who to bring on: specialist advisors trustees must retain

Media deals require a cross‑disciplinary team. Trustees should budget for these advisors and document their reports in the trustee file.

Media & entertainment transactional counsel (IP and talent expertise)
Forensic accountant with production accounting experience
Independent valuation expert (content library specialist)
Labor and employment counsel (union expertise)
Technical/IP due diligence firm for rights management and AI provenance review
Reputation & ESG advisor when brand alignment or social risk is material

Red flags that should stop a trustee from investing

No clear chain of title to key IP assets.
Single client or platform accounting for >60% of revenue with short‑term contracts.
Key talent without enforceable retention or with imminent contract expiration.
Unquantified residual, pension or union obligations.
Active bankruptcy claims or undisclosed creditor liens on content libraries.
Lack of audited statements or refusal to allow third‑party verification.

Documenting the decision — fiduciary best practices

Trustees must create a contemporaneous record that shows reasoned analysis and reliance on expert advice:

Prepare a written investment memo summarizing findings, red flags, valuations and scenarios.
Attach third‑party expert reports, legal opinions and minutes of trustee deliberations.
If the trust instrument requires beneficiary consent for non‑traditional investments, obtain and archive written waivers.
Set monitoring covenants—require monthly KPI reports and quarterly board updates to preserve oversight.

Case study (inspired by Vice Media’s 2025–2026 pivot)

Several formerly digital‑native media companies entered restructuring in the early 2020s, then repositioned their business models in 2025–2026 as content studios and IP holders. One prominent example—Vice Media—bolstered its finance and strategy team post‑restructuring as it targeted studio and production capabilities. From a trustee perspective, such pivots emphasize three lessons:

Management upgrades can materially reduce execution risk, but require validation of track record and alignment mechanisms.
Restructuring can clear legacy liabilities but may leave behind contractual oddities—trustees must review settlement terms closely.
Pivoting firms often trade past subscriber‑centric metrics for longer lead time—but higher margin—licensing and production deals; stress testing is essential.

2026 trends trustees must monitor

AI & content provenance: Litigation risk and licensing requirements related to AI‑generated works are a growing exposure.
Platform consolidation: A smaller set of dominant distributors increases counterparty risk but can create larger strategic buyers.
Unionization & residual reforms: Expanded guild agreements are increasing fixed cost obligations.
Subscription fatigue and performance advertising: Monetization continues to shift—diversified revenue mixes are safer.

Actionable next steps for trustees (checklist you can implement today)

Do not approve media investments without an IP chain‑of‑title memo prepared by specialist IP counsel.
Require at least one independent valuation focused on content library economics and an accounting review of revenue recognition.
Insist on escrow/holdback and indemnity language tailored to IP and residual risk; set earnout milestones for management incentives.
Obtain key‑person insurance and require monthly KPI reporting covering revenue by stream, subscriber churn, and top client concentration.
Document the trustee’s rationale in a formal investment memo and obtain beneficiary waivers if the trust instrument requires it.

Trustee principle: When media deals look like home‑run growth, demand the documentation of every base hit that makes the home run credible.

Final considerations — balancing upside and duty

Media and creative investments can deliver asymmetric upside—brand‑defining IP and recurring licensing income—but they also present concentrated legal, talent, and market risks. As of early 2026, trustees must add sector‑specific scrutiny to standard fiduciary diligence: IP chain verification, talent contract robustness, restructuring legacy assessments, and revenue concentration stress testing. Where risks cannot be contractually mitigated or insured, trustees should limit exposures and prefer structured payouts (earnouts, holdbacks) that preserve downside protection for beneficiaries.

Call to action

If your trust is evaluating a media investment, do not rely on generic checklists. Contact trustees.online for a downloadable, customizable Media & Creative Business Due Diligence Pack including templates for IP audits, talent contract review checklists, sample escrow terms and an investment memo template built for trustee records. Protect your beneficiaries with sector‑aware diligence and enforceable deal protections.

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