Resale and Secondary Markets: Don’t Leave Money on the Table

You’ve poured your heart into a painting, a song, or a sleek digital design, and someone loves it enough to pay you for it. Victory, right? But months later, you find out they resold your work—for ten times the price. Do you see a dime of that? Probably not. That’s the uncomfortable truth about resale and secondary markets for creators.

But here’s the thing: it doesn’t have to be this way. With a little foresight and the right strategies, you can protect your rights and ensure you’re part of the financial conversation long after the initial sale. Let’s break it down.

What Are Resale Royalties, and Why Should You Care?

Ever heard of the droit de suite? It’s a fancy French term for resale royalties—a legal concept that entitles artists to a cut of the profit every time their work is resold. Sounds dreamy, right? Well, it’s not universal. In the U.S., for instance, federal law doesn’t mandate resale royalties, though a few states, like California, have tried to implement them.

So, why does this matter to you? Because resale royalties can mean passive income. Imagine your early works gaining value as your reputation grows. Without protections in place, someone else pockets the appreciation while you’re left clapping from the sidelines.

Digital Assets: The Game Changer

Now, let’s talk about digital assets—NFTs, to be precise. These shiny little tokens have flipped the script on resale rights. Unlike traditional art or music, many NFT platforms, like OpenSea or Rarible, allow creators to bake resale royalties into the smart contract. It’s like putting a little “pay me later” button directly into the sale.

But don’t get too comfortable—tracking resales in the digital realm isn’t always straightforward. Some buyers transfer assets off-platform, dodging the automated royalty systems. This means you might need to get a little tech-savvy to monitor your work’s journey through the secondary market. Tools like Etherscan or specialized blockchain trackers can help you keep tabs on your digital creations.

Contracts: Your Best Defense

Let’s get real: contracts are your safety net. If you’re licensing your work or negotiating with buyers, include a clause addressing secondary sales. Spell out your entitlement to a percentage of future sales, and don’t shy away from negotiating—your future self will thank you.

For example, if you’re selling a painting or licensing a song, consider including terms like, “The creator retains 10% of all resale profits.” Sure, it might feel awkward at first, but think of it as setting boundaries. Would you let someone borrow your car indefinitely without discussing gas money? Probably not.

The High Stakes of High Resales

Here’s a scenario: Your work gets resold at a higher price—way higher. You feel flattered, but also a little cheated, right? This isn’t just about money (though, let’s be honest, it’s mostly about money). It’s about recognizing the value of your labor and talent.

Knowing your rights in these situations can help. In some jurisdictions, you can argue for a cut if the sale breaches existing agreements. And if your work is digital, tracking the sale through blockchain records can provide leverage. But the key is to be proactive—don’t wait until you’re watching someone else profit from your genius to act.

Tools to Keep You in the Loop

You wouldn’t leave your front door unlocked, would you? Similarly, don’t let your work wander off into secondary markets without supervision. Consider registering your creations with platforms that monitor resales, such as:

These tools aren’t just about tracking—they’re about staying in control.

A Tangent Worth Mentioning: The Psychology of Pricing

Quick side note: Ever notice how some creators set sky-high prices for their work? It’s not just ego—it’s strategy. High initial pricing can deter resellers from flipping your work for a quick profit. Plus, it sets a tone: “This is valuable.”

That said, pricing is tricky. Too high, and you might scare off buyers. Too low, and you invite a flood of resales. Striking the balance is an art in itself.

Wrapping It All Up: Protect Your Prosperity

Here’s the takeaway: Resale and secondary markets can either be a headache or a goldmine, depending on how you play your cards. Know your rights, use smart contracts, and lean on tools and clauses to keep your creations working for you—not just the person who bought them.

Because at the end of the day (oops, scratch that—let’s rephrase), when all’s said and done, your creativity deserves to be rewarded, not just once, but every time someone profits from it. So, go forth, create, and don’t let anyone shortchange your brilliance.

Mitch Jackson | links