Music Business Monday #1 (How Record Labels Work)

Along with my Songwriting Tip of the Week Wednesdays and my Social Media Saturdays, I'm going to start doing Music Business Mondays!

To get the ball rolling, for this first week I'm going to discuss record labels.  If you're already in the industry and think it is a silly topic, I understand, but I think there is a huge common misconception the general public has about record labels and how deals work.

I've often heard the phrase "A record label is just a bank with knowledge," and there is some truth behind that statement.  Record labels have the money to get projects rolling, and the right connections to pass the project on to the masses.

To get started with a record label, you have to go through A&R, they are the gate keepers.  Artists and Repertoire in a nutshell is the department that finds new talent and brings them to the label.  So get in good with these guys!

The next part can differ depending on the type of deal you have and how much creative freedom you have as an artist.  You might get to choose your songs, your brand, your band, your producer, etc.  Or the record label might get to pick all of it for you.  Some deals have artist development where they hone your skills for awhile before releasing anything, and some record labels only sign artists that already have a solid fan base.  Details are tricky and contracts are long.  Word of advice---never sign anything without a lawyer!

Something that is commonly misunderstood and fairly universal when it comes to record deals, is the advance.  One might look at a record deal and think WOW they're giving me $200k for this album! Yes, that is what it looks like.  But realize that that money will go towards the cost of your album, paying for catering, the producer, the band, the money you will be living on, etc. If an artist spends all of this money, one might think, that's fine, their album will be out soon and then can live off of that money! Actually....they can't.  It is called an advance because the record label is just "lending" you the money.  The artist will not see a penny of the money made on their album until the record label's $200k is paid back in full.  Luckily, if they never reach $200k, the artist doesn't have to pay it back, but they can pretty much guarantee that the label won't be releasing another album of theirs and risking another loss.