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Music Business Contracts: 7 ways artists get screwed every time!



No artist wants to get screwed with a contract. That’s everybody’s fear, right? The problem is if you knew where the screw points were, you’d feel more comfortable doing business. No artist should go through this, which is why I’m going to give you seven places you should look before getting bent over a desk.


Damage Points

Artists get screwed all the time in record deals and agreements. There are many points where a good screwing can happen, but it's a matter of how many damage points an artist suffers.


Record Deal - Additional Recordings

Additional recordings during your album period are a tactic used to increase the record label’s catalog without having the extra recordings count against your deliverables. A company can misuse these if your album doesn’t do well and they need a pick-up in momentum or if they need some momentum before your album drops. If this happens, you want to push to add the additional recorded songs to the main album.


Record Deal - Premature Exit Clause

If the record company does not do its job and your recoupment amount is under 30% plus other metrics, you should add an exit clause to combat negligence and underperformance against the record label. This holds their feet to the fire. Use mogul.com as a great tool to pre-audit your record company.


Record Deal - Indie Deal with No Recording/Marketing Budget

Sometimes small record labels can’t afford an artist advance, and that’s okay; it means less money for you to recoup. However, if the label doesn’t have money to produce or market the product, you’re in for the most wasted time of your life.


Record Deal - Wasted Time

Time doesn't wait for anybody, and we’re all getting older each day. Time is a significant factor in your deal. It dictates your reasoning and strength to work certain tasks. Though this isn’t a clause, if your record label is wasting time because they don’t have the money to keep going, then your exit clause needs to be that much stronger against indie labels who just don’t have the budget.


Producer Contract - Producer Royalty

Artists, whether major or indie, often overcompensate producers because they don’t know their artist royalty amount and the threshold for paying people a royalty from their audio products (i.e., single, album). Rule of thumb: 25% of the artist royalty is used to pay everybody that requires a royalty. DO NOT GIVE YOUR PRODUCER a 50% ROYALTY! 3% is standard, and 4-5%+ if you paid less for the beat or your producer is a full-rate producer.


Split Sheet - 50% Again!!!

Artists who write should know how to fill one of these out. The major screw point is giving a beatmaker 50% on a non-leased beat. You’ve potentially still got other writers, co-producers, vocal producers, and arrangers to split with. If 50% is gone, guess who’s giving the rest?


Split Sheet - “I Don’t Do Split Sheets”

The second major screw point is when a producer says they can't work with anybody who mentions this during the creative process. This person is either underwater on their publishing deal and needs a bigger share to make up for their losses with the publishing company or trying to screw you later when there is no memory of what happened. Check out the one-of-a-kind master & publishing split sheet on my store. It comes with a free walkthrough course.


When Is the Right Time to Address Split Sheets?

Before the session, ask for everyone’s PRO information so it’s not awkward. If it is awkward already, then you know where your potential problem sources are.


How Do I Know if an Indie Label Has No Money?

It will say it in the contract, but if they don’t send the contract to your lawyer or ask who your lawyer is so they can send a copy, you already know what time it is.


Where Does the Money for the Additional Recordings Come From?

It comes from the album budget or a discretionary fund. This is why you want to watch how many recordings are requested outside of the album.


I Thought I Was Supposed to Give the Producer 50% of the Song?

First off, you’re not supposed to give anybody anything. Secondly, “song” and “record” are two different terminologies in this business. Any producer who pressures you to give them 50% of the “song” but means “record” is inexperienced. 50% of the “song” (publishing) is okay. 50% of the “record” (master) is not okay.



Check This Out!

If you're a music creative or executive looking to build your label or publishing company in 60 days or less, with a step-by-step foolproof process, grab the 60-Day Record Label Course and get it done today! You’ll gain the ability to get real funding, avoid contractual pitfalls, and keep the middleman out of your pockets. Click the link below to get started now! If you’re skeptical, grab the free guide, "10 Ways to Increase Your Record Label Profits," which comes with a free split sheet download.


Learning the Mechanics of This Business via Contracts

Learning the mechanics of the music business through contracts helps you navigate much faster than those trying to get in the game fast, cheap, and easy. It helps you avoid time-wasters, nobodies, and clout chasers. If you were starting a cookie business, you wouldn’t start it fast, easy, and cheap. So why do you think heavy progress will be made fast, easy, and cheap in the music business?


Not Learning the Mechanics of This Business via Contracts

Not learning the mechanics puts you deep in the sauce, causing you to take a heavy beating versus a lighter one. It also causes you to waste time with nobodies and clout chasers. If your goal is to grow, why would you waste time doing it?


Conclusion

If you were trying to avoid getting bent over a desk, you now have more tips to avoid that. For more insights, check out the video, The Heated Rift between Music Producers and Artists in 2023.

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