Today on the podcast we start talking about your team. Specifically who makes up your team, why they matter, and we go in detail on the first member – the music industry attorney. You don’t want to miss this one.
In our first episode of the music industry podcast we are talking about the old music industry and how it differs from the industry today. If you are trying to make it in music, you don’t want to miss this!
Stay tuned for more episodes!
Why Your Team Is Important
The people you pick to be your professional team will, more than any other factor, determine whether or not you succeed in the music business.
If you have the right people on your team, you can focus on the part you love: writing music and performing while your team automatically moves you towards your goals like a self driving car. If you have the wrong people on your team, that self driving car will drive off a cliff
It is imperative that you get this right. Let me say that again. Choosing your team is the single most important decision you will make in your music career.
OK? Have I convinced you yet? I know I am being dramatic but choosing a good team is the most important thing a new artist can get right, and also the thing most new artists get wrong.
So why do new artists so frequently screw up when it comes to picking a good team? They don’t know how. This isn’t taught in school (often not even in music colleges) and there are not many good sources of information on the subject. (In fact the industry often benefits from there being so little information on team building, but that is another post). This blog exists because I am tired of seeing new artists with winning music and a losing team fail. I don’t want that to be YOU. So let’s change that, starting by learning who makes up a good team.
The People That Make Up Your Team
Ask any label and they will tell you that there are 4 Main Players on any musicians professional team.
- Music Industry Attorney
- Personal Manager
- Business Manager/CPA
If that doesn’t mean anything to you, don’t worry. We are now going to talk about each member in depth. By the end of this post you will have a general idea about what each team member does and how much you should expect to pay them.
Music Industry Attorney
When you think of a music industry attorney what do you imagine? Do you imagine a man or women in a suit behind a big wooden desk looking over X-factor contracts in a fancy office with ugly wallpaper?
Well I am here to tell you that lawyers in many ways are the most powerful groups in the music industry today. There is a reason that when asked “What advice would you give to ANYBODY who wants to be a musician, Taylor Swift said “Hire a Music Industry Attorney.” Music industry attorneys are so powerful because the power in the music business is decentralized relative to the rest of the music industry. In Hollywood, only clients of the major agencies are likely to get cast in major productions so they have the most power. In the music industry, agents have less influence. Personal managers may have a huge amount of power, in many aspects of the business but they can only manage a few acts at a time and that limits their pull. Business managers can have more clients than personal managers, but they have little power outside the financial realm. Music industry attorneys have the best of both the personal manager and business manager worlds; they can manage a lot of acts like business managers because they do not need to spend nearly as much time per act as a personal manager, but they also are not limited to just one part of the industry like business managers are.
Just like personal managers, industry attorneys partake in many parts of the music business, and just like business managers, they can have a lot of clients. This means that music industry attorneys put together and are put in front of more deals than any other group in the music industry. Because of this industry attorneys more about who is who and what is going on right now than any other group. They often have the power to decide or influence which companies get which deals and that means that everyone wants to keep them happy.
Lawyers in the music industry have many different types of fee structures, meaning there are different ways music industry lawyers can be paid. Usually this comes down to an hourly rate, a percentage, or some combination there of. Because Lawyer fees are so complicated there will be a separate blog post on it. But for now just know these two things.
- New music industry lawyers can charge $250 dollars an hour, and the best industry lawyers can charge $700 an hour or more.
- Lawyers who take a percentage will often take around 5% but some can take as high as 10%
- If you are brand new or unsolicited and the lawyer has no reason to believe that 5-10% of what you make as an artist will be equal to or higher than their hourly rate, expect to pay cash upfront.
While all of the 4 team positions can make or break your career, the personal manager is the one you most have to get right.
As you may expect, your teams business manager handles your teams money. They are usually responsible for collecting the money you earn, paying the people you owe, and investing and paying taxes with the rest. Many many famous artists have found themselves bankrupt due to an incompetent business manager. And it’s no wonder because in some states, Anyone can say they are a business manager without taking any tests, getting any certification or even taking any business classes!
Since most artists also have never taken business classes, they can fall for the bullshit and put a terrible businessman or business women in charge of their music career. With no protection from the bullshitters, it is no wonder that even some of the biggest stars have been led into bankruptcy by a bad business manager.
Luckily, you now know something many artists don’t. There is a badge worn by many of the best business managers. More importantly, this badge cannot be worn by the people who have never taken a business class. In fact, if you know to look for it you can be certain that your business manager understands business. He may suck at communication, she may be a bad business manager for other reasons, but any person who wears this badge understands business at a fundamental level.
So what is the badge? It’s called a CPA and anyone who earned it will proudly display it in their office, on their website, on their nameplates and on their door. CPAs (or Certified Public Accountants) have passed a rigorous accounting exam that consistently ranks as one of the Toughest Exams In The World To Pass. CPA’s also adhere to a strict code, the CPA code of ethics, which makes them the most trusted advisors of the rich and famous Most accountants and business managers do not pass the CPA exams. In fact, most that try will fail. Anyone who has done it has earned one of the highest levels of respect in the financial and business worlds. By looking for a CPA when you look for a business manager, you are helping to make sure that your career is in good hands.
Like lawyers, businesss managers can have many different fee structures including hourly rate, percentage, flat project fee or some combination there of. Most CPAs who work on percentage will want about 5%, however business managers have a lot of systems to set up for you before they can start, which costs time and money. As such, a lot of business managers will want a minimum fee of 2,000 to 5,000 a month and will not just take a chance and hope that you are hugely successful.
If your idea of a music agent is anything like the image of a Hollywood agent portrayed in movies or on Entourage, then STOP RIGHT NOW. While Agents in Hollywood may be powerful enough to put entire blockbuster movies together, in the music business agents mostly just book shows and live appearances. Music agents don’t put blockbuster albums together. They do not generally even take part in the recording process, songwriting, or artistic processes. They don’t do merch either.
What music agents do is fill your schedule with booked appearances, and the best of them are damn good at it.
The world of agents is ruled by unions. You probably have heard of SAG, the screen actors guild. While SAG always ruled Hollywood agents, music agents were historically ruled by AFTRA (American Federation of Televison and Radio Artists) and AFM (American Federation of Musicians). After a merger in 2012 SAG and AFTRA are now one entity, so the union that rules Hollywood agents now may rule your agent too.
Because unions rule the world of agents, agent fees are pretty standardized with a 10% cap enforced by the unions themselves. In some cases an agent goes lower, but you should never pay an agent more than 10%. (Exception college circuits which are 15-20%)
Also, remember above when I said that agents don’t participate in the recording process or songwriting? This means that you shouldn’t be giving them a percentage of the profits generated from those areas. Most agents won’t even ask for this but if you have an agent that wants a percentage of these sales then get out fast.
The music industry we have today is a very different place than the old music industry still portrayed as modern in movies and television.
In the old music industry, you had to make demos and network until the faithful day when a label would be willing to sign you and invest a million dollars or more of their hard earned money into your career. Even if you were signed, you would still have to get on your knees and pray that you get really lucky again and end up in the 10% of signed artists who actually turn a profit. (You heard me right, even in the peak of the music industry, only 10% of signed artists made money, the other 90% of signed musicians LEFT WITH LESS MONEY OR MORE DEBT THAN THEY HAD BEFORE THEY WERE SIGNED.)
There is a concept in economics called the Tyranny of Space and it ruled the music industry. The music stores only had so much space on their tables and shelves to display your CD. There was even less space on the air in the form of radio spins allotted for new artists. In the old music industry, you could have a great record charting in the Billboard Top 20, be touring all over and for all intents and purposes have “made it” only to lose your deal and be dropped because the label found someone in your niche with slightly better numbers, This is the Tyranny of Space. Lucky for you, with the rise of digital distribution, it died.
The old music industry can’t come to the phone right now. Why? Because it’s dead. Rejoice. With a decent computer and audio interface you can run the same recording software used by the best studios in the world. (Sound proof room not included but get over it.) The costs associated with making a record are much less expensive now and distribution barriers of entry went away when server memory became cheap. Better yet, Facebook ads are cheap and most of social media is free.
When the Tyranny of Space died, to some degree so did luck in the music business. You can write and record music you love without a label now. You can find your audience online without a label now. You can sell your music without a label now. You can crowdfund your projects or take on private investors and use other peoples money without a label now. And if you do that enough you can change what mainstream music sounds like, at which point a label will find you.
So How Do You Do It?
There is a new music industry in town and with it a new tyranny. The Tyranny of Too Much Space. (I know, we just can’t get it right.) Have you ever spent so much time on netflix trying to decide what you want to watch that you realize you could already be halfway through something by now? Nothing really stands out. This is the Tyranny of Too Much Space. When everybody is a blip on the radar, how do you separate yourself from the noise?
There are as many answers to this question as there are self proclaimed experts on the music industry. I believe it is 20% making good music, the best product you can, and 80% making a good business, running the best enterprise you can. If you are a musician in the new music industry, or want to become a part of the new music industry, then you are a business. So it is time to keep reading, to keep improving, and to start acting like the business you are.
The Real Reason People Move To New York
9/11/2017 Reading Time: 3 Minutes
Given what day it is, I thought that now would be a good time to do this.
“You don’t move to New York to do Nothing.”
I said to Bryan as I began packing my book bag with random goodies from a college welcome week Spin Doctors concert.
“It’s too fucking expensive. A day binging netflix costs like 200 dollars there.”
I spoke with a lot of authority about New York considering I hadn’t put the 10 years of living there required to be a New Yorker. I was, however, in the process of moving to the Big Apple and as far as I was concerned that made me an expert.
(Insert Picture of Crude Crayon drawing that says “Richie Sater, Expert On All Things New York”, Caption: Exhibit A)
I continued to wax poetically about the city and the faces there that “tell stories” as I finished packing. Then I hugged my friend and frat brother goodbye and drove to my sisters house to grab my suitcase and get dropped off at the airport.
Do you my dear reader want to know the real reason why people move to New York?
Despite a 5 minute delay consisting of a TSA agent using the back of his hand to rub my groin because I insist on wearing Fear of God Denim that always sets off the metal detector– I made it to the gate with over an hour to spare.
RDU to JFK is not a long flight, and it is one I had made many times before, so I had a book; I Can’t Make This Up by Kevin Hart and Neil Strauss, ready to go. I didn’t get to read it though because, almost as soon as I sat down, another Frat Brother showed up also flying to the city. He invited me to hang out at the bloomberg building the next day with some of the engineers building the bloomberg terminal. This is why frat’s are important I told myself.
It’s a few days later now, and I am mostly moved in. I will bore you with the details about how my uber driver had an M.B.A and the move itself some other time. For now I promised you the real reason why people move to New York.
The math majors among you who excel at counting may have noticed that this is my very first blog post. It is no accident that this is happening in coordination with a big move. Moving is associated with change and change is an opportunity to reinvent oneself, or simply add a few good habits if you already like who you are.
But why do people come specifically to New York City?
When a recent Pew Research poll asked Americans about different cities and whether or not they’d like to live there, 45 percent of the people under 35 said they’d like to live in New York. So if you’re already here, roughly half of young America would happily switch places with you right now. And the reason for that is F.O.M.O
F.O.M.O is an abbreviation us cool young cats who are obsessed with snapchat use to abbreviate the Fear of Missing Out. People that move to New York City moved because they weren’t content living somewhere else. We saw what life would have looked like if we had stayed put and it terrified us. There is a preconception that moving to New York will make you more interesting and give you the life experience necessary to be the kind of individual that is envied by those who stayed. If you have F.O.M.O you see this preconception and realize that moving to NYC is a way of forcing yourself into being part of the conversation; which is at the core of what anyone experiencing F.O.M.O wants.
I told my mother about a year ago that one of the things I want most out of life is to live a good story, I don’t really care if anyone reads it or not, I just want to have lived it. I think this is why I read so many biographies. I’m obsessed with the idea of my life being a good story. But this is a form of F.O.M.O and it is why I moved to New York City last week. I’ll let you know if it works.