Your Music is About to Get Real
By T. Perry Bowers
There are some people in this world who prepare for everything. They have their business cards printed before they even have their first client. They get their business license before they get any business and they prepare for worse-case scenarios before they close one deal. People like this bug me. I’ve always felt you should be transacting money before you call yourself a business. There’s no use getting all of the peripherals in order before you conduct some business. Or is there?
I recorded ten bands before I was registered with the state. At some point someone told me that I should create an LLC (a limited liability company). It’s a business structure that protects your personal assets — so if someone sues you in business, they can’t come after your personal stuff. It cost me about two hundred bucks back then.
The main reason you register your business with the state (or the feds for that matter) is so you can create deductions on your tax forms. However you can also do this under your social security number. The “official” stuff doesn’t really matter until you are creating an income. Once the money is flowing, it makes sense to get your legalities tight.
However if you have a partner (or an entire band) it is sensible to lock everything down up front. Bands need to make clear agreements and write them down, preferably with an attorney.
Unfortunately nothing changes people’s views faster than money. Agreements and understandings that seemed solid when you were playing a few songs in the basement can shift when the cash suddenly starts rolling in. Big questions start arising — Who did most of the work? Whose idea was it? Who made the most connections? Who closed the biggest deals?
If you don’t have clear agreements up front, things can get sticky. Agreements can always be re-negotiated at any point — they should create an open dialogue as you conduct your business along the way. But if things go haywire, agreements give the partners a framework to dissolve or re-structure the business.
I recently had a discussion with a young artist. He and his long-time musical collaborator are going into the studio this summer with a well-known producer to track and mix a couple of songs and try to create some industry interest.
This young artists’ partner is the main song writer. I asked him if he had any songwriting/publishing agreements in place. He said he would have that discussion with his partner at some point before the album was released. I must admit I got a bit frustrated at this — I may have raised my voice! My point is he needs to get this all locked down before he enters the studio. The time to create agreements in a partnership is before anything happens.
Imagine this scenario. Two musical partners go into the studio and cut some great tracks. The main songwriter feels he has created ninety percent of the work. The other partner thinks he has created maybe fifty percent of the work. But, neither of them have ever said anything out loud about their thoughts.
The producer has them fill out copyright and publishing forms. No question, there is going to be a heated debate now. One that could create a huge wedge in their partnership. More than likely the one who feels that he is doing ninety percent of the work is going to walk away from signing anything. Why would he give up his percentage when is he is doing the lion’s share of the writing (at least in his own mind)?
If you’re the side man in this scenario, you’d better get ahead of this. If you feel like you’re contributing a lot to your project, you need to tell your musical partner. Often the main songwriter feels like they could do it themselves. Sometimes that’s true (think Sting, Don Henley, Peter Gabriel). Sometimes, it’s not true though. Mick Jagger isn’t much without the Stones. Axl Rose can’t write a song to save his life without Slash.
If you’re the main songwriter, don’t take your side men for granted. If you can do it all by yourself, more power to you. But consider the magic that might be in the group. Would you want to hear Bono without the Edge? Most likely, not.
So get your thoughts out into the open and on paper. If you are going to be interfacing with real players in the music industry get legal agreements. Do it before the project starts, especially if it’s a partnership. If the music sucks or your business strategy tanks, it doesn’t matter. If it takes off, even half a percentage point could mean tens or even hundreds of thousands of dollars.
Even if there is no money involved, you should still get agreements because it’s good business. People often say that business can ruin friendships. I say, only bad business ruins friendships. If you trust your musical partner, there is no reason not to have an open and honest discussion about your futures. Take your business maturity up a notch. Just because you think you’re the creative type, doesn’t mean you can’t be a good business person too. And only you can advocate for you.