Business Basics for Musicians: The Complete Handbook from Start to Success

By Bobby Borg

There has never been a greater need for musicians to understand the music business than now, when emerging technologies make it possible for artists to act as their own record labels, and new contracts are structured to grab the biggest slice of an artist's revenue pie. But in a digital age overflowing with confusing and ever-changing information, musicians need trusted business advice from a veteran artist who can break down the basics in a language they understand.

Written by a professional musician for other musicians, Business Basics for Musicians is the layperson's guide to the music industry. In a conversational tone and an easy-to-scan format, it simplifies five vital areas in which musicians need to succeed: Career Execution, Business Relationships, Pro Teams, Deals and Dollars, and Future Predictions. Everything from copyright to record deals, managers, merchandising, and doing it yourself is covered.

With interviews, anecdotes, and review quizzes, this must-have manual will help artists master business essentials quickly so they can get back to doing what they love best – creating music.

• Language: English
• Publisher: RowmanLittlefield
• Release date: Aug 1, 2015
• ISBN: 9781495050374

Book preview

Praise for Business Basics for Musicians

In this day and age, it’s irresponsible for an artist to enter the music industry without having a grasp of the business. This book should be required reading for all industry neophytes.

—STEVE VAI, internationally renowned guitarist

As a veteran of both the creative and business sides of the industry, Bobby has the background necessary to assist artists and explain the changes in the business in a way that is easily understood.

—STEVE WINOGRADSKY, attorney and author, Music Publishing: The Complete Guide

There are many books out there dealing with the music business, but Bobby’s book has a special and important perspective—that of the working musician.

—MARK GOLDSTEIN, former senior vice president of business affairs at Warner Bros. Records

Thoughtful, insightful, sobering and––above all––useful insights and advice for anyone in need of a road map through the tangled jungle that is the new music industry.

—MARK NARDONE, senior editor, Music Connection magazine

If you can read this sentence, you are already more than qualified to be an international rock superstar. If you can read this book, you might even get your music into the marketplace with a price tag on it, and actually make a couple of bucks in the process, too.

—MIKE INEZ, Alice in Chains

The information in Bobby’s book is worth its weight in gold; it can mean the difference between succeeding and failing in the new music business. In his second life, Bobby will be reincarnated as a music attorney. This book is a must-read!

—DINA LAPOLT, entertainment attorney at LaPolt Law, P.C.

Bobby’s book is an easy read. It gives a synopsis of our business today—a great quick reference guide for anyone interested in the new business of music.

—FRED CROSHAL, CEO of Croshal Entertainment Group and former general manager of Maverick Records

Copyright © 2015 by Bobby Borg

All rights reserved. No part of this book may be reproduced in any form, without written permission, except by a newspaper or magazine reviewer who wishes to quote brief passages in connection with a review.

Published in 2015 by Hal Leonard Books

An Imprint of Hal Leonard Corporation

7777 West Bluemound Road

Milwaukee, WI 53213

Trade Book Division Editorial Offices

33 Plymouth St., Montclair, NJ 07042

Printed in the United States of America

Book design by Kristina Rolander

Library of Congress Cataloging-in-Publication Data

Borg, Bobby, author.

Business basics for musicians : the complete handbook from start to success / Bobby Borg.

pages ; cm -- (Music pro guides)

Includes index.

ISBN 978-1-4950-0776-7

1. Music trade--United States--Vocational guidance. 2. Music trade--United States--Handbooks, manuals, etc. I. Title.

ML3790.B6786 2015

780.23'73--dc23

2015024274

www.halleonardbooks.com

Contents

Preface

Acknowledgments

PART 1: CAREER EXECUTION

1. PURSUING A CAREER IN THE NEW MUSIC INDUSTRY: 15 Tips for Career Success

Tip #1: Realize Your Dreams by Visualizing Them First

Tip #2: Analyze Your Career Motivations

Tip #3: Develop a Realistic Outlook by Ignoring the Media Hype

Tip #4: Be Ready to Pay Your Dues, but Use Your Head

Tip #5: Expect the Worst to Happen So That the Worst Won’t Seem So Bad

Tip #6: Let Go of Your Fears and Learn How to Go for It

Tip #7: Form Solid Connections in the Clique of the Future

Tip #8: Nurture New Opportunities While You’re Already On the Job

Tip #9: Climb Through Back Windows When Front Doors Aren’t Opening

Tip #10: Create Your Own Destiny by Being Proactive

Tip #11: Adapt to Change by Diversifying Yourself Now

Tip #12: Be Practical About Money by Keeping It and Making It Grow

Tip #13: Maintain Control in the Face of Drugs and Alcohol

Tip #14: Remember That Finding Your Passion Is a Blessing Within Itself

Tip #15: Hang On to the Basics

Q&A with Success Coach and PR Expert Michael Levine

PART 2: BUSINESS RELATIONSHIPS

2. BAND MEMBERSHIP, PART 1: Formation and Self-Management

How and Where to Look for Musicians

Criteria for Choosing Band Members

Discuss the Band’s Vision

Use the Personality Questionnaire

Set Goals, Break Down the Work, and Estimate the Schedule/Costs

The Day-to-Day Operating Rules of the Band

Talk About Teamsmanship

Hold Band Meetings That Don’t Suck

Run Your Rehearsals Effectively

3. BAND MEMBERSHIP, PART 2: Partnerships, Trademarks, and Business Entities

Band Membership Agreements

Your Band Is a Legal Partnership

Elements of Band Agreements: What to Include

Q&A with Attorney Jeff Cohen

4. CONTRACT EMPLOYMENT OR SELF-EMPLOYMENT, PART 1: Gigs and Unions

Getting the Gig: How to Be a Working Musician

The Preliminary Necessities

Breaking into the Scene

Lasting for the Long Haul

Seeking Fair Treatment and Guidance via the AFM

AFM Major Benefits: Payment Regulation and Enforcement

Special AFM Benefits: Funds, New Use Fees, and More

AFM Health and Retirement Benefits

Other AFM Benefits

AFM Membership and Benefit Requirements

Is Joining the AFM Right for You?

Seeking Fair Treatment and Guidance via SAG-AFTRA

General Differences: SAG-AFTRA Versus the AFM

5. CONTRACT EMPLOYMENT OR SELF-EMPLOYMENT, PART 2: Employment Agreements and Negotiations

Working for Employers with Limited Budgets

Working for Employers with Larger Budgets

Wages

Retainers

Rehearsals

Per Diems

Buyouts

Special Travel and Lodging Accommodations

Special Clothing

Instruments and Travel Cases

Equipment Parts and Repairs

Equipment Endorsements

Equipment Techs

Equipment Insurance

Working for Employers Who Offer a Salary and Percentages

6. CONTRACT EMPLOYMENT OR SELF-EMPLOYMENT, PART 3: Taxes and Insurance

Understanding Your Taxes: Uncle Sam’s Cut

Contract Employment (Why Is My Check So Small?)

Self-Employment / Independent Contractor Status

Workers’ Compensation Insurance

Contract Employees: Covered

Self-Employment / Independent Contractor Status: Not Covered

If Not Covered, Where Can I Find Insurance?

The IRS: Qualifications for Employment

7. SOLO ARTIST AND EMPLOYER: Pros, Cons, and Responsibilities

The Advantages of Going Solo

Fewer Hassles over Making Decisions

Increased Earning Potential

Greater Job Security

More Freedom to Sail Alone

The Disadvantages of Going Solo

Greater Financial Burdens

Increased Workload

Greater Leadership and Business Demands

Fewer Members to Blame or Hide Behind

More Pressure to Succeed

Leaving Member Clauses: The Record Company’s Rights to Solo Artists

What Is a Leaving Member Clause?

How Does a Leaving Member Clause Work?

Leaving Member Clauses and Prorating Expenses

The Business and Legal Responsibilities of Solo Artists

Treat It Like a True Work Made for Hire

Pay Wages and Commissions

Handle Income, Social Security, and Payroll Taxes

Provide Workers’ Compensation Insurance

Know the Difference: Contract Employee or Independent Contractor Status

Q&A with DJ Entrepreneur Justin Paul

PART 3: PRO TEAMS

8. ENTERTAINMENT ATTORNEYS: What They Do and What They Cost You

The Role of an Attorney in Your Career

Hiring Your Attorney

Finding an Attorney

Qualities to Look For in an Attorney

Attorney Fee Structures

Hourly Rate

Flat Fees

Percentage of the Deals (5 Percent)

Label Shopping Percentage Deals (10 to 20 Percent)

A Flat Retainer

A Conflict of Interest

Conflicts with Record Companies

Conflicts with Band Members

Conflicts with Personal Managers

Conflicts with Your Own Attorney

Changing Your Legal Representation

Talk About It First

Sever the Relationship

9. PERSONAL MANAGERS: Roles, Options, and Agreements

The Role of a Personal Manager in Your Career

Artist Development

Contracts and Income Streams

Project Management

Hybrid Services: Merch, Publishing, and More

Live Engagements and Touring

Physical and Mental Health Issues

Management Options

Self-Management

Start-Up Management

Established Professional Management

Management Agreements

Exclusivity

Key Person Clause

The Agreement Term

The Manager’s Commission (15 to 30 Percent)

Business Expenses

Limited Power of Attorney

Talent Agency Disclaimer

Dispute Resolution: Arbitration and Mediation

Post-Term Provisions (Sunset Clauses)

10. BUSINESS MANAGERS: Bills and Investments

The Role of a Business Manager in Your Career

Investment Strategies and Financial Planning

Bookkeeping and Accounting

Tour Services

Asset Administration

Financial Reporting

Tax Planning

Insurance: Liability, Auto, Home, and More

Royalty Examination

Hiring Your Business Manager

When to Hire a Business Manager

Finding a Reputable Business Manager

Qualities to Look For in a Business Manager

Important Terms of Your Agreement

Payment Structure

Audit Rights

Power of Attorney (or Limited Power of Attorney)

The Right to Terminate

11. TALENT AGENTS: Work, Scope, and Contracts

The Role of an Agent in Your Career

Formulating Your Tour Strategy

Packaging the Artist

Determining Whether to Open or Headline

Routing the Tour

Pricing the Artist

Determining When to Put Tickets on Sale

Negotiating Fees for Live Performance Deals

Collecting Deposits

Handling Hall Fees

Hiring Your Agent

When to Hire an Agent

Hooking Up with a Talent Agency

Qualities to Look For in an Agent and Agency

Terms of the Agreement

The Agent’s Fee (10 Percent)

The Scope of the Agreement

Exclusivity

The Territory

Duration of the Contract

Rights to Terminate

Are Contracts Even Needed?

12. RECORD PRODUCERS: Creativity, Budgets, and Fee Structures

The Role of a Record Producer in Your Career

When and How a Producer May First Get Involved

A Barter System Arrangement

The On-Spec Agreement

The Do-It-Yourself / Work Made for Hire Approach

The Production Company Deal

The Record Label Deal

Additional Responsibilities of the Record Producer

Creating a Recording Budget

Maintaining a Recording Budget

Handling Other Administrative Responsibilities

Hiring a Record Producer

Selecting a Record Producer

Negotiating the Producer’s Deal

The Record Producer’s Compensation Structure

Producer Advances

Producer Royalties

Master Monies

Music Publishing: When Should the Producer Get a Share?

PART 4: DEALS AND DOLLARS

13. MAKING AND SELLING RECORDS, PART 1: Types of Record Deals and Companies

Do-It-Yourself Recording Companies

General Philosophy

What Makes the DIY Label Possible?

Funding

Budgets

Profits

Distribution

DIY Ain’t Easy, But . . .

Independent Labels

Ownership

Philosophy

Advantages

Disadvantages

Advances/Royalties/Splits

Distribution

Production Companies

Types of Production Companies (From Start-up to Pro)

How They Operate

General Deal Structure

They Are a Godsend

They Are a Pact with the Devil

Advances/Royalties/Splits

Distribution

Major Labels

Ownership/Structure

Departments/Staff

General Philosophy

Advantages

Disadvantages

Royalty Rates/Advances/Splits/Deal Points

Distribution

14. MAKING AND SELLING RECORDS, PART 2: Key Deal Issues in Recording Contracts

Issue #1: Who Is the Label?

Issue #2: How Much Will I Get to Make My Record?

Recording Funds

Advance Plus Expenses

Issue #3: Can I Make the Record I Want to Make?

Mutual Consent of the Record Producer

Approval of Artwork and Other Materials

Issue #4: How Do I Know They’ll Release My Record?

Guaranteed Release Clause

Free to Leave or Buy Back Your Masters

Issue #5: Will I Get Guaranteed Marketing Support?

Deficit Tour Support?

Guaranteed Promotional Videos (YouTube, Vimeo)?

Independent Radio Promotion?

Websites?

Independent Publicity

Issue #6: Do I Have a Say in How the Masters Will Be Exploited?

Issue #7: Artist Royalties: Will I Ever Make Money from the Label?

Artist Royalties and CDs, Vinyl, and More

Electronic Transmissions (Downloads, Ringtones, Audio and Video Streaming)

Issue #8: Controlled Composition Clauses

Issue #9: 360 Rights in Deals

Active Versus Passive Income

The Label’s Cut (What They Take for Merch, Publishing, Tours)

On What Are the 360 Percentages Based?

Issue #10: How Many Records and for How Long Is the Deal?

Firm Records and Option Periods

Term of the Agreement

Issue #11: Can I Record Other Projects?

Rerecording Restrictions

Sideman Performances

Issue #12: Everything Else Artists Should Be Concerned About

Key Person Clause

Guaranteed Third-Party Distribution Clause

Reversion of Rights Clause

Issue #13: What Does the Label of the Future Look Like?

15. MUSIC PUBLISHING, PART 1: Copyright Basics

Copyright: Definition, Formation, and Benefit

What Is Copyright?

How Do You Get a Copyright?

What Benefit Does a Copyright Provide?

But How Can I Prove I Own a Copyright?

Copyright and Work Made for Hire

When It Exists

What Are the Implications?

Copyright and Joint Works

Ownership of Joint Works

Control of Joint Works

Compulsory Licensing for Records

What Are the Conditions?

Financial Benefits

Creative Downsides

Does the Compulsory Licensing Provision Apply to You, Too?

Duration of Copyright

The Copyright Term

Reversion of Copyright

Thirty-Five-Year Statutory Right of Termination

16. MUSIC PUBLISHING, PART 2: Even More Copyright Basics

Copyright Registration

The Benefits of Copyright Registration

Requirements of Registration

Methods of Registration

Tips to Save Money

The Copyright Notice

Do You Really Need the Notice?

What Is the Correct Way to Write the Notice?

Why Are There So Many Different Notices on Album Covers?

Copyright Infringement

What Is Infringement?

Any Substantial Damage?

What Do You Have to Prove?

Sampling and Infringement

Best Course of Prevention

More on Copyright: Sound Recordings Are Copyrights, Too

Key Points of Distinction

Q&A with Attorney Steve Winogradsky

17. MUSIC PUBLISHING, PART 3: Income Streams—Mechanicals, Performances, and Print

Shares of the Publishing Pie

Writer’s Share

Publisher’s Share

How Is the Money Divided?

Does This All Seem Crazy?

Types of Publishing Income

Mechanical Royalties

A Brief Backstory

The Controlled Composition Clause (CC Clause)

Performance Royalties

Who Uses Your Music Publicly?

Who Issues Licenses to Music Users?

Performing Rights Organizations (PROs) to the Rescue

PRO Affiliation: Making Sure You’re Paid

Which PRO Should You Join?

Print Royalties

Types of Print Uses

Division of Print Incomes: Based on RSP and Wholesale

18. MUSIC PUBLISHING, PART 4: Synch, Electronic Transmissions, and Sub-publishing

Synchronization Fees

Income for Rights Holders in the Song

Income for Rights Holders in the Sound Recording: Aren’t They Paid, Too?

Points of Negotiation: Knowing How Much You Should Get

Additional Incomes: More Than You Bargained For

Electronic Transmissions: Downloads, Streams, and More

Permanent Digital Downloads (i.e., iTunes-Type Royalties)

Ringtones

Noninteractive Audio-Only Streaming (i.e., Webcasting and Satellite Radio)

Interactive Streaming-On-Demand Audio

Interactive Streaming Video (Audio-Visual Streams)

Downloadable Sheet Music

Lyric Websites

Lyric Cell Phone Apps

Planet Uranus Streams and Other Stuff

Foreign Sub-publishing Income

Foreign Mechanicals

Foreign Performance Royalties

Black Box Monies

Foreign Sub-publishers

At-Source Royalty Collections

19. MUSIC PUBLISHING, PART 5: Publishing Companies and Types of Deals

What Established Music Publishers Can Do for Your Career

Song Plugging (TV, Film, and More)

Securing Recording Agreements (Cowriters and Credibility)

Paying Advances

Distributing Marketing Funds

Handling Administrative Duties

Types of Publishing Deals

Exclusive Songwriter Agreements

Co-publishing Agreements

Administration Deals

Self-Publishing/Self-Administrating (Doing It All Yourself)

Q&A with Music Publisher Neil Gillis

20. MUSIC PUBLISHING, PART 6: Starting Your Own Publishing Company

Six Steps to Starting Your Own Publishing Company

Step 1: Affiliate with ASCAP or BMI

Step 2: Register with SoundExchange

Step 3: File a DBA (Doing Business As)

Step 4: Registering Your Songs with the Copyright Office

Step 5: Handling Other Administrative Duties

Step 6: Leave It All Up to a DIY-Friendly Administrator (CD Baby, TuneCore)

21. LIVE PERFORMING AND TOURING, PART 1: Purpose and Opportunity

When and Why to Perform Live and Tour

Level 1: The Development Phase—Testing the Waters

Level 2: The Business-Minded Phase—Going In for the Local Kill

Level 3: The Traveling Salesperson Phase—Supporting Your Record

Level 4: The Making-the-Money Phase—Getting It While the Getting Is Good

How and Where to Get Gigs: 9 Tips to Consider

Tip #1: Get Local Club Referrals from Similar Local Bands

Tip #2: Form Band Alliances and Gig Swap

Tip #3: Consider Contacting Colleges

Tip #4: Keep Your Eyes on Corporate Sponsors

Tip #5: Watch for Unsigned Artist Openings on Festival Tours

Tip #6: Play Industry Conventions

Tip #7: Play Where Fans Go: Consider All Alternative Venues and Events

Tip #8: Hire a Personal Manager

Tip #9: Get a Talent Agent

Q&A with Tour Manager Chris Arnstein

22. LIVE PERFORMING AND TOURING, PART 2: Deals, Negotiations, and Contracts

How You’re Paid for Live Performance Deals

Nothing (a.k.a. Free)

Pay-to-Play

Straight Percentage

Flat Guarantee

Guarantee Versus Percentage

How Live Performance Deals Are Negotiated

The Gross Potential

Per-Show Versus Per-Tour Mega-Promoter Negotiations

Co-Headlining Negotiations

Multi-Band Festival Tour Negotiations

Live Performance Contracts and Riders

In the Beginning: Local Gigs to the Early Stages of Touring

At the Mid-Level to Big Leagues of Touring

23. MERCHANDISING, PART 1: Rights, Types, and Companies

Merchandising Rights

Publicity Rights

Trademarks

Grants of Rights

Merchandising Companies

Types of Merchandising Deals

Tour Merchandising

Retail Merchandising

24. MERCHANDISING, PART 2: Contract Terms for Tour Merchandising

Key Touring Terms in Merchandising Contracts

Royalty Rates

Merchandising Advances

Performance Guarantees

The Agreement Term in Merchandising Deals

Creative Issues in Merchandising Contracts

Territory (The World, North America, or X-Japan)

Exclusive Rights in Merchandising Deals

The Sell-Off Period

25. MERCHANDISING, PART 3: Retail Deals and Independent Merchandising

Key Retail Terms in Merchandising Contracts

Royalty Rates: Retail Merchandising

Q&A with Independent Merchandiser Bob Fierro

PART 5: FUTURE PREDICTIONS

26. THE MUSIC BUSINESS 2020: Future Forecasts by the Pros

Copyright Laws: Making Way for New Trends in Music

Fair Compensation for Creators

Success That’s Earned on Your Own: DIY Style

Affordable DIY Services That Capture New Revenue Streams

Success Will Be Driven by Touring and Merch

The Concert Business Will Be Shaped, but Never Replaced

Business Skills Are Paramount in a Fast-Paced and High-Tech World

Shifting Demographics Mainstreamed

More Automated and Sophisticated Marketing Everywhere

Extended Product Lines and Stronger Brands

Captured Musical Performances, Not Manufactured

A Focus on Exciting Music—Not the Latest Technical Trends

Opportunity for Smart Entrepreneurs, Not for Artists

The Industry’s Salvation: Memorable Song Melodies

Chapter Review and Discussion Questions

Chapter Activity Assignments

Preface

Why should you read this book? Most musicians spend years developing their musical talent only to learn about the music business the hard way—one mistake at a time. Focused on their creative passions and the dream of an exciting career, musicians often leave business matters entirely in the hands of others. As a result, they are frequently taken advantage of, or they develop unrealistic expectations which inevitably are not met. But, if you want music to be your livelihood, you must treat it as a business or the business will take advantage of you.

What inspired me to write this book? When setting out to revise The Musician’s Handbook (my first work, used by top schools and talented artists nationwide), my objective was to carry on the tradition by providing the most up-to-date, accurate, and relevant information in a readable way. But, as I considered the vast changes in the music industry today, and studied the way in which information is consumed in our fast-paced, high-tech world, I identified a need for an extraordinary rendition of a classic—one that breaks down the basics into bite-sized chapters, bullet points, and memorable anecdotes, and that helps musicians navigate fundamental career matters from start to success. Business Basics for Musicians is the layperson’s guide to the music industry. It simplifies core essentials and decodes the latest issues, so that artists can focus more confidently on what they do best—create music!

How is this book different? Business Basics for Musicians contains invaluable tips for artists pursuing a career that only a musician who’s lived through it can reveal. Along with my firsthand experiences and knowledge of the music business, this book includes one-on-one interviews, real-life anecdotes, and invaluable wisdom from a variety of industry professionals so readers can benefit from a broad perspective. And because I’m not affiliated with any one corporate entity, there’s no question of bias—I’m able to offer candid views on every aspect of the music business. Fledgling attorneys, personal managers, producers, and anyone else interested in the music business can also benefit from reading this book, which will give them a solid foundation of industry knowledge and an invaluable view from the artist’s side.

What does this book offer and how is it organized? Business Basics for Musicians is divided into five parts that cover the most important issues facing the business today:

• Part 1—Career Execution: This section gets musicians into the right mind-set for pursuing a career in today’s music industry with 15 Tips for Career Success. Although the best lessons often come from experience, you can learn a great deal from those who have been down the path before you. Topics include creating your own destiny by being proactive, climbing through back windows when front doors aren’t opening, and developing a realistic attitude by ignoring the media hype.

• Part 2—Business Relationships: This section covers the primary relationships in which you may find yourself: as a band member, solo artist, and employer; or as a contract employee or self-employed musician. Not only is it important to understand the differences between these relationships; it is equally important to understand the various business issues associated with each one. From the AFM and SAG-AFTRA new scale wages to the latest methods for running an effective team, these chapters give you the basics relevant to your career status.

• Part 3—Pro Teams: This section focuses on the many business professionals you may need to help you make the right career decisions. Individual chapters cover the vital roles played by entertainment attorneys, personal managers, business managers, talent agents, and record producers in the new music industry. It is important to understand not only what role each of these important team members plays, but also when in the development of your career their assistance is necessary.

• Part 4—Deals and Dollars: This section provides an analysis of new revenue streams, royalty payments, and fee structures for the digital age, including publishing royalties, live performance fees, and merchandising monies. Chapters also include copyright basics as they apply to today’s business, the pros and cons of giving up your publishing rights, common misconceptions about touring, and the types of merchandising that may be considered. Overall, this section simplifies complex topics so you can make your way safely through the legal minefield of the music business. And finally . . .

• Part 5—Future Predictions: This section looks ahead and offers a realistic view of the music business in 2020, provided by professionals from every facet of the business.

So, who am I? I’m a former major label, independent, and DIY recording/touring artist with over 25 years’ experience working alongside the most respected managers, producers, and A&R executives in the music industry. As an adjunct professor of music business, I teach at Musicians Institute and UCLA Extension, where I received the Distinguished Instructor of the Year award, and speak at Berklee College of Music and other prominent schools worldwide. I’m the author of The Musician’s Handbook, Music Marketing for the DIY Musician, and over 1,000 magazine and blog articles. As the founder of Bobby Borg Consulting, I assist rising music professionals globally.

How should this book be used? The best way to read this book is from cover to cover so that you don’t miss a single beat. However, Business Basics for Musicians is designed so that each section stands alone, and I encourage you to consult the individual chapters that are applicable to your personal career status. That way, you can get exactly what you want, when you need it. And for those of you who are really on the fast track, Business Basics for Musicians is full of boxed anecdotes that relate to important aspects of the text, making it easy to flip through these pages and read interesting real-life stories and facts. There are also chapter quizzes and assignments in the back if you want to test your knowledge. Note that every attempt has been made to keep the information current, but understand that the music business is ever changing—especially in the face of new technologies—so be sure to check in for articles at www.bobbyborg.com. Additionally, though Business Basics for Musicians is designed to provide you with a thorough understanding of the music business, every business situation you come across will be unique; therefore it’s recommended that you also consider the advice of the appropriate professional.

Keep in mind that the music business is not easy to understand, and it will require some patience and work to do so. The information presented here is only as good as your desire to comprehend and use it. And a journey of a thousand miles begins with a single step.

With talent, preparation, and luck, you can have an extremely rewarding career in music, both creatively and financially. I hope you will find this book to be a valuable tool to help you to achieve your professional goals. Let’s get to it!

THE FACTS, NOT THE FAIRY TALES

Business Basics for Musicians investigates the realities of the music business behind the glamorous fantasy world often portrayed in the media. It is designed to help you to understand the ins and outs of the music industry. At times it will seem harsh. But the more aware you are of the potential obstacles in your path, the better prepared you will be to overcome them. Make no mistake, the purpose of this book is to encourage, and never to discourage. Whether you’re out on the road or just getting ready to cut your first record, it pays to be armed with as much ammunition as possible. Perhaps these quotes from a book popular among music industry executives will help illustrate my point:

Know yourself and know your enemy and you will fight a hundred battles without disaster.

Know the ground, know the weather; your victory will then be total.

—Sun Tzu, from The Art of War

Acknowledgments

Thanks to my dearest Dad; family; closest friends; UCLA and Musicians Institute staff; and John Cerullo, Jessica Burr, Zahra Brown, Wes Seeley, and everyone else at Hal Leonard Performing Arts Publishing Group for understanding my vision and making this book possible.

Thanks to my technical advisors, consultants, focus group members, proofreaders, and close friends, and those directly involved with the development of this book: Michael Eames (president, PEN Music Group, Inc.); Neil J. Gillis (president, Round Hill Music); Kyle Staggs (director, Music Business Affairs at Universal Pictures); Brad Andersen (head of touring, Global Merchandising Services); Bob Fierro (president, Zebra Marketing); Sidney Kibodeaux White (SAG-AFTRA); Stephanie Taub (national director, Sound Recordings, SAG-AFTRA); John Pantle (agent at APA Talent and Literary Agency); Justin Paul (founder, Playloop Records); Karl Louis (Moral Compass Management); Aaron Meza (adjunct professor, Musicians Institute); Dina LaPolt (LaPolt Law P.C.); Burgundy Morgan, Esq.; Steven Winogradsky, Esq.; Shawna Hilleary, Esq. (Artist Law Group); Jeff Cohen, Esq. (Millen, White, Zelano, and Branigan); Marty O’Toole, Esq.; Ben McLane, Esq.; Robert Nathan (law consultant); Ryan D. Kuper (founder, Redemption Records/Balance Entertainment); Britt Draska (consultant and director of royalties, formerly at Lakeshore Entertainment Group); Brian Perera (president, Cleopatra Records); Rob Blasko Nicholson (Mercenary Management, bass player for Ozzy Osbourne); Robert Shahnazarian, Jr. (producer of Killers, Incubus, John Legend, and others); Jeff Weber (Weberworks Entertainment Group); Geza X (producer of Black Flag and others); Samm Brown III (award-winning record producer and songwriter); Michael Levine (Levine Communications Office); Jeff Hinkle (Gudvi, Sussman & Oppenheim); George Fernandez (Deloitte Consulting, certified public accountant); Sharon Gilday (Down to Earth Business Management); Ian Copeland (Frontier Booking International); Michael Laskow (CEO of TAXI); Pascale Halm (director, UCLA Extension); Mike Inez (bass, Alice in Chains); Randy Castillo (drummer, Ozzy Osbourne); Chris Arnstein (tour manager); Don Gorder (chair and founder, Music Business / Management Department, Berklee College of Music); Tony van Veen (CEO, AVL Digital Group, CD Baby, Disc Makers); John Hartmann (former manager of Peter, Paul & Mary; Crosby, Stills & Nash; America; Poco; the Eagles; and others); Chaz Austin (Ed.D.; former career development director, Musicians Institute; author of How to Find Work and Keep Finding Work for the Rest of Your Life); Dan Kimpel (author of It All Begins with the Music: Developing Successful Artists and Careers for the New Music Business); Ira S. Kalb (professor of marketing at the Marshall School of Business at University of Southern California; president, Kalb & Associates); Fred Croshal (Croshal Entertainment Group, LLC); and Mike Gormley (LA Personal Management; former manager of the Bangles, Oingo Boingo, and Danny Elfman).

Thanks to all of the educational institutions that use this book, to my UCLA panelists, and to those from whom I have obtained invaluable advice throughout the years. You know who you are. For a more complete list, see www.bobbyborg.com.

Part 1

Career Execution

1

Pursuing a Career in the New Music Industry

15 Tips for Career Success

The music business is a cruel and shallow money trench; a long plastic hallway where thieves and pimps run free, and good men die like dogs. There’s also a negative side.—Hunter S. Thompson

Let there be no mistake—pursuing a career in the music industry is not easy, nor is it for the thin-skinned. The successful musicians you see today in the media—getting millions of hits on YouTube, performing before large audiences at the coolest music festivals, or getting reviewed on popular music blogs—represent only a minuscule percentage of all the musicians in, or trying to break into, the music business today.

Knowing these odds, why would anyone continue to pursue a career in the music business? The love of playing music, the tools and technology of the digital age, and the success stories of hardworking artists inspire plenty of people to try. After all, why can’t you be one of the lucky ones who achieves tremendous success, or at least makes ends meet, doing what you love as an independent musician? You’re talented, you’re smart, and you’re reading this book to better understand the inner workings of the music industry. You’ve already got a lot going in your favor!

While there are no rules or set guidelines that can guarantee a prosperous and long-lasting career, I’ve outlined 15 general tips for career success—from visualizing your dreams to being proactive. Whether you are a rapper, DJ, producer, songwriter, solo artist, band, or anyone else wishing for a successful career in music, these useful tips apply to you!

Tip #1: Realize Your Dreams by Visualizing Them First

The first tip for pursuing a successful career in the music business deals with having a clear vision of what you’d like to achieve. You must see, feel, and believe in the potential outcome. If you can clearly hold a picture of success in your mind, your subconscious can bring it to pass.

In the early 1990s, in a small club called the Button South in Fort Lauderdale, Florida, I witnessed Marilyn Manson gaze out into the audience and say, One day I’m going to be a pop star who shocks the world. He truly believed this. Friends tell me he even kept drawings in a notebook mapping out precisely what his success would look like. With years of hard work, and one successful album and tour after another, Manson made his vision complete.

In his best-selling book The Power of Your Subconscious Mind, author Joseph Murphy calls this the mental-movie method. In his words, If I act as though I am . . . I will be.

Tip #2: Analyze Your Career Motivations

Dovetailing nicely from tip number 1, another important tip for career success is to consider just why you are pursuing a career in the music business. Is it for the fun and crazy lifestyle it may offer? Is it for the artistic respect it may earn you among your peers? Or is it for the spiritual satisfaction it may bring, and because there is nothing else in life you would rather do? As you know, fun, artistic respect, and spirituality are not always aligned. Thus, your answers to the above questions are crucial!

By understanding your true motivations and what’s most important, you’ll stand firm about what you are (and are not) willing to give up in order to succeed. You’ll surround yourself with people who share your vision and are willing to pay allegiance to that flag. And you’ll accept the consequences of your actions and not whine and bitch about the results in the end.

Tour manager/agent/promoter Chris Arnstein calls this approach to self-awareness the decision-making tree. Your career decisions (or branches) should be based on the core (or root) of who you truly are as a person. Without this level of self-awareness, you can easily go astray in this business. As they say, if you don’t stand for something, you can easily fall for everything.

If you haven’t thought about your real motivation for pursuing music professionally, now is a good time to do so.

Tip #3: Develop a Realistic Outlook by Ignoring the Media Hype

You’ll enter the music business from a much stronger position if you refuse to be blinded by all of the media hype or glamour you see and hear in music videos, magazines, and news shows. The expensive houses and yachts and the carefree attitudes and overnight success stories are often spun to make it look like the music business is an easy path to the good times. The truth is that these riches that artists flaunt are often leased, loaned, advanced, or purchased via other businesses and investments just to help a celebrity look the part.

By developing a realistic outlook, you’ll be better prepared for what may lie ahead and more accepting of this wonderful and crazy business of music. You’ll understand that it could take a great deal of time and money honing your professional skills, building a fan base, and putting up with a great deal of rejection just to get ahead. But you’ll be okay with that. You’ll know deep down inside that the true talents of music lived and breathed their art with no thoughts of ever turning back, and that this determination and tenacity in regard to your craft and career is precisely what is required of you.

So get your head together! Focus on the realities of the business, not the fairy tales.

Tip #4: Be Ready to Pay Your Dues, but Use Your Head

One of those unavoidable realities of the music business is that pursuing a career will mean paying your dues.

Paying your dues essentially means paying the price for your lack of professional experience. That price is your time and hard work, which may yield little or no compensation (in other words, you work for free).

However, keep in mind that the more experience you gain, the more valuable a commodity you become. The day will arrive when you’re justly compensated—whether you are a vocalist singing background sessions, or a band paying promoters to play local clubs.

Just remember to stay focused on the bigger picture. It’s not always what you earn, but what you learn that matters. Of all the tips for career success, this ranks extremely high.

WARNING: KNOW YOUR PERSONAL BOUNDARIES

While on the topic of paying your dues, you should know that there are many people in the business who will take advantage of your inexperience and make you pay more than your usual dues. Welcome to the school of hard knocks, or, as some call it, the new kid treatment.

In the classic movie Swimming with Sharks, an intern is embarrassed, harassed, insulted, and even bullied by his boss. The intern bravely tolerates this abuse, all in the name of moving up the ladder to success, but it eventually takes a serious toll on him.

Should you feel that you are being treated unfairly, stay focused on the bigger picture. Think of the situation as only a stepping stone toward achieving your ultimate vision.

However, know your personal boundaries and what you will and will not tolerate. No matter how big the gig may be, draw the line if you feel that the outcome may have a negative impact on your psyche, or if you generally feel that you’re being ripped off! Nothing is worth more than your self-respect and dignity. Don’t forget it!

Tip #5: Expect the Worst to Happen So That the Worst Won’t Seem So Bad

At 1/3 of the way through our 15 tips, I think you’re in the right mind-set already to hear one of the toughest tips for pursuing a career in music. Ready for it? Here goes: expect the worst to happen, because it will! The good news, however, is that you can be prepared for it.

Remember the old saying, Shit happens! Recordings sell poorly, bloggers write unfavorable reviews, and people will try to rip you off. Such events are an inevitable part of pursuing a career in music and an aspect that’s certainly not for the thin-skinned.

Expect to be knocked down, but learn how to get up quickly and see the lesson in every negative experience. Realize you can’t control everything that happens in this crazy business, but you can definitely control your attitude. You must focus on the positive. To survive in the biz, you must be resilient and prepared to fight forward.

As Jon Kabat-Zinn says in his book Wherever You Go, There You Are, You can’t stop the waves, but you can surely learn to surf.

Tip #6: Let Go of Your Fears and Learn How to Go for It

According to Danny Sugerman and Jerry Hopkins’ book No One Here Gets Out Alive, Jim Morrison once asked, If your life was a movie, would anyone want to watch it? For many artists, the answer is a flat no. They take a one-foot-in/one-foot-out approach to their careers and never dive in fully.

Jared Leto of Thirty Seconds to Mars pursued various opportunities in Washington, D.C.; New York; and Philadelphia before moving out west to pursue his vision as an actor and rocker. He saved a couple hundred dollars, packed a backpack, and bought a one-way ticket to Los Angeles. With an Academy Award for Best Supporting Actor and over 10 million records sold, the rest, as they say, is history.

If you have what it takes—if you’re realistic, smart, and talented—then what’s holding you back from giving your career your best shot? Is it the fear of moving to the big city, fear of rejection, or fear of going broke? Whatever it is, remember that fear is only a thought that can replaced by more positive thoughts. As boxer Mike Tyson said during his years as the world champion, Fear is like fire. It can either cook for you, or it can burn you. Let it cook for you.

Look, what’s the worst that can happen, anyway? You might fall short of your dreams, but you’ll at least know that you gave your career your best shot. You’ll have no regrets! And that, my friends, is priceless! So let go of your fears and learn to go for it. You’ll be glad you did.

Tip #7: Form Solid Connections in the Clique of the Future

Make no mistake that networking is a vital part of establishing a successful career in the music industry. But rather than using all your energy trying to break into established and seemingly impenetrable cliques, be sure to recognize others who are talented, intelligent, and ambitious (like your fellow students or local musicians), and create your own "clique of the