Three Questions to Ask Yourself Before You Sign the Deal
The moment you’re offered a record deal, a publishing deal, a license agreement, or a placement can be very exciting. After years of hard work, the opportunity to take your career to the next level might feel like a dream come true. However, signing a deal is a major decision that can significantly impact your artistic freedom, financial stability, and long-term success. Before you put pen to paper, ask yourself these three critical questions to ensure you’re making the best move for your career.
1. What Are the Terms of the Deal?
Not all deals include the same industry-standard terms. Whatever type of agreement you’re being offered, each comes with unique terms and obligations. The key elements (terms) to review and make sure you understand include:
Advance/Payment:
- How much upfront money are they offering, and exactly how will it be recouped?
- Does the advance even have to be recouped, or is it a fee?
- Are there any additional fees you will be expected to recoup, such as an administration fee hidden throughout the agreement?
Royalties:
- What percentage of sales or streaming revenue will you earn?
- Will this change over time or stay the same?
- How will your publishing and mechanical royalties be handled and split?
Ownership:
- Will you retain control over your masters and publishing rights?
- If so, how much?
- Is there a set amount of years that must pass until you regain full control?
Creative Control:
- Does the label have final say on your music, image, or branding?
- Can you collaborate with other artists freely?
- Is there a non-compete clause restricting your work outside of this deal?
If you don’t fully understand the legal language, it is so beneficial to hire an experienced entertainment lawyer to help you navigate the fine print. You can check out our blog post on this topic here. If you do have a lawyer handle your agreement for you, make sure that you read through the agreement too and at least understand the terms. Being aware of the terms yourself makes sure you know exactly what you’re getting yourself into. You can even tell your lawyer what terms to negotiate/change, what terms are non-negotiable for you, etc.
2. How Will This Deal Support My Career Goals?
A offer with a tempting dollar sign might not always align with your overall vision or goals as an artist or producer. It may seem like the money will change your life, but pausing to ask yourself what type of change you actually need based on your goals is more important. If it does align with your career goals, great! But first, ask yourself:
- Does the label/company have a proven track record of success with other producers or artists in your genre?
- What exactly is the label/company’s plan for marketing and promoting your music?
- Does this deal provide opportunities to expand your audience?
- Will they provide tour support and other resources to expand your reach?
- Who is funding the promotional efforts, and is that money recoupable?
- Are you comfortable with the timelines and output expectations they set?
Signing with a company that doesn’t prioritize your artistic identity could leave you feeling creatively trapped. It’s important to make sure that the deal aligns with not only your professional goals, but your personal goals as well. It won’t be beneficial to be locked in to a 3, 5, 10 year deal if you’re not able to grow as an artist and eventually earn that money on your own.
3. What Are the Risks and Exit Strategies?
Deals often come with long-term commitments, so understanding your potential risks is crucial. One easy way to see if the label or company is trustworthy is to speak with other artists or producers who have worked with them before. Ask their opinion on the company and have them share what their experience was like. Consider:
Duration:
- How many albums or years are you committing to?
Reputation:
- What is the track record of the label/company?
- Do they genuinely support your vision, or is this just a numbers game for them?
Exclusivity:
- Are you restricted from collaborating with or releasing with other labels?
Termination Clauses:
- What happens if you aren’t happy as the term goes on?
- How do they handle conflicts or disputes with artists?
- Do they get a first right of refusal and a matching right? (We advise against a label having both)
Before signing, weigh the potential risks against the benefits. Knowing the process for ending the contract can protect you from future conflicts. A promising deal might offer great exposure but leave you with minimal control or profits.
Final Thoughts
Any of the deals mentioned above can be a game-changing opportunity, but it’s essential to approach them with knowledge and caution. By asking these questions and seeking professional guidance, you can make an informed decision that supports both your music and your career. Remember, the right deal should empower your growth as an artist, not limit it!
