Many artists don't want to rely on record labels. That's why they're motivated to go the independent route. However, independence only works if you understand how to make labels optional rather than necessary. So, if you want to learn how to do that, tune in to today's episode.
Making it to $10,000 a month puts you in the driver's seat!
What no one tells you about making $10,000 a month in the music business is that you're essentially a virtual millionaire. This means you have an asset or group of assets generating the equivalent of a 10% return on $1,000,000 invested. The same principle applies even at $4,000 a month. This is called income cash flow—something record labels cannot provide. Even though reaching this level takes hard work, most of my clients who've made it are starting to turn down deals because their cash flow is so good that a one-time lump sum doesn't mean much. If you make it here, it's safe to say you're looking for a different type of deal. If you're not at this level yet, hang in there.
Profit determines the deal - 20%-30% profit margin
What if I told you that before you do any deal the profit should be built in? If you never heard this before listen closely. If you cannot see the profit on paper before the deal is done there is no use in doing the deal. A 20-30% profit margin is ideal when crafting a deal. If the mindset of the artist has reached this point it's safe to say no baby oil will find its way to your body. Because you are probably starting to get the things you’ve wanted to get on your own with your team. Creating deals with no profit in sight leads to getting burned in more ways than one putting you in a slippery situation.
Record Labels hate the word Scale
When labels who still want to do business with you at this point find out you know what "scale" means, they realize they don't have a deal. They're very aware they'll have to switch their positioning. If you understand that scaling means removing yourself physically from work that can be duplicated and automated—while still getting the same results multiplied infinitely—then there's no hope for discussion with a label partner. Many will bow out. If you learn how to scale your very own music business, there will be nothing standing in your way of achieving success while keeping your soul intact.
Why don’t the record labels give you cash flow?
They do but its in the form of royalties. Unless you’re a hit artist for quite some time it means nothing. So in many cases record labels pay you to do a job which is to record the album and to help them promote the album ethically within the confines of a designated period.
How do you make the 10,000 a month?
You have to build a portfolio of high-quality assets, songs, masters, Intellectual property, Photos, liver recordings, etc. Then you have to raise that portfolio’s value by marketing the hell out of if “strategically”. After that, you want to make sure your collection buckets are set up properly so the in coming cash can be collected. Repeatedly doing this over and over again becomes cash flow.
How do you find profit in a record deal if music is a loss leader product?
You have to realize what determines profit. is the music a promotional piece for your brand in the immediate? Will it profit later and how much of the revenue is your net profit? (i.e. artist royalty) If you can see the profit in the deal great but if you come out making less than 20% what are we talking about? You’ve lost control even before you’ve started because you’ll never be able to pay the money back in a reasonable amount of time and when you do start making money it will only make a blip in your net worth. The ability to see the profit up front is everything.
Here’s what you can do!
Learn how to automate what you’re doing
Get in the habit of building profit into your deals or finding the profit in the deal
Develop a plan to start making $1000 per month passively
The Winning Outlook
Doing this will create more time so you can live
if you have more time so you can live then you have more time to create better music and opportunities
if you learn how to buy your time back so you can create better music and opportunities. Nothing will be able to stop you.
What’s it going to cost in failure
doing things manually leads to physical exhaustion
This takes away your Energy to create
if you don’t have the energy to create or time to do it, you won’t the music will become a lost cause.
At the end of the day
If you were struggling with:
creating passive income
Building profit into your deals
automating your task
You now have the means to become an artist who doesn’t need a label but needs a partnership.
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