On Creating The New Record Label
Guest post by Tyler Hayes, founder of Liisten.com, an independent music discovery site.
Maybe you disagree that the way record labels operate is broken, or maybe you're signed to one and can't share your true feelings. Either way, here are some ideas, dreams, and wishes for what something new might look like.
I've thought for some time that the "new record label" should be similar in function to venture capital, or, more simply, a loan. The band or artist borrows a minimal amount ($5-$10k) to record an album and then revenue is split between band and label until loan is paid back*.
A band was always a business, but now the members are the only employees carrying out all the work, from producing the content to marketing it and then managing the returns. A lot of times they just need a little bit of money to get off the ground and get something recorded. Once the loan from the new label has been paid back the percentage going to the label would shrink to 25%. The key in all of this is fairness. Through all of the this, the artists would retain all their rights. The reason there are so many independent bands and bands that would rather not make it than make it on a major label is because they want to own their own songs. This seems fair. Of course, the label would be granted promotional and limited rights to use the music, but would not own them.
It's great that there are crowd funded bands, if enough people think a band should make an album then, by all means, they should. This new type of label would still be geared toward exclusivity and actively seeking out a few bands at first, continually growing.
Essentially the new label is all about scouting out quality bands that are making good music and good people serious about their craft. The same way you bet on the stock market or invest in a new business by doing your homework and ultimately betting on what you know, this should be the same for music.
* If a band borrowed $10k and sold their album for $5, they would only need to sell 2000 copies to be even. This also does not count the possiblity of taking some of that money and making merch that could then be sold to then give the album away or make up in other ways.