Starting a record company
Discussion
Everything in life is hard.A good friend is one half of a songwriting duo. They've had some moderate success in Country and Classical crossover stuff.
They set up a Record Company a few years back (I designed the logo!). They ended up binning it because it wasn't needed. They now run everything through a publisher and Emubands (https://www.emubands.com). The latter performs most, if not all of the functions of a traditional record company.... promotion, play-list pitching, distribution plus they do all the social media too. It's a subscription service, costs around £50 a year for the pro service.
The days of a mate of the band with a bit of nous or a mercurial promoter setting up a Record Company is no longer a thing, sadly.
From what I can determine, setting up a Record Company puts you in competition with the likes of Emubands and similar. These are very heavily capitalised businesses, set up by music execs who know their way around the business.
There may still be a place for Record Companies but I think it necessary to consider exactly what you can offer and do that's going to turn a profit. Keep in mind that it is exceptionally difficult to earn big from music these days. It always was, of course but the difference today is that even significant chart success does not always lead to riches or even costs being covered.
I used to run a Community Radio station between 2010 and 2016. We had a pro recording studio for local bands and aspiring artists. We looked into setting up a label as a means to raise funds for the station but the resources needed and the financial risk was too great.
But.... you may end up signing the next Ed Sheeran. The chances may be slim but non-existent if you don't do it.
Fundamentally, it all comes down to the same things as any business; cost, customers, cash and risk.
HTH
They set up a Record Company a few years back (I designed the logo!). They ended up binning it because it wasn't needed. They now run everything through a publisher and Emubands (https://www.emubands.com). The latter performs most, if not all of the functions of a traditional record company.... promotion, play-list pitching, distribution plus they do all the social media too. It's a subscription service, costs around £50 a year for the pro service.
The days of a mate of the band with a bit of nous or a mercurial promoter setting up a Record Company is no longer a thing, sadly.
From what I can determine, setting up a Record Company puts you in competition with the likes of Emubands and similar. These are very heavily capitalised businesses, set up by music execs who know their way around the business.
There may still be a place for Record Companies but I think it necessary to consider exactly what you can offer and do that's going to turn a profit. Keep in mind that it is exceptionally difficult to earn big from music these days. It always was, of course but the difference today is that even significant chart success does not always lead to riches or even costs being covered.
I used to run a Community Radio station between 2010 and 2016. We had a pro recording studio for local bands and aspiring artists. We looked into setting up a label as a means to raise funds for the station but the resources needed and the financial risk was too great.
But.... you may end up signing the next Ed Sheeran. The chances may be slim but non-existent if you don't do it.
Fundamentally, it all comes down to the same things as any business; cost, customers, cash and risk.
HTH
Edited by StevieBee on Tuesday 16th April 19:45
To follow on from my previous post, spoke to my friend and mentioned your question. Couple of other things to consider.
From a business management perspective, even a successful record company's cashflow is a case of feast or famine. You could release an album that flies, bringing in some nice revenue. But this tapers off and then may have nothing for many months. You are reliant upon artists to record songs that people want to buy so have little control or influence over your own destiny. The trick is to build a roster of artists so that you constantly have new content to push out.
He said that one of the biggest hurdles they faced with the Record Company was radio stations. If you want an artist to break-through, you really need their songs on the radio, even in today's streaming world. The trouble is, all of the main stations in the UK are controlled by just three operators: BBC, Global and Bauer and overcoming the gatekeepers of each is not without challenge and comes down to building relationships. He mentioned that because of this, it's necessary to be based in one of the two main 'media' cities in the UK; London and Manchester. His Record Company was based in rural Essex so being able to wine and dine and network with the necessary execs at a moment's notice was not that easy.
Publishing is where it's at. A music publisher tends to represent writers more than recording artists (but you can of course be both). But their primary purpose is licensing for films, TV, Ads, Games, etc. It's called Sync music and can provide a tidy revenue for both publisher and writer. It may not have escaped your notice that there is an enormous amount of content being created these days thanks to the advent of streaming. So, there is also huge demand for music. There's a chap in PH called GetCarter who will know a lot more about this side of the business.
A book recommendation for you: How Music Works by David Byrne (out of Talking Heads).
From a business management perspective, even a successful record company's cashflow is a case of feast or famine. You could release an album that flies, bringing in some nice revenue. But this tapers off and then may have nothing for many months. You are reliant upon artists to record songs that people want to buy so have little control or influence over your own destiny. The trick is to build a roster of artists so that you constantly have new content to push out.
He said that one of the biggest hurdles they faced with the Record Company was radio stations. If you want an artist to break-through, you really need their songs on the radio, even in today's streaming world. The trouble is, all of the main stations in the UK are controlled by just three operators: BBC, Global and Bauer and overcoming the gatekeepers of each is not without challenge and comes down to building relationships. He mentioned that because of this, it's necessary to be based in one of the two main 'media' cities in the UK; London and Manchester. His Record Company was based in rural Essex so being able to wine and dine and network with the necessary execs at a moment's notice was not that easy.
Publishing is where it's at. A music publisher tends to represent writers more than recording artists (but you can of course be both). But their primary purpose is licensing for films, TV, Ads, Games, etc. It's called Sync music and can provide a tidy revenue for both publisher and writer. It may not have escaped your notice that there is an enormous amount of content being created these days thanks to the advent of streaming. So, there is also huge demand for music. There's a chap in PH called GetCarter who will know a lot more about this side of the business.
A book recommendation for you: How Music Works by David Byrne (out of Talking Heads).
StevieBee said:
Lots....
Many thanks for your extensive answers ! Much appreciated. I'm just researching at the moment and did come across several companies like Boost Collective, similar to Emubands. I was starting to get the message that unless you're going in big and have a lot to offer, there's not going to be much demand for a small music business. I've got a couple of friends and myself who write music, or soundscapes, ambient probably more correctly named, and getting bored of IT I'm looking for a new, more artistic career.
Thanks !
SteveKTMer said:
StevieBee said:
Lots....
Many thanks for your extensive answers ! Much appreciated. I'm just researching at the moment and did come across several companies like Boost Collective, similar to Emubands. I was starting to get the message that unless you're going in big and have a lot to offer, there's not going to be much demand for a small music business. I've got a couple of friends and myself who write music, or soundscapes, ambient probably more correctly named, and getting bored of IT I'm looking for a new, more artistic career.
Thanks !
I'm on friendly terms with one Cocteau twin running a small independent label. Shouldn't be too hard to work out which one. Top & bottom of what he reckons after 25 years at it is it's a horrible business but he wouldn't want to do anything else, The whiole thing is shored up by the handful of successes, subsidising the rest. It's a real balance of commercial nous, cultural fidelity around the identity your fans come to you for & firefighting around tour logistics, radio play headaches, music press schmoozing & the whole A&R thing.
I also know the guy who set up Loopmasters, which for people who don't know, is a site selling Midi samples & presets for use in music production. That guy made A LOT of money out of it in a pretty short space of time & cashed out a few years back. No tempremental artists, no dodgy promoters, no ligging, no going to endless gigs sifting through hopeful bands. If it were me, I'd be looking at something around that space for sure.
I also know the guy who set up Loopmasters, which for people who don't know, is a site selling Midi samples & presets for use in music production. That guy made A LOT of money out of it in a pretty short space of time & cashed out a few years back. No tempremental artists, no dodgy promoters, no ligging, no going to endless gigs sifting through hopeful bands. If it were me, I'd be looking at something around that space for sure.
My brother ran an indie label late in the nineties and early noughties. One band had reasonable success (very popular in Japan) and got sold to a bigger label. Beyond that he did it because he enjoyed it and alongside nightclubs and the music 'scene'.
Edited by 22 on Wednesday 17th April 14:36
SteveKTMer said:
I've got a couple of friends and myself who write music, or soundscapes, ambient probably more correctly named, and getting bored of IT I'm looking for a new, more artistic career.
If you've not done so already, get your music on the many music libraries out there. Artist, Pond5, Adobe Stock... take your pick. Your fee per use will be small but the opportunity for scale and frequency of use is very good. And it only takes one of your beats or melodies to be used on a TikTok video that goes viral for you to start seeing some very nice revenue.
Thanks for the comments, I think I'll avoid this, it does seem that the time has passed unless you have something very profitable and unique, which I don't. I just thought it would be an interesting and maybe slightly profitable option but I don't think that's the case, at least not for me.
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