Interested? Ah, now that I’ve got your attention, let’s chat about it. Independent artists imagestalk about wanting/needing millions of dollars but they don’t seem too keen on talking about HOW they plan on making it. Saying that one of your goals is to make millions of dollars if fine, but exactly how to plan to accomplish that? It won’t be handed to you after you release your new single, so what IS the plan? Do you have any real concrete ideas or have you mapped out month by month, year by year, how you will accumulate that much wealth? This is a business and you must plan. Musicians tend to recoil when you ask HOW they will make their millions. It isn’t fun to look at the reality of playing crappy bar gigs for $50 a pop. But if that IS your reality, only you can change it. If you can’t sit down and write out on a piece of paper where you are with your bills and income, how will it ever change? Avoiding it waiting for a miracle won’t help. You will just become more frustrated and you may even start spending more money desperately trying to find the golden goose that will lead you to the mountains of wealth. A better idea is to start planning for your financial future.

Don’t stop reading, you need to face this reality. You CAN make money in the music business if you are realistic, willing to be patient while you build your business and stop being ridiculous about how much you can earn. The odds are against you ever making millions of dollars as an independent artist, but that doesn’t mean that you can’t make a great living. All the bling and over the top Rock Star lifestyles you read about, and see flaunted on TV and the web, can be somewhat of an illusion. Many artists signed to major labels don’t control their money, the labels do. When their single doesn’t sell or their tour is a flop, the money disappears. There have been numerous artists who are household names who ended up bankrupt. Some weren’t keeping up with where the money went and others just spent more than they could afford. It’s a common story in the industry you hear about managers, agents, promoters or labels ripping off artists who couldn’t be bothered to pay attention to the business because their “team” was handing that. They were busy creating art. When they realized they had been drained dry,  it was too late. Also, if you are signed to a Major Label who records, produces and promotes your records, not to mention tours, that is essentially a loan, which you are expected to pay back. When you see your royalty check, it will become all too real.

Quoted in an interview with ABC news, Toni Braxton opened up about what drove her into bankruptcy. Despite $170 million in worldwide sales, from hits like “Breathe Again” and “Another Sad Love Song,” Braxton said she got a measly $1,972 royalty check from her first recording contract. In the music industry, the artist is responsible for paying back the record label for all kinds of costs including: clothes, travel, studio time and music videos. What happens is they give you advancement on the next record and then the next record,” explained Braxton. “So you kind of stay in debt, in a sense.

Sobering isn’t it. A huge superstar who ended up bankrupt and considered posing for playboy in order to take care of her kids. Not what you imaged could happen to someone with huge hits, rights? She is just one of many. What about MC Hammer?MC Hammer had an entourage for the ages: a 200-person crew that reportedly cost him $500,000 every month. According to Forbes, Hammer pulled in $33 million after his Diamond-selling album Please Hammer, Don’t Hurt ‘Em was released. It only took six years before he found himself in bankruptcy court claiming assets of $9.6 million compared to debts of $13.7 million. He even owed $500,000 to NFL-star-turned-analyst Deion “Prime Time” Sanders.

So how does this happen? Artists don’t plan out their finances, they don’t start from the first gig being responsible about money. Then, when they get in a position where they are making lots of $$, a myriad of things can go wrong. If you are not watching your money, if you are trusting someone else completely and never checking the books, be warned. You could lose it all. They will never be a time when you can take your eye off the ball. Never.

millions-to-bankruptcy

When Lady Gaga got injured on her Born This Way Ball tour, it was estimated that 25 million in ticket sales would have to be refunded. Billboard reported in February 2013…

“Last week, Lady Gaga canceled the remaining dates of the North American wing of her Born This Way Ball tour, which has been crisscrossing the globe since April. Her announcement came with the news that she will require surgery for a hip injury that’s resulted in a condition known as synovitis, which she first revealed upon postponing shows  in Chicago, Detroit, and Hamilton, Ontario. Naturally the decision to nix the massive production has led to a great deal of discussion.

Most recently, Examiner.com has claimed that it was concert promoter Live Nation that actually called for the tour’s demise because the dates were underselling. They shakily cite the fact that the cancellation news was in fact credited to the events organizer instead of Mother Monster herself, and quote “two reputable” but unidentified sources who suggest that Gaga is exaggerating her medical condition in order to curry public  sympathy and distract from the truth.

Said one anon: “It wasn’t that ticket sales were disastrous, but they weren’t good enough to justify the huge production cost. I truly believe Lady Gaga is making her ‘injury’ out to be a lot worse than it is. This is definitely a cover-up.” While the other unidentified source added: “They lost a lot of money on this tour, especially in South America. North American ticket sales were fine, but not nearly as well as expected. They had to give away a lot of tickets.”

So you see, no one is immune. As an Independent artist it’s all up to you to handle your finances properly. Open a checking account for your band, keep up with all monthly revenue and pay outs. Keep all receipts and be diligent about documenting your expenses even if it looks bleak right now. Until you take control and start to plan your success in very real terms, it will never happen. You won’t go from broke to millionaire overnight unless you win the lottery and those odds are one in 17 million.

For up and coming artists who reach national recognition and even get Grammy nominations and/or wins, the money starts to get better out on the road. But the majority of the money goes to the headliner in the band, the front person. Being friendly with and speaking to many promoters over the years, and being out on the road, you learn what the money REALLY looks like. A big name on the rise makes anywhere from 8 to 16K per concert, but their band gets paid scale. The money really hasn’t changed much since the early nineties. Scale for a touring musician with a big National act is $600- $1000 per week. Not exactly crazy money, but that’s pretty typical. Usually the management company decides what band members will be paid and it’s not alot. But if you love what you are doing and you love to travel, that may be plenty!Don’t be naive if you are a side man with a band that explodes. The front person is usually the “star.” The “star’ makes the money, not you. You will probably never know what they are being paid. Lots of bands who were tight before getting national or internationally recognition, end up distant and just work colleagues on the road.  You may not even get to tour with the headliner. The management company or label, if there is one, may choose to use studio musicians. Two years ago when Melissa Ethridge toured she went out with young studio musicians from NYC. Her regular band wasn’t part of the tour. This is a common practice and makes it easier for promoters when they are dealing with hired guns.

Obviously we aren’t talking about iconic bands here where all the members have acquired amazing fame. But compared to the tens of thousands of bands out there, that is very rare.

So what can you do to secure your financial future? Start planning now just as you would with any other business. Don’t wait saying, “well, I’m not making any money.”If you opened a new restaurant tomorrow, you wouldn’t know exactly what you would be bringing in every month, but you need projections in order to even be profitable. You estimate your overhead starting with what you know and then you give your best educated guess as to the rest of the bills. You know what your gigs pay, how much merch you are selling and if you sell Cd’s at gigs. Then look ahead and all the creative ways you can make money moving forward. And you HAVE TO GIG TO MAKE MONEY!!Trying to become a well-known artist without ever gigging makes zero sense. People need to see live shows, and you need the street buzz and connections. Look at every possible avenue for making money, streaming online shows, crowd funding when it’s applicable and you have a solid fan base, teaching, session work and on and on. You would think it was crazy if  restaurateur told you that they were just waiting for their business to explode before they kept any books or had records for their expenses. How long do you think that restaurant would be in business?Not long. The music business is as risky and volatile as the restaurant business. Even more reason to be organized and plan now for your future.

There’s no reason why you can’t make a great living as a musician, but you need planning, organization, dedication and most of all you have to be realistic. Start your financial plan today. What are you waiting for…MONEY makes the world go around!

 

 

 

 

4 Responses to MONEY

  1. Thank you for the knowledge it is very helpful and motivating! 🙂

  2. Nikki G says:

    I have been thinking about this ever since our last meeting. As a manager, it really makes me think about my business plan and how I am a little nervous about excelling to the touring stage. Not that I cant handle it, but it is such a comforting feeling to have Fame Wizard on my side to give me the confidence that I will be okay. As for the musicians, they are also going through the trial and error. It is so important they study up on this one and be realistic and aware.

  3. Dennis Long says:

    The Music Business is just that – 1/2 Music, 1/2 Business. Unless you are a hobbyist, or “weekend warrior” you need to spend equal time on both halves. I think that the “new” music business models were actually inevitable, and not altogether a bad thing. It’s more like we are all entrepreneurs like the owners of the new florist shop down the street. I think the restaurant analogy was a good one. Unless we can provide what the buying public wants and somehow manage to keep in people’s minds when they are hungry for entertainment, we will not succeed. And, unlike our government, we cannot spend more than we take in and remain solvent, so we must know at all times what we are taking in, and what we can afford, and what will give us the best result for the money spent. Boring stuff, but it makes a difference.

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