From the course: An Insider's Guide to Today's Music Biz: 7 Record Labels

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Advances & royalties

Advances & royalties

From the course: An Insider's Guide to Today's Music Biz: 7 Record Labels

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Advances & royalties

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- Okay, now that you know what kind of commitment you're signing up for, now you want to know how much am I getting paid. So, let's talk about that. In exchange for those rights that we've talked about, the record label agrees to pay you a cash advance and a royalty for each record sold. First, let's talk about these advances. Once you've made a deal, the label will typically pay the artist a cash advance against your future royalties. That advance is called a quote on quote fund and it's used to pay for all the costs of recording the masters, including studio time, producers, engineers, musicians, pizzas, lattes, and anything else you might spend. Hence the term all in, which means that that advance covers all the cost. Any money leftover goes to the artist. Now, the amount of the advance or the quote on quote fund will depend on your stature in the business and your record selling potential. So, for a brand new artist signing to a major label, the fund's likely to be anywhere from…

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