Record Label FAQs

Frequently Asked Questions About Starting and Running a Record Label…

Record Label FAQs

How much does it cost to start a record label?

I suppose it’s possible to say that it can cost “nothing” but that would probably limit your marketing abilities and your distribution reach. A digital-only label releasing exclusively on Bandcamp can start a label for almost zero dollars assuming you have a logo.

On the other end of the spectrum, if you had an endless budget you could give your artist a $10,000 advance, register your trademark for $2000, hire a music attorney for $1000 to draw up a contract, press a vinyl run of 300 records for $2500, and hire a publicist for another $2500. Somewhere in between is entirely up to you and your available budget.

How much should the record label take from the artist?

Major labels have been known to take upwards of 90% of net sales. Mid-size independents royalty rates average between 50-75%. The most common royalty share amongst small indie labels is 50/50.

You can even offer a more lopsided royalty in favor of your artist, something like 35% for the label and 65% for the artist. Check this out for some help with managing your record label’s royalties…

How much should the record label take from the artist?

Major labels have been known to take upwards of 90% of net sales. Mid-size independents royalty rates average between 50-75%. The most common royalty share amongst small indie labels is 50/50.

You can even offer a more lopsided royalty in favor of your artist, something like 35% for the label and 65% for the artist. Check this out for some help with managing your record label’s royalties…

Can you recommend a lawyer, publicist, manufacturer, etc?

I often get asked about where to find vendors or reputable industry service providers. The best thing you can do is ask people you trust in the industry who they have used in the past. You can also find companies who have been previously hired by artists/labels you admire.

Also, I am compiling a list of hand-picked, trusted industry services that you can check out here…