DEBUNKING THE â€œMYTHâ€ ABOUT â€˜ADVANCESâ€™ IN RECORDING DEALS.
The word ‘Advance’ might not mean much to the ordinary man but to an artiste, it means the beginning of a great career. Little wonder it is one of the things that tempt artistes into signing a record deal.
This is especially true of upcoming artistes that have been striving on the streets of Lagos, Kaduna, Jos, Warri , Port-Harcourt e.t.c , hovering from music studios to lounges, nightclubs and concerts on their own naira solely to make their sound heard and get their big break ( i.e subsequently “blow”).
This usually comes with a lot of financial sacrifices with the uncertainty of finally becoming successful in this cut-throat world of the music industry.
This leaves a very little opening for the successful artistes with a lot of them giving up on the dream before they even get a chance for their big break. In other cases, a small portion of these artistes continue, with the hope that “one day, I will blow”.
Fast forward, a record label comes forth with millions of naira to sign and invest in such artiste, with the promise of a fancy duplex in Lekki phase 1 or VGC, coupled with a complete wardrobe overhaul, and a range rover evogue 2017 edition. The artiste comes excited with the feeling of “ I am now rich , I don blow”.
Then comes the reality check, the realization that such “gifts” are given as an “advance” on royalties. Advances are sums of money or gifts paid or given to an artiste on account of future royalties. They’re paid (or given) when the artiste signs to the label or during the term.
An advance is an advance (literally) and it’s an advance against royalties an artiste will earn on future record sales; the record label will definitely want a return on Investment (ROI). The full amount given as an advance is recoupable, it is advisable resist the temptation to spend the ‘advance’ money in a night on ‘popping bottles in the club’.
An advance, ordinarily should be shared with the artiste’s manager. However, it is also taxable: thus, an advance can “disappear” quickly. An advance sometimes can also be for recording costs, tour costs etc. It is important to understand that advances are recoupable.
Although, the thought of a large advance may get an artiste excited, but however, they come at a price. Advance is basically Debt and not free money, Debt that shall be paid back. Often, if the advance is large, there will be more pressure on an artiste to succeed immediately and also, the label is tied longer to the artiste as it has to recoup its advanced sum.
Recoupment of an advance is a process by which the label will first recover as against any of the artiste’s royalty income. An advance can also become a personal debt owed by the artiste to the record label which such artiste could be liable for at any time.
Thus, it is advised to opt for a smaller advance and aim to secure a higher royalty percent rate. Smaller advance also serves as a precautionary measure, because it protects against the uncertainty of becoming successful in the music industry. Nobody wants a case of “Had I known”.