Why the Music Industry Needs More Artist-Friendly Record Labels

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Date:

July 2, 2021

Author:

Milan Kordestani

Entrepreneur, writer, and founder of 3 purpose-driven companies oriented toward giving individuals control over their own discourse and creation. Milan works to produce socially positive externalities through a mindset of social architecture.

Hi! I'm Milan, an LA based founder and writer, architecting impact-first businesses.

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In today’s article, I’ll be talking about the severe lack of artist-friendly record labels in today’s music industry. While I count my record label, Guin Records, among the most artist-centric labels in Los Angeles, the industry needs more labels that put their artists first. Additionally, I want to evaluate how deals with major record labels often end up hurting rising artists.

I don’t like to toot my own horn or make myself sound more benevolent than I am. At the same time, I’ve never been afraid to be honest and speak openly about my business ventures. For example, I designed my own label, Guin Records, around the concept of building and supporting up-and-coming musical artists.

With the help of my sister, Misha Kordestani, I developed this small record label to provide a platform for rising talent. However, rather than following in the footsteps of some record producers who take a lion’s share of the earnings while delivering minimal results, Misha and I took things in a very different direction. With Guin Records, we took our passion for hip hop and turned it into a label that benefits all parties equally.

My Own Experience Launching an Artist-Friendly Record Label

You’re probably asking yourself, what makes Guin Records so different from the thousands of other indie labels out there? On the surface, we handle business like most other labels. We scout talent, listen to demos, meet with unique and interesting artists, produce quality music, and promote the artists in our catalog. However, it’s what we do behind closed doors that really sets us apart as an artist-friendly record label.

First and foremost, we don’t believe in taking more in royalties than we need to operate our business. In this sense, Misha and I are very lucky. We don’t “need” Guin Records; it’s more of a passion project that also functions as a business. This means that we don’t go by industry standards that divide the royalties 90/10–90% for the label and 10% for the artist. Instead, we split all royalties right down the middle; 50% for us, 50% for the artist.

As you can imagine, this leaves many young artists practically knocking down our door to get in on a good deal. However, we maintain high standards for the artists we sign. Since I’ve been a fan of hip hop for years, I don’t sign any artists unless I can genuinely enjoy their music. Therefore, we maintain a relatively small, exclusive catalog of hip hop artists.

While this may sound exclusionary to the thousands of recording artists in need of a label, it actually allows Guin Records to better serve our artists. If we took on 50 new artists, we wouldn’t have the time to give adequate attention to any of them. Alternatively, with a small catalog, we can show each and every artist that we genuinely care about their success, providing them with the attention, promotion, and high-quality record label services they need.

Finally, we understand that creating art is not easy. Many artists have to maintain full- or part-time jobs while creating music in their spare time. So, we offer all of our artists a non-recoupable $400 monthly health stipend. Not only does this show our artists that we care, but it also gives them some extra help with bills so that they can spend more time focusing on their craft.

How the Music Industry Would Benefit From More Artist-Friendly Record Labels

Davido artist friendly record deal
Image Source: https://www.bellanaija.com/2018/05/davido-signs-new-artist-idowest-dmw/

I definitely don’t want to make it sound like Guin Records is the only artist-friendly independent record label in the game. There are dozens of other record labels that provide quality time and resources to all of their artists. However, like Guin Records, most of them have to keep a small catalog in order to provide high-quality service. As a result, the industry is in desperate need of more artist-friendly record labels.

Why is this the case? Because putting the artist first benefits everybody. As a label owner, you attract more talent when you show consideration for artists. At the same time, it goes without saying that artists will have a better experience working with an independent record label that actually cares about their well-being.

This brings me to the subject of major record labels and the deals they offer clients. It’s true that the biggest record labels can generally offer more funds upfront and a larger platform, but at what cost? If you’re a relatively unknown artist who happens to land a contract with a major label, you’re not going to get a favorable deal. You’ll likely get less than the standard 10% royalty rate. Moreover, you’ll have to abide by the strict rules and stipulations set forth in your contract.

Do you ever wonder why many recording artists refuse to “sell out?” It’s because major record labels are only interested in one thing: profits. If you sign with a major record label, you’ll be under their control for the duration of your contract. Not only that, but you’ll make a fraction of what your music is actually earning.

So, what’s the solution? Technically, there are two good solutions. First, artists can simply go out on their own and forget using any kind of label. With platforms like Soundcloud, Spotify, and even Youtube, this is no longer a pipe dream. Some of the most famous and successful artists in the world got started on these platforms or simply released their music directly to their fanbase. Chance the Rapper is a perfect example of an artist who just released his music to fans and remains an unsigned artist to this day.

If artists struggle to build an audience or simply want the structural support, they’re better off signing with a small, artist-friendly record label. As previously mentioned, most artist-friendly labels are notoriously choosy, which means it’s not always easy to find a label that will have your back and help build your career (without trying to control or manipulate you). Nonetheless, it’s definitely worth the effort to try.

Conclusion

Whether you go your own way or start sending your demo out to labels, you need to be aware of the pros and cons of signing any deal. There are probably 10,000 unsigned artists for every indie label that treats its artists well, which means the industry is in desperate need of more artist-friendly record labels. So, if you aren’t lucky enough to get on board with a label that really has your best interest at heart, you’re probably better off going solo for a while.

Originally published on Medium.

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