Building a Record Label
Navigating the jump from indie artist to record label boss.

The road from upcoming to accomplished is a long one, especially for indie artists. Pursuing a music career without the financial and technical backing of a record label is no easy feat. If you've successfully navigated the early stages of an indie music career and are now on your way to a full and happy career, you might decide to lend a helping hand to the people coming behind you. You might also decide to pool resources with other indie artists like yourself to make things easier on each other. Forming a record label is the best way to do it.

Building a record label is easier said than done. It's different from a band. Building a record label launches you fully into the world of the music business. No matter how great an artist you are, it takes plenty to be a successful record label founder. This is why successful music businessmen aren't always great musicians, Simon Cowell for example.

In this article, I'll be sharing some tips on building your record label. These are all things you may not think of as an artist but are very important to the success of your prospective label.

Know your vision

The first thing you must do before starting any sort of organization is to be sure what the goal and vision are. When you know what direction your label is going, it's easier to plan. What's the focus of your label? Will you focus more on finding raw talents and connecting them to bigger opportunities? What genre would you focus on? These are all questions you need to ask when starting a label.

When you have a vision in place, it influences what kind of structure you adopt, the artists you recruit, and the kind of music you focus on. If you ignore this, you'll end up moving in several directions at the same time and eventually running in circles.

Define your genre and audience

Traditional labels dip their hands into different genres as they please because of their deep pockets. Indie labels usually don't have that kind of reach. This means most indie labels end up focusing on specific niches within the music industry. So you don't have to be restricted to one genre, but you may want to gather artists that are similar and relate to the same kind of audience. Hip-hop and R&B, for example, are two genres you can easily pair up. This helps you streamline operations and reduces costs.

As your label grows, there's always room for expansion. Instead of trying to swallow everything at once, start small. Focus on your genre and steadily expand from there. You'll have to keep this in mind when recruiting artists.

Define the roles

When a group of friends comes together to start a company, it starts with no fuss and easy communication. Over time, however, if there is no defined structure, cracks will appear. Who is in charge of the money? Who makes the final decisions? Who is responsible for each department? These are all questions you must answer before you start a record label. A solid team structure prevents unwanted drama and complications later.

Put a team together and agree on the responsibilities. Who is in charge of scouting new talents and managing new artists? Who handles the negotiations? Is there a legal team? Start with as small a team as you think is effective, but make sure everyone knows exactly what role they're playing in the label.

Prepare the guidelines for signing a new artist

The main activities of a record label are putting out new music and bringing in new artists. While music production may be flexible to allow creativity to shine through, you must have a set procedure for bringing in new artists. What are you looking out for in upcoming artists? What kind of sound attracts you? What packages are you willing to offer them?

All these will help keep things in order so that you're not just running after every single talent with a nice voice. Your guidelines will depend a lot on your vision for the label. And your practice will depend a lot on your set guidelines.

Balance the books

Starting a record label costs money. Running one costs even more. Like I said, you're no longer just an artist. You're now running a business. So you have to consider the numbers. Count the cost of starting a record label, the cost of running it, and how you plan to turn a profit. In the end, record labels are after profit. While you may not go to the extent the traditional labels will go, it would be naive to think profit is not a major goal.

Without profit, there would be no music industry. So don't kid yourself. Understand how the numbers work. Make sure they all add up. Make sure your record label will be profitable.

Build connections

Your record label mustn't be an island. No one can prosper alone, especially in the world of business. Before you even think of starting a label and asking young artists to trust you with their futures if you don't have the necessary connections to make things happen. It's your job to find gigs for them, promote their albums, and help coach them to maturity. You need to know the right people for all these to happen.

Nail all the legal bases

As you would expect in an industry of such magnitude, there are many legal bases you have to cover. You must make sure you don't leave yourself exposed to being taken advantage of or sued for malpractice. Legal and financial expertise are two absolutes if you're to run a successful label. Register your business appropriately. Write comprehensive contracts for your artists. License all your music.

These are all legal bases that, if you ignore them, could cost you dearly.

Final Thoughts

Starting a record label is a noble pursuit, but it's no easy undertaking. In this article, I listed out some basic things you must consider. This is not the full list by any stretch. If you're truly interested in starting a record label, there's still plenty of research to be done. You should also study some successful label executives to learn from their mistakes and get some secrets about the business.

Godspeed, my friend.