What if I told you that an artist could perform a $2,000 gig, be $2,000 out of pocket afterward, while five other people walked away with profit?
I've been revealing the screwed up things about the music business, and unfortunately there are so many, it's going to take quite some time to get them all out there.
Today I'm talking about something I've always believed is totally screwed up - the fact that many of the key players operate with a lucrative gross percentage game.
Managers.
Booking agents.
Lawyers.
Business managers.
All work on a gross percentage of the artist's income.
While the booking agent works on a gross percentage of live income, the rest work on a gross percentage of ALL income.
In case you didn't know, gross income is what an artist receives before costs are deducted.
Net income is profits or losses based on income less expenses.
These gross percentage folks take their commission from day one of the artist starting to earn anything.
Before I continue, let me state that people operating within an artist's business absolutely deserve to get remunerated.
But this gross percentage game is one of the biggest screwed up parts of the music business.
I'm sure you'd agree that a new artist is a 'start-up business.'
Start-up businesses need capital to grow.
Most CEOs spend more time securing funding than actually running their business because cash flow is so critical.
Without money, they don't have a business.
Imagine if a startup invested capital to stimulate growth, but as money started flowing, all of it went toward paying gross commissions to people meant to support the business.
The business would be starved of cash flow as soon as working capital was depleted.
Nobody would fund them because they'd never make real profits.
It's not sustainable.
Yet in the music business, this is entirely normal.
Let me present a scenario to help you understand this madness.
A new band gets momentum and attracts all the gross commission players.
They agree to work together.
The booking agent secures a gig paying $2,000 gross.
The band needs to rehearse to deliver a great performance.
They pay for rehearsal space and travel.
They hire a sound engineer for rehearsal time before the gig.
They rent a van to get to the venue.
Since it's far from home, they pay for a hotel.
Before doing the gig, they're already $3,000 in the red, putting expenses on credit cards while waiting to get paid.
But their gross percentage 'friends' are sitting pretty.
After the gig, the agent gets the $2,000 and deducts their 10% gross commission.
Now there's $1,800 left.
The rest send invoices to the business manager.
Manager gets $400.
Lawyer gets $100.
Business manager gets $100.
Let's also say they signed a 360 label deal where the label gets 10% gross on every income stream without doing anything to stimulate it.
The label invoices $200.
The $2,000 has been reduced to $1,000.
The band pays off their $1,000 credit card debt.
They're still $2,000 down while all their gross commission friends are in profit.
This is just ONE gig.
Imagine a full tour.
If you didn't realize it already, the entire music business is designed to take as much money from the artist as possible while keeping control of everything imaginable.
All the gross percentage players ensure they make good money by having big rosters of artists - often so big they couldn't possibly serve them all to the highest standards.
The artist does all the work.
Takes all the risk.
And ends up broke.
While everyone else gets rich off their labor.
This is why I made a promise to myself when I discovered this system - I would find a way to tear up this unfair, unethical and outright disgusting way of operating apart and create something fair to all.
You can't fix this by negotiating better gross percentages.
You fix it by creating a completely different structure.
One where the people supporting the artist actually invest in the artist's success, not just extract from it.
On September 10th in Mexico City, I'm revealing exactly how we're eliminating the gross percentage scam forever.
How we're creating a system where everyone wins when the artist wins.
Where risk and reward are actually shared fairly.
Free live stream for everyone who registers and a chance for 101 artists to be there in person (for free).
The gross percentage f*ck over ends here.
Kind Regards
-The Baker
Solving The World's Problems Through Art | #thetimetodoisnow