Questions about starting a label

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GoGoHarlemBaby
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Questions about starting a label

Post by GoGoHarlemBaby » Tue Feb 28, 2017 2:10 am

Hey Swirlers

It seems like there are quite a few board members who have started up record labels, it has always been something I wanted to do and I was curious about some of the logistics around it. If anyone who has started a label wants to share some wisdom, here are the questions that came to mind:

-Do you run it at a hobby or business? I know past results don't guarantee future performance, but what I'm getting at is do you see releases as cash out the door and you do it for the love of putting new music into the world or can one expect to break even/profit?

-Similarly, is it your full time or part time gig/how time consuming is it?

-How much start-up capital does one need for an initial release?

-Who on the pressing/manufacturing side do you work with? What is your usual run size/how do you handle limited editions? (i.e. will presses do small runs?)

-How do you structure deals with the artists you put out? Is there an industry 'standard'?

-Has anyone ever put out a reissue? If so, any pointers on what the process is/how to do it legally?

-Similarly, anyone who has put out live shows, are there any extra steps? I.e. do you need venue permission?

-How do you handle shipping/returns?

-Is there anything you wish you had known before starting a label that would've been beneficial?

Thanks in advance for any tips anyone has- also feel free to PM me if its stuff you don't want to share publicly

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arewhyehen
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Re: Questions about starting a label

Post by arewhyehen » Tue Feb 28, 2017 3:15 am

Done it as a hobby. I think this is the case for most.

There is a massive flood of basement labels now days and it has become more about who can make the craziest variants. Sadly I think that most people are not buying the records for the music anymore, but rather because of the wild variants.

Don't expect to make a lot of money from it. You do it because you are passionate about it and want to get the music out there..

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JonnyH
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Re: Questions about starting a label

Post by JonnyH » Tue Feb 28, 2017 5:11 am

Most of the pressing plants have pages where you can enter in how many and what colors and it will spit you out a quote.

There is not much money in selling music unless you are doing it at a massive scale. You also need space. Boxes of records and packing materials take up a lot of space. I handled distribution for a small indie label out of Seattle for a couple of years while the owner was living in Australia. My place at the time had several walk in closets and I basically filled one with all of the records and shipping stuff. My current apartment is a normal size 2 bedroom apartment and I would not have the space here to comfortably run the distro out of my place.

But I wish you luck! I'm a big fan of indie labels.

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shaneoftheroad
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Re: Questions about starting a label

Post by shaneoftheroad » Tue Feb 28, 2017 3:52 pm

arewhyehen wrote:Done it as a hobby. I think this is the case for most.

There is a massive flood of basement labels now days and it has become more about who can make the craziest variants. Sadly I think that most people are not buying the records for the music anymore, but rather because of the wild variants.

Don't expect to make a lot of money from it. You do it because you are passionate about it and want to get the music out there..
This is truth. I started a label last year (Tinker Tone Records) and pressed a whopping two releases before I realized I couldn't keep it going as a vinyl-only label. I wanted to stick with the traditional system of having a standard black copy with one collectible variant. But I've never been big on the crazy variants. I like the traditional color variants, glow in the dark or split colors. To make it now you have to have TONS of variants, each more wild than the last.

So, listen. If you're going to start a label you will absolutely have to have one of three things...

You're either going to have to already be a famous collectible label, which you're not. Or you're gonna need a well-known artist everyone wants to collect (someone famous, proven successful). Or you'll have to do the wildest, craziest, most revolutionary vinyl variants the world has ever seen.

If you have any one of those three things, you can make it as a tiny indie label in 2017. I'd like to add "release the most incredible music" but that doesn't work now unless you have one of the three things listed above. The basement indie market is just too flooded.

BUT there is always the wild card that is luck. If you're passionate about releasing music and don't care about losing money, go for it. I don't regret a day so far with my label. And though I had to amend my mission statement to include CD's and digital music, I'll never stop releasing vinyl when I get the extra money to do it. It is a satisfying endeavor, if you can afford it.

Good luck.

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shaneoftheroad
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Re: Questions about starting a label

Post by shaneoftheroad » Tue Feb 28, 2017 4:32 pm

Realized I didn't answer your questions. Let me try again.

-Do you run it at a hobby or business? I know past results don't guarantee future performance, but what I'm getting at is do you see releases as cash out the door and you do it for the love of putting new music into the world or can one expect to break even/profit?
It was a hobby for me, a passion project. I had some releases I wanted to see out in the world so I put them there. I had a lot more plans but ran out of money. Do not expect to make money. You will lose a LOT, especially in the beginning. If you can afford to keep pushing forward you may see profit one day but it's tough out there.

-Similarly, is it your full time or part time gig/how time consuming is it?
It was definitely part time. Can't make a living on it unless you get really, really lucky. It takes quite a bit of time in promotion and dealing with the artists. It's also a LOT of time boxing up/shipping out orders. Don't do it unless it gives you a thrill.

-How much start-up capital does one need for an initial release?
Depends on what you're wanting to do. Most of us do 7-inch releases with 300 or less pressed. This costs a total of around $1,000 (give or take, depending on the services you need)

-Who on the pressing/manufacturing side do you work with? What is your usual run size/how do you handle limited editions? (i.e. will presses do small runs?)
I went through Musicol out of Ohio. Aside from the sentimental aspect (they pressed the first Stripes singles, including the pink Lafayette Blues), they also had decent prices. My usual runs were 50 color vinyl and 150 black vinyl. The big cost in pressing records is in cutting and plating. Once you have those, you can press records for fairly cheap.

-How do you structure deals with the artists you put out? Is there an industry 'standard'?
There is no standard, as far as I know. I paid my artists with records and publicity.

-Has anyone ever put out a reissue? If so, any pointers on what the process is/how to do it legally?
Do you mean reissuing something someone else has already put out? That can be a somewhat complicated process, which requires going down the line figuring out exactly who owns every aspect of the release. Then you have to contact those entities and work out some kind of deal.

-Similarly, anyone who has put out live shows, are there any extra steps? I.e. do you need venue permission?
That's a good question about venue permission, since they are ultimately paying for the event. I don't know how to answer this one, I've never been involved in this type of release.

-How do you handle shipping/returns?
Charge actual shipping plus a little extra to kick toward boxing/preparation. If someone wants to return something, I always handled the shipping myself. Customer service is extremely important when running a tiny label. You really can't afford to lose even a single customer.

-Is there anything you wish you had known before starting a label that would've been beneficial?
Work harder on promotion. Hype the shit out of your releases every second of every day. Contact everyone, especially music blogs. Write up an exciting press release and send it everywhere, with photos. The whole package. Make it look as appealing as possible and never let anyone forget your release is out there. Push it hard every second of every day. Don't assume people will buy it simply because it's cool and on vinyl. Make them want it. Hell, make them need it.

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Melon
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Re: Questions about starting a label

Post by Melon » Tue Feb 28, 2017 8:46 pm

-Do you run it at a hobby or business? I know past results don't guarantee future performance, but what I'm getting at is do you see releases as cash out the door and you do it for the love of putting new music into the world or can one expect to break even/profit?
You will be a happier person if you see it as money out the door. Any profit is a nice suprise. (that being said set it up with a goal of breaking even/profit just don't count on it)

-Similarly, is it your full time or part time gig/how time consuming is it?
Part time. Time consuming when you release something and have to fulfill the order or when you're putting a release together. The time consuming parts come and go (unless you get bigger and are constantly making sales which doesn't seem to be the case at first)

-How much start-up capital does one need for an initial release?
7" probably 1,000 12" 1,500... thats the low end. Simple releases. If you want to go big it's probably closer to 1,500 and 2,000 but this all depends on
how many you're pressing and what not.

-Who on the pressing/manufacturing side do you work with? What is your usual run size/how do you handle limited editions? (i.e. will presses do small runs?)
Dosado/Palomino 100-250 tops.

-How do you structure deals with the artists you put out? Is there an industry 'standard'?
Band keeps all rights and digital sales (which they handle). usually give the band a portion of the records to sell themselves. Then once i break even we split profit on my end. IMO pretty artist friendly but I haven't been able to get many bigger artists to bite :D


-How do you handle shipping/returns?
No returns unless the product is broken then i'll replace it. USPS media.
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GoGoHarlemBaby
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Re: Questions about starting a label

Post by GoGoHarlemBaby » Wed Mar 01, 2017 4:01 am

Wow! Thanks everyone for taking the time to go so in-depth with your responses, you all gave me a lot of insights I could never have thought of on my own (especially coming up with the space to store inventory- I barely have enough space for my own collection). Definitely a lot of good stuff to think about and will hopefully help down the road in the event I find something to release and get to release it.

On a side note- maybe I'm a little old school, but it is really interesting to hear how much variants play into it, although being a TMR fan, I can't say I don't go for variants as well...Looking at what people are doing now with variants it's impressive, and I'm definitely behind the times haha

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shaneoftheroad
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Re: Questions about starting a label

Post by shaneoftheroad » Wed Mar 01, 2017 4:05 am

Have you thought of names for your label? I'll keep an eye out.

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Grimtale
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Re: Questions about starting a label

Post by Grimtale » Wed Mar 01, 2017 11:16 am

GoGoHarlemBaby wrote:Hey Swirlers
Thought I'd document this from my perspective because I get this question a lot via email from people. See my thoughts below...
Grim


It seems like there are quite a few board members who have started up record labels, it has always been something I wanted to do and I was curious about some of the logistics around it. If anyone who has started a label wants to share some wisdom, here are the questions that came to mind:

-Do you run it at a hobby or business? I know past results don't guarantee future performance, but what I'm getting at is do you see releases as cash out the door and you do it for the love of putting new music into the world or can one expect to break even/profit?
Hobby. To make day job money at this, you would have to go in deep investment wise and be very connected in the industry. Just my opinion. Unless you get into making 5000-10,000 copies of a release, there is no real money to be made and you would have to be connected to distribution & industry marketing and such to get to there. If you are talking indie label (few hundred copies per release), make it something you do for the fun.

-Similarly, is it your full time or part time gig/how time consuming is it?
It consumes a lot of hours, I'm sure each label is different but I'm guessing 100 hours per release on average. If you have a day job, that's a lot to add on top.

-How much start-up capital does one need for an initial release?
I'd go more on the $1500-2300 for a 7" release and $3000-5000 for a 12" release if you are doing variants, waxmage, alt covers, etc. My last two LP, I had 5k in them both. Don't forget,
you'll have to pay for mechanical rights (if cover or reissue), artist to assemble your stuff in the right templates for the presses, pressing fees, shipping fees, cover printing, ecommerce website fees (shopify for me), inserts, etc.
There are a lot of little $100 and $200 items that stack up. Could you do it for less, maybe but I'm just stating where my cost usually hover around for a full blown release.


-Who on the pressing/manufacturing side do you work with? What is your usual run size/how do you handle limited editions? (i.e. will presses do small runs?)
Gotta Groove Records (Matt Early & WaxMage girls) - Typical run under 300 copies all in with variants and such. Go back and do the math on that vs. a 5k investment. If you sell at $17 a LP, you are just breaking even... Don't do this for money, do it because its fun and you love doing it. Again, don't do this for money, you will be very sad at the end of the day if you do (operate an indie label that is).

-How do you structure deals with the artists you put out? Is there an industry 'standard'?
I pay artist via a number of copies of the record. There is no standard and it varies per artist & release. I have a number I throw out for most artist that is fair, some like to negotiate. Only twice have I paid someone royalties to press their content or get rights to the music and I ended up loosing a few grand on each release but I didn't care, the music needed to be out there on vinyl.

-Has anyone ever put out a reissue? If so, any pointers on what the process is/how to do it legally?
It's called mechanical rights, you pay so much per copy you print ($.10 or so per). Harry Fox via http://www.songfile.com/ is how you do it, pretty simple. I've paid as little as $40 and as much as $320 on a release (7 beatles songs). Most pressing plants have software that detects your submission is a reissue or cover and make you provide proof of mechanical rights before pressing.

-Similarly, anyone who has put out live shows, are there any extra steps? I.e. do you need venue permission?
If you record it live or steal it from the soundboard some how and produce it without permission from both the venue and artist, you could be in some legal shit... Best to talk to artist up front before the show and get something in writing, they should get compensated just as if it was a normal release. Don't forget most record pressing plants make you sign a legal document saying you own rights to produce the music. I have a contract that I use with each artist to keep me clear of any legal issues (please don't ask me for a copy, I paid money to have it developed and reviewed by a lawyer, giving it away wouldn't be fair to me.)

-How do you handle shipping/returns?
Shipping - Stamps.com, LP2844 label printer, digital scales, paper tape machine, boxes, lots of time and labor... About $400-500 capital investment up front I'd guess in getting it all set up right to ship like the pros do. / returns, you just eat it and smile, you are in the customer service business.

-Is there anything you wish you had known before starting a label that would've been beneficial?
Huge!!! Do not ignore this. Artist (musicians/bands) move at their own speed. I've had releases that have taken 2.5 years to materialize from the first conversation with the band and they said, hey lets do this. I've also seen where once I've shelled out thousands to the presses for the vinyl, still take many months to finalize inserts, alternate covers and what not working with the band, before I could sell them and recoup my money. Pressuring artist to move faster, just doesn't work. It all happens in the time it will take, don't try and force that. When an artist says I'll get you mastered versions in a few days, that might mean a few months, or two years.... hang in there and go with the flow. You are ultimately not in control or charge of the situation and if you force it, your artist may just walk away or disappear. Its their car and you are along for the ride.

Thanks in advance for any tips anyone has- also feel free to PM me if its stuff you don't want to share publicly
Good luck, don't let my model scare you. There are other labels that go simpler on their releases and it can work out quite well but it won't be free. Still looking at $1000 per release at the very, very, minimum. I still remember a 6pm Friday afternoon call about 6 years ago with Blackwell when he walked me through all of this and his model. I have an hour drive to and from work every day, if you can work within my drive schedule, I'd be glad to talk to anyone about what all is involved or answer whatever questions people might have about running a label.
Grim
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shaneoftheroad
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Re: Questions about starting a label

Post by shaneoftheroad » Wed Mar 01, 2017 1:46 pm

^^^^ Listen to this guy. He knows a thing or two.

GoGoHarlemBaby
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Re: Questions about starting a label

Post by GoGoHarlemBaby » Wed Mar 01, 2017 11:59 pm

Grim- as I said to everyone else, thanks for this information, especially the detail you went into on it. I appreciate the phone call offer and may take you up on it one day, but that day is still pretty far down the line when I get some more free time and some cashflow to get it going. I really appreciate the information on what you need for the reissues and the tip about working with artists!
shaneoftheroad wrote:Have you thought of names for your label? I'll keep an eye out.
Not yet man- this is my initial research on starting it up and there are a lot of directions I could see being cool to go, once I have a better idea of what sound/direction to move in I think I'd have a better idea about the name. Rest assured, White Swirl will be the first to know!

As a side note, I hope this thread helps out anyone else who is interested in starting a label- this forum has a lot of label owners who put out some really cool stuff so it is a great resource of information!

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Re: Questions about starting a label

Post by anonymousbrunette » Sun Jul 15, 2018 8:22 pm

Reviving this thread in case anyone has any further advice up their sleeves. I'm part of a new label that will materialize in 2019. Thanks to everyone for their insight.
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