April 8, 2026

Record Label Wants 50% | Music Business Newsletter

Show Notes
Transcript

In this episode of the Music Business Newsletter with Matthew Rix, I read an email from a singer-songwriter in Milwaukee, Wisconsin who’s being offered a record deal and something about it doesn’t feel right.
Here’s what the label is asking for:
• 50% of all royalties
• 50% of publishing
• Rights to re-release his already completed album
• No upfront money
• A 5-album deal (all company options, no artist control)
• And recoupment on future recordings
In other words… the artist takes on most of the risk, while the label takes a large portion of the upside.
In this episode, we break down:
• What labels should actually provide in exchange for ownership
• Why giving up publishing early can be a major mistake
• How recoupment really works (and why it matters)
• The danger of long-term deals with no artist options
• Red flags that signal a bad or one-sided deal
• And when staying independent is the smarter move
This isn’t about being anti-label.
It’s about understanding leverage and knowing when a deal helps you… versus when it holds you back.
If you’ve ever been offered a deal or wondered what to look out for, this episode will give you a real-world breakdown.
Have a music industry question or situation you want help with?
Send it to http://MatthewRix.com include as many details as possible so your story can help other artists too.
#recordlabel #musicindustry #musicbusiness

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Hey, this is Matthew Rix and today on the Music

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Business newsletter, we got an email. We're going to subject

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this one label wants fifty percent of everything from this artist,

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no advance, and he's asking this question.

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Is he crazy for questioning this?

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So before we dive into that email, if you got

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a question on the music industry that you'd like for

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me to answer, go to Matthewicks dot com click submit

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your question, give me as many details as possible, and

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we will answer the question or the email here on

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the channel.

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Now for the email.

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Before we dive into this email, I just want to

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say I think it's very common for you as an

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artist to get approached by quote unquote record labels with

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this sort of deal. We're going to be kind to

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him because he didn't sign it yet, so if he

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would have signed it, we would roast him a little

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bit harder. But I think if you've been in music

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for a while and you have minimal to no traction,

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it doesn't take much to get a label like this

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to approach you. I think we've all heard of stories

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like this, or you know someone who's had a label

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approaching like this, or maybe you've even signed a deal

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like this. So before we dive into this email, just

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know that if anybody wants to take fifty percent of

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something that you've done all the work and put all

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the money up in and they're not going to give

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you a dime for it, we need to run as

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fast as we possibly can.

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He says.

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Hey, Matthew, I'm based out of Milwaukee, Wisconsin.

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Love Milwaukee Go brewers.

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They always beat the cubs, So that's all I can

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ask for, he says. I'm a singer songwriter who's been

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grinding this out for a while now. I write everything myself,

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play shows pretty frequently, mostly around the Midwest, and about

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a year ago I recorded and self produced and released

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my own album.

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I paid for it out of pocket, paid.

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For musicians, recorded most of it at home, had it

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mixed mastered professionally, and put it out through distro Kit.

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Sounds pretty self reliant. So far, good for you.

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I do wonder when you say you recorded this at home,

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like did you have like drums? I love stories like

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this and some of the best albums have always come

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from like you see the pictures of the videos and

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the drummers like recording. He's just playing and there's like

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Big Dude's beds in the background. It's just like indie

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and I love it.

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It's so beautiful, he said.

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The album is not massive, but it's doing something. A

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few songs are sitting around sixty thousand streams. That's that's

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I mean, you released an album as an independent artist

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and you got a couple of songs at sixty thousand

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streams for your first album. Not bad for doing it

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all yourself, he says. I've built a small but real

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following locally, and people actually show up to my shows

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knowing the words. What else could you ask for starting off?

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I mean, you released an album a year ago, you

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got people showing up to your shows. They know the

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words of the songs, so that's great. They're not just

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coming because it's you know, two for one Mick Ultra

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Night at the b or whatever. You're getting sixty thousand

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plays on a stream. Everything seems like you're moving in

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the right direction right now, he said.

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For me, that's been a big win.

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I think for a lot of artists starting off that

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would be a that would be a big win.

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And I love that you look at the small.

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And you find the beauty in it instead of being

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like I'm not getting six million streams under this sucks.

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I'm going to band camp anyways, he.

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Says, recently, I got approached by a small record label,

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not a major, but they've got a roster, some decent

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looking branding, and they talk like they are connected.

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Hey, what label did you sign with?

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I signed with Bob's label out of Kanka Key, Illinois.

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Huh why'd you sign with them?

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They got decent looking branding, they got a roster, So

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what's the roster doing. We don't know what the roster's doing,

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but we're just we like their branding. Maybe they got

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a cool merch store. I remember years ago there was

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a label that popped up and everything they signed was trash.

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They had more money than like.

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Brains, and these guys were they were real estate guys

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who got out of the real estate. They wanted to

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play rock and roll, and I just they threw money

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at everything. But the bands they signed were like you

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listened to like they got this new signing and they're

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really they're really hopped up on it. He'd be like,

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I'm sorry, is this ten years ago? Like this is

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so outdated, and they would just throw money at it.

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But you walked into their office. They hadn't released it,

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they had released a single release yet, but you walked

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into their office, beautiful hardwood floors, signing on the door

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like they they The branding of that label was amazing.

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And about a year and a half later, they closed

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up shop, locked the keys, you know, locked the door,

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locked everybody out.

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Artists didn't know what to do.

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They couldn't get their masters, and they had good branding

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as well.

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Yeah, that label was horrible. Anyways.

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I like also how you say they talk like they're connected,

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so we don't know if they're connected, but they do

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throw around some buzzwords.

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He says.

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At first, I was excited, felt like maybe this was

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the next step. But now that I've seen the deal,

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I don't know what to think. Okay, well you came

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to the right place. Let's break down this record deal

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from the record label that has a roster but they

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have really cool branding.

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He says. Here's what they are offering.

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They want to re release my current album under their

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record label. No upfront money, no advance, nothing, all right,

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right then and there, we.

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Don't even have to continue reading the contract.

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You put up all this money, both, you did so

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much equity, both sweat and financially.

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You put this album out yourself.

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You got some songs up to sixty thousand streams, people

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know your songs.

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This label comes in, goes that sounds great.

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We just want to take it, not even slap our

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logo on it because it's digital, so we just want

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to put our logo at the bottom of it on Spotify,

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Apple Music, whatever.

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And how much do they want for that? You think, well,

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here we go. They want fifty percent of all royalties

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from the music.

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So you put all this effort into this, you put

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your money in, you spend time self producing it, you

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paid to get it professionally mixed and mastered, and they

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want fifty percent of the royalties. He says, Then they

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want fifty percent of my publishing, which I currently own

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one hundred percent of. I mean, fifty to fifty publishing

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is industry standard, industry standard, fifty to fifty publishing. But

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not on something you've already done, not something that's been

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out for a year now. They want to come in

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and grab the publishing.

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He says that.

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I say that they'll fund the next album, but that's recoupable. Okay,

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that's standard. I don't you don't tell us what the

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point structure is on you recouping. I'm sure it's probably

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you know you'll recoup at five percent, or it's the

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flip side, it's like you'll recoop it like something like

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so like, which is just like ridiculously high for an

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artist to get.

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And I'll explain why in a second. He says.

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It's a five album deal and every album is a

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company option. I don't get to decide if we continue

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to work together or not. They do, well, yeah, that's

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not great, he says. So basically, they get half of

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everything I've already built, half of everything I create moving forward,

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and control over whether I'm locked in for up to

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five albums.

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And here's where it starts to feel off.

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That No, it's not. This is where it starts to

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feel off. This thing is already off.

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You're going to do.

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You're gonna do a five And now I don't know

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if it's in the contract you didn't say, is there

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terms on when they got to get the next album out?

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Or can it be we're gonna pick up your option

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because I've seen labels do this before. We're gonna pick

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up your option for album two. But we have no

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clue when we're gonna actually start working on album two.

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So they pick up the option, and then you can

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sit for five years, you can sit for ten, you

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can sit the rest of your life while they're still

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recouping the first album or getting the right producer. It happens, okay,

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And a lot of times small labels will play that

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game while they're waiting for the money to come in.

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The majors will play that game because they're just screwing

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with you. They don't want to release you because they

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don't want you to go somewhere else, but they also

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don't want to work with you and put more money

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into you. So that's why anytime you have a recording contract,

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anytime anybody wants to do a contract like that and

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it's five albums, and you don't get to say, there's

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gotta be there's got to be a window in there

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of when they're gonna start working on the next album,

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album two, album three, whatever. So that way they don't

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pick up the option for album too, and then you're

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sitting for twenty years when they're gonna decide, because they

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hold all the keys here and fifty percent. So my

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question is is it. So it's a fifty to fifty

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deal on this song, on this album. Is it a

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fifty to fifty deal on the next albums that they're

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paying for? Because that doesn't smell right either, you know,

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said He says, Uh, here's where it starts to feel off.

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It's alrighty, all of this is already feeling off, but

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not for you.

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He says.

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They're talking about a lot of exposure and taking things

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to the next level industry buzzwords. But when I asked

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for specifics, like what exactly are they going to do

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differently with this album, the answers are vague because they

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don't know what they're talking about.

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You know, they're gonna they're gonna send out a post

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on Facebook and the millions of streams are gonna just

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roll in from that. He says. They say stuff like, well,

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pitch to our network. What network? Who's there? Okay? He says.

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They tell us that they have relationships with Spotify playlist curators.

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He says, we'll get you in front of the right people,

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but nothing concrete, no marketing plan, no budget breakdown, no

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clear deliverables. You won't necessarily get a marketing plan until

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you sign because why would I give you my plan.

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You can take that plan and run off and go

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do what you want with it.

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You're not gonna get a budget breakdown until you sign,

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because I don't want you posting my budget. The budget

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is that's telling how much money we're gonna put into it.

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So if you're not signed and I give you my

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budget for your album, you could take that to another

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label and then my budget's gonna go up because you

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can get I can get into a bidding war, and

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that's not good. So that right there is not scammy.

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That is them protecting themselves. However, when they say that

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they have relationships with Spotify playlist curators, you do have

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every right to go back and ask them like, well,

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can I talk to this person like you like, let's

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do a three weekle. I don't even have to have

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their number, but I need a vouch trust. But verify

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what Ronald Reagan always said. I would ask them to

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clarify what pitching to their network means and who are

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the right people?

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Is that booking agents? Is it press? So?

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I mean, honestly, if they have a roster of artists,

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you should be able to text those artists send them

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a DM see what the label has done for them,

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because no matter what they say, if they got ten

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artists and you hit up ten and ten of them

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get back to you, you're gonna probably have six or

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seven who will be brutally honest with you. And then

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you'll have three who are you know, they're either drunk

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on hopium or they hate the situation. But you should

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be able to get out of ten. You should be

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able to get seven to be like, this is where

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they're good at, this is where they're bad at whatever.

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When I worked for when I worked for startups, you'd

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always have an artist.

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When you're talking to a new artist, you would point

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them to.

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An artist on the roster already and just be like here,

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and I would just give the phone number because I

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was like, I got nothing to hide, like you all

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build a relationship whatever.

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That way, also just gonna be honest with you.

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Some artists can get crazy. I mean, look, I'm a

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little crazy. Artists are crazy and sometimes are crazy. Is

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just don't blamed, right. I would like them to talk

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to the artists, have the artists sell the label, because

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then if the artists that we're gonna sign gets crazy

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or whatever, they're not gonna really blame me.

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They're gonna blame the artist that wrote them down. It's

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a little trick right there. He says.

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They'd also mention they'd help with radio and playlisting. Well, yeah,

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because they know Spotify playlist curators, so they should be

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able to help with playlists, and which I guarantee you

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they don't know Spotify playlist curators with radio, but he says,

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but they hinted that it might need but might need

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to chip in for additional promo campaign. So you're giving

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them fifty percent of your royalties on an album that

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you paid everything for that's already out, and they're going

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to take that album and promote it, but you're gonna

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have to chip in for additional promo campaign. Not a

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fifty percent, you're not. Yeah, I will, y'all put me

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in contact with your people. I'll give you fifteen percent.

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I'm keeping eighty five and I'll pay for this stuff,

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he says. They tell me that I'm gonna have to

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chip in for additional promo campaigns if I really want

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to push things, which immediately raised a red flag for me.

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Yeah, it would for me as well. This whole thing

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is a red flag. I'm telling you, I keep saying

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I'm gonna buy a red flag. This whole thing's a

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red flag, he says.

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Another thing that pissed me off that is buried in

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the contract is a clause where they can cross collatterize everything,

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So meaning if the next album doesn't recoop, collateralize yeah,

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collateral Yeah, the next album doesn't recoup, they can pull

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from the current one, which I already paid for myself. Well, okay,

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when you get signed to a record label, they don't

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break it down release by release. When you're looking at recoupment,

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it's this is how much money we have spent on

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you total, and then that's where the recruitment comes in

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a lot of times, what artists don't realize is if

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label has put a million dollars into album one and

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you're sitting at like nine hundred thousand recoop, they're gonna

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probably start ma in the next album. The The goal

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isn't to get you, not to recoup, because they realize

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that there's momentum here and so it's time to keep striking.

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So that is actually it shouldn't piss you off because

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they're pulling from all releases. I don't like the way

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they worded that, because it should just be you know,

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Bob the artist, all of your money goes into this account.

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This is this is how you recoup, this is how

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you get paid royalties, this is how you get.

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All of that.

302
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So I don't really I mean, out of everything you've said,

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that's kind of that in publishing one of the most

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common things that one shouldn't really give you a lot

305
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of concern. That is pretty standard. But there's got to

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be something different for the first album because you've already

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paid for it. I mean, technically, what they should do,

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what a normal record label do, is that they wanted

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to pick up your album, They're going to pay you

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for that album them, They're gonna buy the masters from you.

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Then they can basically recoup against.

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That kind of thing. He says. Let me get this straight.

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I fund the first album, they take half of it,

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then they fund the next one on paper, but I

315
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still end up paying it back before I see anything.

316
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Yep. And they control the whole timeline yep. He says.

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I'm trying to stay level headed, but it feels like

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I'm being asked to give up ownership and control in

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exchange for a potential. That's exactly what they're Yeah, that's

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you're giving up. You're giving up half of everything for

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a possibility. He goes, So here's where I need your help.

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It's just how deals look at my level? Or is

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this as bad as it feels? Some of it's pretty standard.

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But the things that.

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Are bad are are really bad. I'm gonna be honest

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with you.

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I don't think in this day and age, I don't

328
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think a lot of record contracts are good unless you

329
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get a really good lawyer and you've got a lot

330
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of heat and they're gonna bend a lot to you.

331
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A lot of them aren't good.

332
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This one is horrible. This is absolutely horrible, he says.

333
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Does it even make sense to give up fifty percent

334
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of my publishing this early? If you're going to sign

335
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any deal with any record label or any publishing house,

336
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you're gonna give up fifty to fifty. Doesn't matter how

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big you are. I mean, unless you're you know, Taylor Swift,

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But fifty to fifty is very common in the music industry.

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He said, What should a label actually be bringing to

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the table if they want half of everything? No label

341
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is going no legit label is going to want half

342
00:17:33.079 --> 00:17:35.799
of your royalties for your album.

343
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It's just it's not going to happen.

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And then typically what would happen is is that you

345
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would do a licensing deal for that first album. You

346
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give some money to you, and then they the contract

347
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actually gets executed at the twelve points royalties fifteen whatever

348
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on album too. When they're putting all their money into

349
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the first album, typically when it's already been released and

350
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you purchase it, you pick up the masters. You're doing

351
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that because the album's popping off. You want to just

352
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get the artist off the market, and so you might

353
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rebrand it, you might put it out there, you might

354
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throw an additional one or two songs, but typically you're

355
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flipping that album quick to get the album number two.

356
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Because you also realize that things been out there for

357
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a while, the diehard fans already have it there.

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The story's kind of somewhat already been written, he says.

359
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And am I better off staying independent if this is

360
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the kind of deal being offered this kind of deal, Yes,

361
00:18:34.000 --> 00:18:36.480
it's better to stay independent. It absolutely is, because you're

362
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giving away fifty percent of everything, and what are they

363
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gonna do? And then you're gonna have to chip in

364
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and help your Here's here, let me break it down

365
00:18:42.599 --> 00:18:44.759
like this. You're gonna get You're gonna sign away fifty

366
00:18:44.799 --> 00:18:48.039
percent of everything to help pay for your promotions. Well,

367
00:18:48.279 --> 00:18:50.079
you can pay for your promotions and keep one hundred

368
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percent of everything.

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And if they do have.

370
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A Spotify playlist curator and it's legit and I'm wrong here,

371
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pay them a licensing fee, give them fifteen percent. They

372
00:19:00.960 --> 00:19:03.960
can market the album, you know, because if they can

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put you in front of the right people and they

374
00:19:05.319 --> 00:19:08.000
actually know the right people and you can verify that

375
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they do, that's where you go to the artists on

376
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the roster and you say, hey, they say they know

377
00:19:11.680 --> 00:19:14.119
playlist Spotify playlist curators.

378
00:19:14.119 --> 00:19:17.240
Tell me that experience, he said.

379
00:19:17.079 --> 00:19:19.319
I've worked hard to get to this point without owning

380
00:19:19.480 --> 00:19:22.039
owing anyone anything. The last thing I want to do

381
00:19:22.119 --> 00:19:24.319
is sign something that puts me in a worse position.

382
00:19:24.960 --> 00:19:28.039
You are from the start of this email.

383
00:19:28.039 --> 00:19:31.319
Where you talked about how you created this process, how

384
00:19:31.319 --> 00:19:33.680
you created the album, the steps you've done for this album.

385
00:19:34.599 --> 00:19:38.839
You've been very smart. You got sixty thousand streams on

386
00:19:38.880 --> 00:19:43.079
a song. It's a great first step. Now you're being

387
00:19:43.119 --> 00:19:48.000
presented with this terrible deal, and you're realizing this is

388
00:19:48.000 --> 00:19:50.559
going to put me in a worse position, Like most

389
00:19:50.640 --> 00:19:54.160
artists do get kind of like like weirded out by

390
00:19:54.720 --> 00:19:56.960
fifty to fifty publishing at first, until they realize that

391
00:19:57.000 --> 00:19:58.480
it is industry standard.

392
00:19:59.119 --> 00:19:59.759
That part.

393
00:20:00.279 --> 00:20:02.799
I want to if you're gonna not want to sign away,

394
00:20:02.799 --> 00:20:05.759
you're publishing. You're never gonna get a deal or you

395
00:20:05.799 --> 00:20:07.680
need to play arenas as an independent artist, and then

396
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