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Let me break it down! advances are usually paid to an artist, songwriter, producer, against their future earnings! It can be on Live (against your live income ie concerts) , or Royalties ( $ from music sales ) or Publishing (publishing is a different topic on its own) #DoneaZi
It can also be one advance that covers all your future Earnings meaning it will be recouped from all the above rev channels I listed earlier #Doneazi
Now I know some people are already confused “me eazi dey speak grammar “ so I will break it down further #Doneazi
Let’s say you are a producer! Yes a Producer & you have been making beats in your room, dope ones , maybe one day @joeboyofficial jumps on one and it’s a hit, then @jderobie jumps on another it’s a hit, then @SympLySimi does same, it shows everyone your talent #Doneazi
Now from these 3 songs you have produced depending on the negotiation You can earn $ from Publishing, Royalties (revenue from the sales ) and or a fee. This fee can either be a 1 time fee or It can also be an advance against your future rev on the song #doneazi
A publishing company or a record Labelor a management company can come to you and say hey let’s give u 10million Naira, ( you can use this money to move out of your hood, invest in a business, buy better equipment etc ) how ever the new split will be 70% to you 30% to us
Here we go! Say the month later you produce for Wizkid & you charge him a fee of 1million Naira your management or label who gave you the advance will then take 300k as their Fee & then take 700k (which represents your 70%) this 700k will then be subtracted from 10m
Which means your balance is now 9.3m. Let’s say @UBAGroup then hears that song and wants to use it in their advert and they will pay 20million and let’s say your share 50% on sync when the 10m comes your management will keep 3million as their fee and take 7m against your advance
This means your balance is now 2.3M, now If say Korede Bello then comes and does a song with you & your management negotiates a 5M fee. They will collect 1.5m as their fee & from your 3.5M they take 2.3M & the balance goes to you! U have officially recouped.
Depending on the term of the contract after you recoup you can either collect another advance or maintain status quo untill the deal runs out or if the deal stipulates you can maybe Renegotiate. #Doneazi
Someone said “what if you don’t recoup” unlike a loan from the bank, no 1 can arrest you for not recouping if you are paid 10m naira and maybe those 3 songs were a fluke and you don’t get to make any more Bangas or no 1 wants to work with you well it’s on whoever paid
The reality is that unfortunately In the creative space you cannot walk into a bank and ask them for a loan telling them that “listen I am talented hear my song I’m gonna blow someday” lol nobody go listen #DoneaZi
Because it is not easy to know who is gonna blow or not, or to calculate the value of an emerging artist or producer or the fixed amount of investment that will blow an emerging artist! It is also almost impossible to access loans or generally funding as a creative #Doneazi
So advances end up being one of the few ways that a creative can get the cash needed to grow! In my case asides music streaming (which was maybe $1000 a month in Q1 2016) I got a loan in say May from my mentor @ChikaNwobi & that was the major capital I used to start my career
Before I open the floor to questions. In summary I will say Advances are not necessarily evil. You just have to know exactly what you are getting into, have a great lawyer , still go and read and learn, look out for the terms and if it makes sense go for it & don’t look back
