Early on a recent Saturday morning, 14-year-old Mitchell Gaddis planted himself in a seminar to learn how to start his own company. His chosen field: music.
A decade ago, most kids his age with aspirations of music careers focused on performing. These days, however, the high-profile successes of independent label executives have made the business side of the music industry more alluring to youngsters hoping to strike the notes that sound “cha-ching.”
“My brother was telling me, breaking down the numbers as far as how artists get paid,” said the Chicago teenager. “If you want to be successful in this business, and not get played by a record company, you’ve got to try and do your own thing. The money is where the business is at.”
That led Mitchell and others to a music seminar presented by radio station WGCI with Master P, the hip-hop mogul who guided No Limit Records to $200 million in sales last year. The past few years have seen a resurgence of interest in independent labels. Only one major record distribution company had higher sales in 1997 than independent releases, according to SoundScan, which tracks record sales.
“A lot of people, for what it would take to pay for a good used car, could get the equipment they would need to record their own material,” said Joe Levy, senior music editor at Rolling Stone magazine. “If you tap into the right community and the right cities, the records seem to sell themselves.”
While many performers resort to selling tapes and CDs from trunks of their cars when they can’t strike record deals, others choose that route first because it’s often more profitable than taking their music to major labels, where artists fear they will be jilted or their music compromised.
That’s particularly true of hip-hop, which thrives on street credibility–something not traditionally found at the top levels of large music companies.
“The success of Death Row, No Limit and Suave House definitely inspire people in hip-hop,” said David Bry, an associate editor of Vibe magazine. “One of the things most interesting about some independent labels is their action against the major labelization of hip-hop.”
CDs can be manufactured for about $1,000. Independent distributors like Cargo in Chicago, Caroline in New York and Revolver in San Francisco put the music in stores.
Money to start these labels often comes from family and individual savings. And there is an increasing number of models for aspiring entrepreneurs of all backgrounds to choose from. Master P, who grew up in a poor New Orleans neighborhood, started his company with about $10,000 he got from his grandmother. His records were successful, primarily from sales in the South, without the benefit of a major distribution company.
“In hip-hop, people start labels and two years later they’re selling millions of records,’ said Eric Boehlert, a contributing editor for Rolling Stone. “It’s much more word-of-mouth, and once the right people hear about records, they pass it along.’
But it’s not nearly that easy to make bucks as a newcomer, said Pat Bradley, executive director of the Association for Independent Music in Whitesburg, Ky.
“One of the misconceptions people have is they look for the quick hit. They think they’re going to be a success overnight. That’s a very rare thing to have happen,” she said. “The normal pattern is you put one release out and start to make headway with reviewers and gradually build on that with each new release.”
Brian Harris, Midwest regional promotion manager for Priority Records in Chicago, said he runs into a lot of people eager to jump into the industry but with little knowledge of how the business works.
“They have no idea what it takes to make a record a hit,” said Harris. But he added, “It’s a whole lot easier to break through in Chicago than a lot of places across the country.”
That’s because of easier access to a loose network of radio, retailing outlets and industry executives that can help artists generate the needed buzz to turn the head of decision-makers at major labels. Company street teams of promoters often report back to their bosses about what they’ve heard.
“Start in your neighborhood and sell your records,” said Master P. “Once you start making a buzz, they’ll come looking for you. If you can’t sell records at home, you can’t sell them nowhere.”
Industry insiders back up that advice with these tips for getting started:
– Get experience in the business by working at a large record chain or interning at a radio station, record label or distribution company. Several large record companies have Chicago offices. Human resource departments at various firms can give you information about job opportunities.
– Plan to have about $2,500 to start a record company.
– Hire ambitious people you trust, even if they have little knowledge of the industry. “The business is a hustle,” said Master P.
– Negotiate for lower prices with recording studios. Try to get off-hours, between midnight and 6 a.m., when demand is lower.
– If you can’t afford to manufacture CDs now, put your recordings on cassettes. Use the profits from the cassette sales to press CDs.
– Expect to give away about 10 percent of your recordings for promotions.
– Give stores good deals so they’ll want to push your record. If the store owner pays $6.50 for most independent releases, you might want to offer yours for $5 or $4.50.
– Get a bar code from the state to keep track of your sales.
– Make noise locally. Know the players in the market. You can reach Brian Harris of Priority Records at 708-488-0032.
– WGCI-FM’s Bad Boyz–Mike Love and The Diz–showcase local talent on their daily Home Jam spots. Submitted tapes should be high bias and sent to Bad Boyz, WGCI, 332 S. Michigan Ave., Suite 600, Chicago, Ill. 60604. The telephone number for WGCI is 312-427-4800.
– Read various trade publications, including Billboard and Black Radio Exclusive, to know what’s going on in the industry. Also recommended: “Everything You’d Better Know About the Record Industry,” by Kashif (Brooklyn Boy Books & Records); and Diane Sword Rappaport’s “How to Make and Sell Your Own Recording” (Jerome Headlands Press.)
– Audio tapes of the Association for Independent Music seminar on running a small independent label are available for $75 a set by calling 606-633-0946 or visiting their Web site at www.afim.org.
