Hello and welcome to section 5 of the unsigned guide. This week I’ll be looking at ‘Management Companies. Management is an essential part of the music process which I’ll go into in more detail throughout this blog.
According to The Unsigned Guide, one of the most overlooked factors in the development of an unsigned band is management, or at least some form of representation, from a creative perspective and/or on a business level. Initially, there are 3 basic options to choose from: self-management, employing the services of a management company, or lining up a suitably interested friend with enthusiasm and a few contacts to do the job.
There is no fixed stage in your career at which a manager should be appointed, however, from the outset there will be a management role to be undertaken. You’ll need to put someone in place to take responsibility for tasks such as approaching venues and promoters to book gigs, to undertake basic marketing and press work, arrange for a good website to be built and to find you deals in terms of, for example, studio bookings or CD duplication.
They also need to take charge of presenting your demos to a professional standard to the wider industry (including managing follow-up phone calls and emails), and hopefully to begin entry-level contract negotiations on your behalf. An invaluable contact for new managers, bands and artists is the Music Manager’s Forum (MMF) who represent a network of music managers, allowing them to share experiences and information. For further details, please see their website.
A commission rate of 20% is perhaps more common than 15% nowadays, but this is obviously negotiable. The manager should not take commission on recording costs, promotional video costs, or tour support (money advanced to a band by the record company towards the cost of touring). Commission from live performances should be awarded after the costs of agents’ commission and the production costs etc. have been deducted.
Length of Contract
A one year contract with two options to extend the deal for a further year (i.e. three years in total) would seem fair, but some managers try to secure a five year term. What the Musicians’ Union recommends is the inclusion of a ‘performance clause’ which will state that if the manager hasn’t secured within one year a recording or publishing deal to the artist’s satisfaction, then the artist will be entitled to terminate the contract.
Artists or bands in a very strong position can sometimes limit a manager to specific territories so that someone else can represent in, for example, the highly important market of North America.
How comprehensive is the agreement?
If you’re already an in-demand session player, for example, you may want to try and exclude these activities from the management contract. Only ever allow the manager to sign individual live appearance contracts on the band’s behalf. All recording, publishing and merchandising contracts should be signed by you.
The manager has to be allowed to spend small amounts of money on behalf of the artist, but a figure should be agreed beforehand. Any additional expenses incurred should require your express permission. Only travelling and accommodation costs incurred by the manager while working with the band should come out of band funds. A manager should pay their own office expenses including phone costs etc.
Ideally the Musicians’ Union suggest all monies should be paid directly to the band’s accountant who would then pay the manager commission and expenses that are due. If for any reason the manager won’t agree to this, then they should present their operating accounts to the band at least four times a year (monthly would be more ideal) and large sums of money such as advances from a recording or publishing company, should be paid to you within seven days of the manager receiving them.
Right of Audit Clause
This is an essential clause that allows you to look at the manager’s books if you feel the need. It should be in any music business contract.
After the agreement is over
The position nowadays is usually that the manager should continue should be paid commission on records released or copyrights published during their term of office but not on future records or songs, even if they fall under record or publishing agreement they helped to negotiate. Such ‘after the term’ commission should decrease over a period of time and eventually end completely. This leaves you at liberty to do an uncomplicated deal with a new manager if you wish.
This is it for management companies. Stay tuned because next week I’ll be looking more into the ‘Industry Organisations’.