By, Wendy Day from Rap Coalition
One of the main things we lack in urban music is structure for our companies. Sometimes it seems that those who have the money have mediocre music, and those without real funding have the best shit, but whether this is true or not, one thing everyone seems to be missing is the proper structure to run a company like a real company.
It starts with the basics of doing business. Have a mailing address, a phone number that actually gets answered and doesn’t get shut off due to nonpayment issues. If someone calls you, make sure you return the call in a timely fashion (more than two days is unacceptable—this is one of my biggest flaws, so I understand how difficult it is to be on point when you get upwards of 200 calls a day). If you can’t call everybody back, have someone on your staff help you (even an intern returning calls is better than not calling people back). If you attend an industry function or if you have meetings, have a business card with all of your information on it (name, position, company name, address, phone number, website address, email address, etc). A business card is how people will remember you, so make it stand out and make it look good.
If you want to run a business, then you have to run the business. When you owe someone money, pay them. If a bill is due on the 5th of the month, pay it before the 5th so it arrives at its destination before the due date. This seems to be the hardest thing to accomplish in this industry—getting paid when owed money. Don’t pay by a check that might bounce, either pay by certified check or wire transfer. If you want to be taken seriously in this industry, you have to be serious. If you are a deadbeat, word spreads very quickly. I consistently call out people publicly who have owed me money. If I don’t do business with you, chances are no one else will either; what happens to your company when no one will work with you?
Make sure your company is set up properly as a corporation, so you can’t get sued personally for something that could go wrong. If something can go wrong, it usually does. And while you can’t plan for every mishap, you can protect yourself from the ones that are big problems. Setting up a corporation with the proper business licenses to operate in your city or town, and paying the proper taxes on your income (city, state, and federal) are all part of operating a legitimate business. If you don’t understand what you need to do, ask an accountant or the local office of the Small Business Administration (www.sba.org). Your corporation must be kept in good standing every year with your state. Find out how to do that, and do it.
Set up a bank account in your company name and pay all of your company bills from this account. Be careful not to pay any personal things out of this account because business and personal funds should never co-mingle. Secure agreements in writing with all artists, featured side artists, producers, consultants, and contractors that you hire to help your project or company. Do NOT use standardized forms if you can help it because every agreement is unique. A contract is an agreement between two people and they are rarely uniform agreements. A contract bought off the internet for a few hundred dollars may save you some money now, but it will cost you more down the road when a disgruntled artist wants to break it (and they will, and I will help them for free).
If you have a song that may go to radio soon, set up your writer’s share and publishing company with one of the performance rights societies (www.ascap.com, www.bmi.com, or www.sesac.com), as well as the one for digital music (www.soundexchange.com). If you are putting out your own CD, you will need to get your own bar code and possibly trademark your artists’ names and label’s name. Nothing would suck more than to have to change your artist’s name or company name down the road (after you’ve spent all that money) because someone else across the country used it first or registered the trademark. Pay a little bit now to do it right, or pay a lot more later to fix a problem—it’s your call.
Most importantly, do what you say you are going to do. If you tell someone you are going to do something, do it. If you say you’ll do it by a certain time, then that’s your deadline—do it before then.
Have a space dedicated to work. It doesn’t have to be a fancy office, it just has to be a space where you can get work done and have some helpers come and work. It takes a team of people to make a project succeed, no one person can do it all alone. Even if you start with interns instead of employees, you at least have help doing the work. Keep your work space as work oriented as possible. Smoking blunts, playing video games, or macking ho’s has no place in an office environment, so keep it out. Your work space is for work. If you set the tone, others will follow. All of the most successful companies have discipline and rules of conduct. The most successful ones actually follow them rigidly.
Make sure everyone knows what is expected of them in your office environment. Each job should have a written job description so each person knows their role. And each person should play their role. If there is a written description of what’s expected of each person, there is also a way to measure their success, or failure, in that position. Get rid of the folks who aren’t successful at what they do, and reward the ones who are. Having your own company entails more than just having a business card—it actually means you have to work and succeed at it. Don’t floss unless you’ve really earned it—unless you enjoy being perceived as a clown.
Learn the things that you don’t know but need to know to succeed. Ask others who have accomplished similar things before you, pick up a book, or hire an expereinced consultant to guide you if you can afford it. Make sure that you are learning as you go, and don’t be afraid to ask over and over until it’s crystal clear to you. Learn who the key players in the industry are and study the moves they’ve made and are making. Learn why they have value to the industry. If you study their successes and their mistakes, you won’t be doomed to repeat them.
Set the tone in your office that you are approachable, open minded, and eager to problem solve, and your staff will learn to trust you by telling you the truth. Without knowing what’s real and true, you can’t run an effective organization. Better to know what you are dealing with so you can react appropriately, than to be led down the wrong road costing you tons of money.
Running a company in the music business is NOTHING like running an organization on the streets or like moving weight. This is a completely different beast, even though it often gets compared to “the game.” It takes tremendous hustle, relationships and connections, and incredible preparation. Those without tenacity and staying power will be weeded out quickly. I’ve been doing this for 15 years, and can count on my fingers and toes the amount of people still in the business from when I started. It is a difficult industry that chews people up and spits them out. Even though there are an inordinate amount of snakes in this industry, the good thing is that people show their true colors very quickly, so it doesn’t take long to tell who the scumbags are. Ask around—most people who’ve gotten burned are happy to share their experiences with anyone who will listen. Just remember there are two sides to every story, so ask around to a lot of different people to get the best understanding of who’s who.
Check the references of everyone you do business with. Just because someone tells you they can accomplish something, doesn’t mean they can or ever have before. This is an industry that attracts idiots and people who claim to be something they are not. Don’t get caught out there by one because they kicked good game and sounded like they knew what they were talking about.
If we had a little more business going on in the music BUSINESS, everyone would make a lot more money. Having your company properly structured and organized is key to achieving success and keeping the success flowing. When the money does finally start rolling in, it comes very fast. And when you get busy, finding the time to go back and fix all of the problems, is impossible. So do it right the first time!
