Signing to a record label is a dream for many artists, but it’s also a life-changing business decision. A label deal can either take your career to new heights or lock you into years of restrictions and financial setbacks if you’re not prepared. Before putting pen to paper, here are the top 10 things you need to know before you sign a major label deal.
1. Know What You’re Giving Up
Most label contracts require artists to give up ownership of their masters (the original recordings). This means the label controls how your music is used, licensed, and monetized. Before signing, make sure you understand exactly what rights you’re selling.
2. Advance Money Isn’t Free
That big advance check might look tempting, but it’s not a gift—it’s a loan. Labels recoup their investment before you see any profits. Until your sales, streams, or tours pay off the advance, you won’t receive royalties.
3. Royalty Percentages Are Often Small
Most artists under major labels earn between 10–20% of the revenue from their music sales. The label keeps the rest to cover marketing, promotion, and distribution. Be realistic about how much money you’ll actually take home.
4. 360 Deals Cover Everything
Many modern deals are 360 contracts, meaning the label takes a percentage of everything—album sales, merchandise, touring, endorsements, and even brand partnerships. Read the fine print carefully before agreeing to this.
5. Creative Control Can Be Limited
Labels often decide on singles, release dates, and sometimes even your image and sound. If artistic freedom is important to you, negotiate terms that allow you to keep control over your creative vision.
6. Contract Length Can Lock You In
Some deals last for several albums, not just years. If you sign for five albums, you could be tied to the label for a decade or more, depending on how quickly you release music.
7. Marketing and Promotion Are Key
One of the biggest advantages of a major label is access to global marketing and promotion. However, not every artist gets the same push. Ask how the label plans to market you before signing.
8. Touring Support Varies
Some labels invest heavily in touring, while others leave you to handle costs. Touring is one of the biggest revenue streams for artists, so find out if the label provides tour support or expects you to cover expenses.
9. Legal Advice Is Non-Negotiable
Never sign a deal without an entertainment lawyer reviewing the contract. Labels have teams of lawyers protecting their interests—you need someone protecting yours.
10. Independent Alternatives Exist
Major labels aren’t the only path to success. Independent labels, distribution deals, and self-releasing through platforms like DistroKid or TuneCore can give you more freedom and a higher percentage of revenue.
Final Thoughts
Signing a record deal is exciting, but it’s also a binding business partnership. The label’s goal is profit, not just your artistic vision. By understanding ownership, royalties, contract terms, and your alternatives, you’ll be in a stronger position to negotiate and protect your career.
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