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In that sense, record labels are like VCs that also provide PR. For the amount of the investment that both labels and tech VCs make, its quite normal in our soc
by mjdwitt 15y ago
In that sense, record labels are like VCs that also provide PR. For the amount of the investment that both labels and tech VCs make, its quite normal in our society to take an equity cut rather than a flat rate. Making the analogy to VCs also relates a lot better to the odds of failure, given that labels lose money on most of the bands they sign. And similarly to founders that don't know how to negotiate for good terms on their funding, many bands are also poor negotiators.
- chc 15y agoThe labels don't really provide funding in the same way that VCs do; they essentially provide a very large payday loan. Any VC who demanded the kind of terms record labels do would be run out of the Valley. The interesting question is, is there room for a real VC industry in music? I think there might be someday, but not in the current market — the existing cartel is so horribly messed up that they'd be pleased as punch to take you down with them.