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The Income Streams You're Missing (And How to Fix It Before You Blow Up)

One of the things I've done for work over the years is take on an artist who's had some success. They have a few songs with a few million plays and still have a few hundred thousand listeners, so they continue to generate revenue. However, they have a feeling that they didn't quite do it right from the start, and perhaps they're missing out on some royalties and income.

I go in and look around to make sure the income streams are coming from all the different places you can make money from music. But inevitably, as I do this, there comes a moment of extreme angst. Luckily, it's not towards me, since these guns aren't exactly firing off many shots... What they're mad about is that they see all the royalties they could have received if they just set up properly from day one. Unfortunately, they didn't take a few hours to read a book or something, or they trusted a manager who didn't have their mind on their money and their money on their mind.

Musicians are already compensated far less than they should be. It's super important that, whether you started your project last week, last year, or 10 years ago, you get everything in order so every dollar gets collected and you don't miss out on the money you're entitled to. This is only a few hours of work, and if your songs start blowing up, it could ensure that you don't have to be angry in the future about all the money you let go to someone else instead of you.

I'll walk you through the income streams you should have set up from day one for your music.

SoundExchange (The One Most People Miss)

The first one most people miss, because it's a little intimidating, is SoundExchange, which is a service that collects royalties for performers of songs, meaning the people who played on them.

Here's the best part: you pay no money for this. Each time you put out a song, you enter the percentage of royalties due to each performer, and they'll send you money if your song is being consumed on the internet or other digital means. This is the most common income stream missed.

I have great news. If you have missed this and you have songs with streams on them already, they've been collecting those royalties for you and have them sitting there waiting to pay you. If you register your songs with them for free, there may be money already sitting there as long as the streams aren't more than a few years old.

Enjoying this? Forward it to a music friend you’d like to be closer to and start a discussion!.

Merch Store (Easy Money You're Leaving on the Table)

The next one is one of the easiest and overlooked ways to make money: setting up a merch store. My last video gave you tons of tips on how to run a successful merch line and make sales, but I really want to instill this in you.

With print-on-demand, you need to put no money down to get merch up for sale, or a small monthly fee if you want to use Shopify and get your merch for sale on Spotify and YouTube with some minimal setup time. Getting a few designs together and an hour or two of setup can enable another stream of income. When people connect with your music, they want to support you and show off to others that they like your music, and there's no easier way.

Use the Right Distributor (Stop Giving Away 10%)

Let me remind you of something that so many people overlook. We all know that you need to go through a site like TuneCore or DistroKid to get your music online, but so many of those sites or the big distributors take 10% of your royalties at a minimum, sometimes. Whereas TuneCore and DistroKid take no percentage. They just charge an annual fee.

While you need to pay them each year to put your music on those stores, it's well worth it to have them not take a percentage if you're getting streams. Let's remember: a million streams of your song is around $10,000 in royalties. If you're giving 10% of that to a service because you were lazy and didn't do your research, you're $1,000 less rich for every million streams because you signed a shitty deal.

If you own all the rights to your music and you're on a distributor that takes a percentage, you could always switch to one that doesn't without losing plays, playlist placements, or royalties. Your songs will be down for a few days if you switch—maybe three—but they go right back up with all the same plays, and you're making more money.

But be wary. We recently discussed how distributors like DistroKid have terrible customer service, so when shit hits the fan, good luck getting someone to help solve it. The distributors who take percentages of your royalties can oftentimes be more sought after since they might have better customer service, which is a huge thing. You don't want someone posting songs onto your profile randomly or messy situations like that that can't get resolved. So while saving that 10% is important, make sure you're not trading money for peace of mind if you're growing and things could go wrong.

Bandcamp (Where Real Fans Support You)

One of the other things musicians forget is that the biggest music fans use Bandcamp to support artists. Having your music up there with a name-your-own-price model where they can tip you, could be an amazing way to enable people to fund you.

While you should suggest a normal price for your music, allowing the fans to name how much they would compensate you really can help get tips from the more financially well-endowed. I routinely tip young artists. I've left hundreds of dollars on there or through Spotify through their tip jar, since I think musicians are poorly funded and want to say thanks for their art when I really enjoy it.

Even if you are a small artist, if you're playing live, having some music to sell—cassettes, even though no one listens to them—can help you get funds if you're playing live, and that's a regular part of what you do. If it's a real regular part of what you do and you're getting hundreds of thousands of streams, all the more reason that in most genres, you should have vinyl because most people don't have a record player that works, but they'll still buy it to support you.

Publishing Royalties (Register Your Songs AND Your Sets)

Next, we have to register with a publisher like BMI, ASCAP, or SESAC. These are nonprofits that collect your publishing royalties for things like radio airplay or public performances in bars or even at your shows.

All you have to do is pay a fee to sign up, and they will do the rest. As long as you register each song you release and upload your live performance sets, you'll make money. Truly, forgetting to upload your set is one of the biggest ball drops I see musicians make regularly. So don't forget that.

Even if the show is sparsely attended, it can help because oftentimes they do it by the average number of people who attend that club.