Spechouse Breaks Down the Do’s & Don’t’s of Record Deals
There is one goal most artists chase: signing to a record label. Famous artists such as Kanye West and Lecrae are signed to labels, so that must be the route to success, right? Well, sort of. While signing to a label is necessary to go on big tours and get advertising in Time Square, labels are still a business with their own agenda. Signing to one ultimately can make or break an artist’s career. Just ask Spechouse.
For an accurate view on labels and signing, we chopped it up with Christian rap producer Spechouse. The producer has been in the game for over 20 years and is most known for his work with FLAME, Cross Movement, and Da’ T.R.U.T.H. You could say he knows a thing or two about the music industry.
What’s a Record Label?
So what are record labels’ agenda? The simple answer is to generate income through contracts with artists. Contracts between a label and an artist generally read that a label will invest into an artists’ music, and in return, the artist will pay the label back after music releases. Labels in the past used to earn money solely from their signed artists’ music. Nowadays, labels needed to move away from that type of deal to what’s called a 360 deal.
“It used to be that a record company would be just that: a record company. They would just be responsible for the record, but then the artist can go off and do his art,” Spechouse explained. “Well now, streaming is free, [and] no one is making money off of it. So a record company’s like, ‘We have to make some other money man. We can’t just let you go off. We need a percentage of your merchandise, any deal you get, and anything associated with your name’.”
While the structure looks simple, how an artist approaches a contract offer can dictate their entire musical career. What artists oftentimes neglect, Spechouse explained, is that labels are looking out for their own best interest, not the artists’.
“When you get a record deal, [labels] are your opponent in the game,” Spechouse stated. “Most people think when they are getting a record deal it’s like a bigger family. You, your team, and your management are going to war with the label.”
Spechouse continued, “They have a monopoly on everything that is going to expose you, except social media. They are trying to get a monopoly on that, but right now social media you can figure out cool ways. Tobe Nwigwe has done an amazing job at using social media to blow himself up. What they do is they buy up everything above the glass ceiling and say, ‘You can only get to this level if you go through us’. Then they sell it back to you for a percentage. That makes them the enemy because they’re keeping you from everything that is up here, and they only let their artists up there.”
While labels have their monopoly, artists have their own monopoly as well – their self-built platform. Labels can’t exist without artists who already have popularity.
“Look at a label like an old, uninformed millionaire who needs somewhere to invest his money and he doesn’t understand the times, but he knows what you’re doing is hot,” Spechouse described.
How to Get a Deal
Now for the main goal: how to get a record deal. The reality is, artists can’t get record deals. Artists receive deals through networking and good management.
“A lot of people say, ‘so-and-so got a deal’. It’s less that as it is, ‘somebody got that person a deal’. It’s so relationship-based. Sometimes it’s discovery. For instance, when I got V. Rose her second [deal], somebody approached us and I got it, but normally it doesn’t happen like that.”
Even during contract negotiations, artists still need managers or people knowledgeable on contracts to decipher and change the contract. The reason being that labels are going to create contracts that mostly benefit them, not the artists. If a few lines are not understood and changed by the artist or their manager, they can ruin the artists’ entire career.
“After three or four albums, they aren’t the hot guy anymore,” Spechouse revealed. “They still owe the record company 10 albums. The record company has no interest anymore in putting them out, so they get what’s called ‘shelved’. They still owe the record company money, but only the record company can put out records on them.”
To not become a shelved artist, Spechouse provided some key verbiage that he thinks is a necessity for any record contract: “Record company must release an album, per contract, every 18 months.”
“That one piece of verbiage prevents the record company from ever shelving you,” Spechouse said.
To prevent record labels from taking large amounts of money for overestimating the cost of a task, a.k.a. gouging, write in monetary restrictions for each cost the label will have to spend money on.
“Make sure there’s a line item budgets for estimates of how much they would be able to spend and make sure there are caps on them so they cannot gouge your budget.”
Artists also need ways to walk away from their contracts. Labels write options into their contracts for them to drop artists. Artists need to ensure they have options to walk away also.
“When a label drops you, they just call it ‘exercising an option’. They put one album, two albums, then they have the option to either do it again or drop you. Then, the third album, they can put out more or drop you. They hold a lot of options,” Spechouse detailed. “After five albums, you need to have the option to walk away. Even if you sign a deal for 10 albums, you need to start having options to move forward after at least five.”
These tips are a good starting place, but not everything essential to record contracts. Managers are still important for understanding everything inside contracts and negotiating the best possible deal. If an artist cannot obtain a manager, however, there are ways to learn contract reading at the fingertips of any web surfer.
“The Internet was just kicking off when I started getting into this, so I didn’t have the luxury of yelling at my phone, ‘Hey Google, get me a course on understanding record contracts’. It’s as easy as that now.”
With all that said, remember this one truth: every Christian Rap artists’ career is controlled ultimately by the hand of God. Artists are a tool in His ministry. No matter how successful each artist wants to become, God will determine how each career turns out.
“God does stuff to confound the wise. Don’t be surprised if a humble dude with no talent gets on, and the most talented person does not. If you are in CHH, that is a huge thing. Just know you are playing by different rules. So even going into record deals, you got to pray about that. Some people should not have a deal and some people need to pass up on a record deal because there is something else coming. Some people need to get a manager first. [For] some people it’s the best thing.”