As an independent musician, you are your own business, which comes with a lot of red tape. You started making music because you love it, but now you want to make it your living.

Doing business means understanding copyright laws, royalties, and contracts to protect your music and maximize income from streaming, licensing, and merchandise. You should know some basic laws and practices before you grow into a sustainable music career.

Understand Copyright Law and Music Rights

Copyright law protects and allows you to make money from your music. As soon as you create and fix your original music in a tangible form (like recording or writing it down), you automatically own the copyright. That means you're legally recognized as the creator and have exclusive rights to reproduce, perform, remix and sell your music. If someone else uses your music without permission, you can send a takedown notice (like a DMCA), demand payment or sue for damages if necessary. 

Know how music royalties work and how to monetize your music by streaming, sync licensing, selling beats, etc.. First, register your music with a performing rights organization (PRO) like ASCAP, BMI, or SESAC to ensure you get paid for plays and performances. 

Before collaborating with other artists or producers, learn the basics of contracts and agreements to protect both parties. Examples of key contracts are producer agreements, work-for-hire, band agreements, and manager contracts. 

Manage Your Finances

There are different ways you can profit from music and earn a sustainable income. Sell your music on platforms like Bandcamp or streaming services like Spotify. Payouts are small per play, but more plays bring higher revenue. Aggregators like DistroKid, CD Baby and TuneCore also collect and distribute royalties.

Playing gigs or live streaming performances can generate income and boost exposure. As your fanbase grows, consider making and selling merchandise like T-shirts, hoodies, and posters. You can sell these online and at your shows.

As you start earning money, keep track of your finances. Consider setting up an LLC to protect your personal assets. It’s also recommended you create split sheets for every song you work on. 

Split sheets keep track of collaborators’ compensation for work. They detail each collaborator’s percentage of ownership in a record (on the publishing and master side). All collaborators come to terms on percentages of ownership, then sign off on the split sheet to certify the agreement. 

Split sheets are helpful in negotiating deals, licensing music, and offering legal protection. Doing clean and transparent business is one of the easiest ways to rise up in the music industry and gain respect from peers. If you’re not used to talking with collaborators about what everyone’s compensation should be, this is your sign to start having those conversations.

Build a Team

This newsletter is just the tip of the iceberg; the business side of music can get complicated. A lot of work you can do yourself, but hiring a small team can be well worth it. After all, legal risks should not be taken lightly. 

What It Means to Hire a Music Publisher

A music publisher can handle the business side of things, so you can focus more on creating. You don’t have to sign with a publisher–you can self-publish and keep 100% of the rights–if you want to do all the work yourself. But when you’re getting sync placements, collaborating or building a large catalog, a good publisher can maximize your income, save you some time and present new opportunities. 

Publishers know the difference between master rights and publishing rights, which is an important distinction. Also consider performance rights vs. mechanical royalties, as mechanical royalties aren’t covered from physical/digital sales and streams. Publishers can also tell you how The MLC (Mechanical Licensing Collective) and SoundExchange compare and why you should care about them.

Why Hire an Entertainment Lawyer?

Having an entertainment lawyer may be smart. These lawyers specialize in the music industry and know how to navigate contracts, negotiate deals, register copyrights, and protect your rights. 

An entertainment lawyer ensures you understand the fine print and avoid bad deals. They can also help resolve disputes and advise you on long-term career decisions.

When to Get a Booking Agent

A booking agent can help you hash out touring logistics. While some musicians manage their own bookings, a booking agent can negotiate contracts, secure venues, and handle the details of scheduling. They also have established industry connections, which can open doors to better opportunities and ensure that your tour runs smoothly—from routing to pricing. 

Consider a Financial Advisor

Some musicians hire a financial advisor, especially as their career (and income) starts to grow. Plus, music income isn't always consistent. Gigs, royalties, sync deals and merch sales will ebb and flow. A financial advisor can help create a realistic budget, track expenses and forecast earnings. 

You started making music because you love it. Now, you’re your own business. There are different roads to profit from music, it’s up to you what it looks like. Once you know how to handle any red tape, you can climb the ladder to a sustainable music career with higher income.