The Music Industry Was Designed to Keep Artists Broke! Here's How?

**SPEAKER_1** (0:00)
If you French Montana comes out tomorrow, and he was saying what most people say when they leave the major label. There's no, the major label system, he said he never made money from major label. He said that outside of his advance, he said he sold 10 million records with that song, with Swae Lee. He said he never-

**SPEAKER_2** (0:18)
He never made money from that song?

**SPEAKER_1** (0:19)
He never made money in his career other than in advance.

**SPEAKER_3** (0:23)
I can tell you why. Why? Nobody has.
Okay, so this is a little dirty secret in the music business that we don't talk about enough. But the problem, the reason why nobody is able to make money in the music business as far as producers and writers on their points and stuff like that, is because artists always take out advances against the money coming. So yeah, you might not have got paid for Unforgettable, but because instead of waiting for the nine months for them to calculate or get your money, they came back to you and say, hey, shit's doing good. You want another deal? And you said, why not? All they did was bury the dead under that new deal and keep it there. It's like, you can be... Most major artists are in debt at major labels on purpose. That's the model that they play.

**SPEAKER_2** (1:05)
That's the design of the business.

**SPEAKER_3** (1:06)
That we keep them in debt. They're not forensically looking at the companies now. They just got an event. That is every... I want you to ask Rashad, anytime you're asking artists or executive, make this a part of your questions. Do you know anybody that ever got a royalty check?
So I have a diamond record with RCA right now, and I'm still 200,000. I think at the last royalty statement I got, I'm still 149,000 in the hole.

**SPEAKER_2** (1:29)
How?

**SPEAKER_1** (1:30)
So what diamond, what record is that?

**SPEAKER_2** (1:32)
It's extortion.

**SPEAKER_3** (1:33)
Oh, it's a record I did of my guys Rock City locked away. With Adapheesh and Adam Levine. It was a big pop record, but it's diamonds. And I'm like, we ain't never got a royalty check forever.

**SPEAKER_1** (1:41)
So you're saying...

**SPEAKER_3** (1:42)
Now watch this. Now I'm going to just say this real quick. For the first time, because we hot, I was able to negotiate a deal without debt. Basically, what's it called? Unrecoupable points. I negotiate that. We did one record last year. One record. I made it. We made, I think, we probably made about 800, 900K from that song in royalties in less than the year of it being released. I mean, and within the year of it being released. Because we got our points. Unrecoupable. You can't count it against debt. My points come to me from dollar one. Most points, most deals are, you get paid after we recoup. When do we know you recouped? How do we know you recouped?

**SPEAKER_2** (2:18)
And for the artists and for the business people, how can you even track when they recoup if you're not allowed to see the accountant?

**SPEAKER_3** (2:25)
You have to hire a forensic expert. I know one, by the way. I'm starting a company with him.

**SPEAKER_1** (2:29)
Forensic accountant?

**SPEAKER_2** (2:30)
Smart.

**SPEAKER_3** (2:31)
Yeah. You have to find someone that reads charts, that understands what's missing, and that can help you get your money. These guys found billions of dollars.

**SPEAKER_1** (2:40)
Yeah, we was talking to French Montana about that, but it's not even just the music industry. You look at book industry, you look at any type of thing. It's like anytime somebody says, the royalty thing, it's a catch-22, because it's like they always say, don't take advance money, take the royalty money. But then I got to trust you. I don't know what the royalty money actually is, you guys. So the only thing you really can trust is the advance, because that's money right here in my pocket right now, that I know, I know you give me two million dollars, that I know what that is. You saying, okay, the smart thing is, don't take no money up front, just take a 15% royalty for the perpetuity of the album. Bro, who's calculating this 15%?

**SPEAKER_3** (3:16)
But to me, that's when it becomes, you just have to have your business together, and you just have to understand it. But, dog, it's so many, I remember watching, Post Malone probably has never seen a royalty check, and he's one of the biggest streaming artists of all time. Taylor Swift probably has, but when they said Drake got half a billion, that half a billion was probably 450 million of it, was probably money that they owed him.