How do I form a music publishing company?
Music publishers come in a variety of different guises: Pop, classical, production (or library) music and print, with a range of combinations, specialisations and variations in between. You’ll know where your experience and, just as important, your passion lie. Play to your strengths.
Anyone starting a business should get hold of a copy of the excellent Business Link “No-Nonsense Guide to Starting a Business”, available from www.businesslink.gov.uk. The Guide is a good aide memoire and introduction to all aspects of setting up in business – forming a business, tax and NI, VAT, protecting your IP, employment, trading regulations and data protection.
One of the first decisions will be what structure the business will take: sole trader; partnership; limited company? As you will be acquiring intellectual property (copyright in this case but also comprising patents and trade marks) it may be appropriate from the word go to vest these rights in a limited company. This affords protection from infringement claims and gives you flexibility to deal with such assets separately, but there are costs and government regulations to consider.
Acquiring copyrights and building a stable of songwriters will take money. Other costs include legal fees, demo costs, promotion and office expenses (even if your office is a virtual one). If you’re starting out from scratch and don’t have the capital to acquire an existing catalogue then patience for the long game is needed, along with the money to keep a roof over your head while you’re playing it. It could well be two years from setting up before you start to see any income. Banks may be willing to lend you money, and if you go down this route it’s important to find a lender that has an understanding of the business. Even if you are not seeking external finance writing a business plan focuses the mind on your strengths and weaknesses, and the opportunities and threats of the publishing market – the so called SWOT test.
Getting started – finding and signing the talent
Well-tuned ears and a passion for music are pre-requisites. If you don’t have them, your first employee should. There will always be new talent to be found – it’s a renewable resource - but there’s no guaranteed formula for finding it. Getting out to gigs is still important, and MySpace can be a useful tool (as well as a real timewaster). Just as valuable is building up your contacts in the industry, and there are plenty of networking events to attend. The value to your business of building a good reputation within the industry cannot be overstated.
There is no standard form publishing agreement. Various types of agreement include single song assignment, exclusive agreement for future works, and sub-publishing agreement. Have a lawyer draw up your contracts, and ensure that the composer has been advised to seek independent advice. Sub-publishing arrangements will allow you to offer songwriters global representation. Choose your sub-publishers carefully and don’t tie yourself into lengthy deals – two or three years is normal. Remember that you can also act as a sub-publisher for other catalogues in your own territory.
Music is globally ubiquitous – online and offline. Collective licensing is an efficient way of ensuring that such uses are licensed and rights owners remunerated for such use. Investigate membership of both MCPS and PRS. It is crucial that you register your songs quickly and accurately. An increasingly important source of income for all varieties of publisher is synchronisation licensing. Cultivating contacts and building a reputation in this area is vital again.
For more information
The MPA runs an induction course four times a year. It is an essential introduction to the music publishing industry and covers, inter alia, the many facets of music publishing; agreements and money; the writer’s perspective; copyright & related rights; the work of the collecting societies; and the users’ perspective.