How to Set-Up a Music Publishing Company

music publishing

If you are a songwriter, a singer, a musician or a producer and want to get into the music business, then you can start by setting up a music publishing company. Starting a music publishing company is actually easy and anyone with zero knowledge of music can do it. But, what is difficult and what requires skill is compiling and selling music. The digital world and the television industry have paved way for many talents to come forward and establish their career, unlike yesteryears when the competition was not as hard.

So, if you want to ace in the business, you need to do it right. In this article, we will walk you through the steps required to start a music publishing company. Note that certain rules and parameters may change based on the country and state you live. This general blog post will help you set up a foundation for your company.

Know More about Music Publishing

Music publishers come from a variety of genres, including pop, classical, music production, library, or print. You can start by combining different guises, specializations, and variations. Understanding your strengths is very important in this media world. The competition is tough and you should know how you could mix your passion and trending genres together to build a career.

Coming back to music publishing, you have to understand that singing and recording a song are two complete different things. However, music contracts revolve around these two terms. They are professionally referred to as sound recording and composition.

Property Rights in Music World

These two terms are intellectual properties and like any other intellectual property (such as books, paintings, movies), they come with rights. These rights are usually known as Copy Rights. For instance, the rights ‘Back Street Boys’ have for their songs and compositions is called Copyrights. In here, the owner of the song, such as the BBB, reserves the right to reproduce or make copies of his song and receives the right to grant permission to others to make copies and reproduce. A person can get permission by obtaining a license from the songwriter or from the music publishing company associated with the songwriter.

Song Writers and Ownerships

Although songwriters are true owners of the song, they do not get rights to their songs. There are a lot of behind the scenes work that songwriters usually have to do, such as issuing licenses for the song usage, accounting, royalties, and so many other administrative works. This work can be complicated and therefore, most songwriters handover the work to established music publishing companies. They get the right to act on behalf of you in all business undertakings. In such a case, the royalties will be split 50:50.

Royalties are sales percentage of music products, including both physical and digital recordings.

Music publishers make money in the form of royalties when their owned songs are sold, aired on radio, broadcasted on television, or used in movies, video games, and other shows.

Sometimes, the songwriter sells the song to music publishing company, making them the rightful owner of the song.

Now we are sure that you have an idea from where you are coming from. Let’s move ahead to the steps and formalities required.

Steps to Start a Music Publishing Company

Affiliate Music Company with Performance Rights Organization

This should be your primary step if you are planning to start your music publishing company. PRO (Performance Rights Organization) are societies that collect royalties on behalf of companies, people, or entities that use your music. You will get the royalty if your music is used to earn income and generate money.

You may wonder why it is so important to affiliate with a PRO. Imagine you create a company with its name printed on music, registered, copyrighted and released under a publisher’s name only to find out you cannot collect royalties because your name is already taken. So, two things you need to do:

  1. Come up with a unique name
  2. Affiliate with PRO so that it guides you with your royalties

Step 1: Choose a Name

Although this should be your step 1, we thought telling about PRO was a priority. Before you choose your name, you have to make sure it is not someone else’s. Start by thinking of 15 – 20 unique names. Mix two-three words; include street names, fruits or any other funky name. Get creative as much as possible. Now narrow your list to three or four names. Next, go to Google search, enter your chosen name and ‘+ publishing’ to see if there’s a company with a similar name in your country.

Example: ‘Saregamapa + publishing’

Once you have found your top three unique names, you submit them, along with your PRO application, in order of preference, to the preferred society. You will need to register your company name as publisher in order to start a music publishing company.

Step 2: Establish Your Business as a Legal Entity

Obtain a business license by contacting your local and state authorities. Although there is no special licensing required for starting a music publishing company, it is always a good idea to follow the laws and do what is required. You can establish your company as a Sole Proprietorship, Limited Liability Corporation, Limited Liability Partnership or S-Corp.

Step 3: Performing Rights Organizations

You have to pay a modest one-time fee to be affiliated with one of the PROs. There are three PROs, namely, ASCAP (American Society of Composers, Authors, and Publishers), SESAC (Society of European State Authors and Composers) and BMI (Broadcast Music, Inc.). You will need a valid social security and Business Identification Number from IRS to become eligible for a membership application.

Step 4: Set-up Your Office

You need an office to conduct your business. You would require a dedicated telephone line, internet connection, bank account and mailing address for your office. Even if you are planning to set a home office, it is better that you don’t mix your personal transactions and business transactions.

You will have to obtain an EIN number in order to open a business bank account. Don’t forget to print a few hundred business cards, brochures and pamphlets for initial marketing and advertising.

Once this is done, you will need to prepare a standard contract for associating with music artists, bands, composers, licensees, sellers, buyers, and singers. Hire an entertainment lawyer for this purpose. Your standard contract should be full proof, professional, to-the-point and all-inclusive.

Step 5: Register for Copyright

Since now you have a fully-functional Music Publishing Company taking shape, you will have to think of protecting the interest of music you will work with and run the company ethically.

Therefore, your next step ought to be registering copyright to the music.

You will have to register the copyright under the registered name of your music publishing company. If the copyright to the music you want to publish is already copyrighted in your name or someone else’s name, you will have to submit a copyright transfer application over to your business name.

For more details, get in touch with your local copyright office.

Step 6: Register Your Songs with PRO

If you haven’t done this already during affiliation, you should do it as soon as you have your music. You must register all of your music with the PRO by simply filling out forms required for submitting your songs.

When you register the songs as a publisher, you rightfully take the publisher’s credit and ethically assign the songwriter credit to the artist you represent.

However, if you are a songwriter or composer yourself (and starting a publishing company), register your music as a songwriter instead of a publisher.

Step 7: Start Marketing, Branding and Ultimately, Publishing

There are different ways you can market your music publishing company. The rise of social media has introduced us to many creative platforms for marketing, branding, and promoting.

However, here are a few steps you can follow:

  • Get in touch with the music artists and copyright owners you are interested in and pitch your proposal to them. Make sure you present your services in a profitable manner so that they are attracted to you instantly. You can find artists, singers, and copyright holders on the PRO website, on social media, and other performance venues and events.
  • Develop a mutual agreement between you and the artist or owner. The agreement should state that you would sell their music for a fee or a certain percentage from the profit. The more you get creative in your sharing terms, the more clients you will acquire.
  • If the artist or owner is already associated with another publishing company, you may have to sub-contract with the other publisher and deal for a smaller percentage.
  • For marketing your services, you will have to prepare a music catalog by listing the songs and music products you have contracted to sell.
  • Make sure the songs you select are relevant to the current trend and it should be appreciated and embraced by a larger demography.
  • Contact with retailers, musicians, filmmakers, video game makers, radio stations and other buyers of music. You should pitch your sales with a handy standard contract that outlines the benefits of associating with you.
  • Once you have a deal, the first thing you should do is customize a contract specific to your current client’s needs, requirement, and agreement. Do not forget to mention the percentage of fee you will get for the use of music you are authorized to publish.

Many types of music publishing contracts require negotiation skills, agreement drafting skills and communication skills. So, you will have to refine those skills as well. Having an entertainment lawyer will protect you, your products, your associated artists, and the buyers from potential lawsuits and bad deals.

Make sure you have planned your finances way ahead of time and have financial security for at least 6 months to 1 year after you start your company. Building a successful music publishing company takes time and effort, and of course financial investment and if you do not have another income backing you up, you may land into serious financial hardship and probably bankruptcy too.

All the best for your new venture! Leave your queries and discussions in comments, we shall get back to you as earliest.