Making money as a recording artist

​Having a sustainable income from being a professional musician seems impossible to attain these days. But it isn’t. Most are just going about it wrong. Here’s a simple method you can try.

Understanding your fan as a customer

We have many, many clients and I generally get the same feedback – “We are not making any money from our recordings” or “The money is made in touring – not in recording” or “We are relying on performance royalties to provide for us for the future”.  I’m going to explain why all of these approaches are flawed and will never lead to a secure and financially successful life for any musician.

First, we don’t live in a world as it was in the 1970s, 80s or 90s anymore.  There are no such thing as “records” sold in stores.  Sure, you might find the odd nostalgic vintage record store in your town.  But ask yourself this – who goes there?  Maybe some audiophile with $10,000 invested in a sound system like it is 1988 again.  But they are probably not your fans.  They probably don’t go to your shows.

As I write this (September 2025) the fans are getting all their music essentially for free.  They are paying a monthly subscription fee to a service, and to them that is music.  You are probably one of hundreds of thousands of artists that are in that server somewhere – hoping to be discovered.  The fans are not interested in you, per se.  Their attention is fickle and not very long lasting.  This is the dilemma.  For an artist to survive financially, they have to build a vendor-customer relationship with a fan.  The customer loyalty will then flow to their next creation, and the one after that.

Know your endpoint

Loyal fans are out there.  The problem is finding them.  So the worst thing you could do to yourself is to put all your hopes & dreams on a massive ocean of “content” in which your art is devalued.  That is Spotify.

You will never be famous on Spotify.  Let’s face it – those artists who are dressed up at The Grammys are underwritten by big marketing agencies.  That’s what record labels have become.  They are marketing agencies with the sole goal to take their intellectual property (their copyright library and catalog) and sell it to the highest bidder.  That generally is sync licensing or some other form of broadcast. 

Musicians thought they could end-run this game by focusing on performance rights organizations (PROs) to have their back.  In the days of broadcast radio, that empowered the likes of BMI, ASCAP, SESAC, etc. to collect royalties on behalf of the copyright holders.  We trusted that they had our backs – we never knew what went on behind the curtain, but they did provide us with quarterly checks.

Let’s get real – first, no one uses checks anymore.  Second, no one listens to radio in any meaningful way anymore.  The Internet has become the protocol of communication of everything.  The device you have that connects to the Internet is your way of receiving sound.  If you are particular about how good things sound, you may supplement your phone with some nice headphones or earbuds.  Maybe you connect your phone to your car and Bluetooth it to your sound system in the car.  But audio quality is not there.

In order for the big data centers to get that audio into your ears, they have to compress it.  They want the smallest amount of data size possible so that they can push out more and more without having to pay or invest in more bandwidth.  The wizards who found a way to compress audio to MP3 format did so at the expense of the entire record industry.  A CD with its 44.1khz, 16bit stereo audio went the way of the dinosaur in favor of low grade MP3 files.  It seems that quantity won over quality.

But now quantity has become the meaningless quest of more, more, more.  It isn’t that you have something you care about as a collection.  It is that the price of a 24TB hard drive is half what it used to be, so you can fit more “stuff” on it.  Or that your ISP is offering you 1Gb/s Fiber Optic connections compared to the 100mb/s you used to get years ago.  More, more, more.

This is the musician’s customer.

The endpoint therefore is being able to have it all with convenience.  You don’t want to wade through the petabytes of data to find something that will move you.  You want the computer to do that for you.  By classifying each song as “content”, the data center can use the metadata and other listener’s preferences to profile it, and then profile you, and find matches.  We call that playlisting.

You rely on playlists to find you that new band or artist, and without it this whole hoarding of content thing is destroyed.  Therefore you need a software application on your device of choice that can play the music, but can integrate with the backend server platform to do all the heavy lifting for you by way of playlisting, suggesting “You might also like…” and pretending to build a relationship with a community of listeners.  Truth is that you have relationship with a database and some functional code on a server, that retrieves bytes of data and pushes it to your by way of some Internet connection.

This is the endpoint that the musician has to understand.

The income from recording

In 2025, on a planet with 8.2 billion people on it, you might be surprised to know that 68% of them have access to the Internet.  They could be your fans.  They could be your loyal following.  So it is natural that artists want to reach them all.

Reality check – you won’t.  Most don’t speak your native language and don’t like what you are doing.  That’s ok.  They don’t have to.  What you want to reach are those that do like what you do, and are willing to pay you money to enjoy it.

We seem to think that back in the days when record labels actually made CDs, that everyone made money.  They didn’t.  Only a very small few that received income from labels did, and most of them hired an army of lawyers to keep the labels honest.  You probably know all the stories of how artist X was screwed over by their label, or their management, or their publishing.  They were one in 10,000 that actually had a contract of some form put in front of them to sign that had some money referenced on the pages.  Most never got that.

Income was made by dealing with smelly club owners who hoped that you would bring in enough punters and they’d sell a lot of alcohol.  If you did that, you might be invited back to play again.  If you didn’t, you were cast aside to go and look for another club to play in.  That hasn’t changed.  In fact it has become the primary source of revenue for most musicians.  In order for the club owner to sell more beer, the musicians had to target their customer – the audience and play what they wanted to hear, rather than what the musicians wanted to create.  This has led to a world of regurgitation of the “oldies” and cover bands.  Clubs are basically Wedding Singer bands who play the standards.

That’s exactly the place I personally prefer to avoid.  And so for someone that loves to hear new and interesting artists, I will never go to those places to hear them.

The other issue is the basic rule of economics – you won’t get rich if you don’t “scale”.  If you have to exert energy every night to play in front of an audience, you are no different to the bards of medieval times.  They traveled from village to village to play to the new audience, but there is one of them and one night per day that they can play.  The costs of transport, accommodation, instrument lugging, assistants, etc. has to be born by the artist first and after those costs are paid, what they make is their income.  Let’s remember this – It is not what you earn…. It is what you keep.  You have to pay for all the costs first, and that means you find yourself on some never ending treadmill of touring in order to just survive.  Most can’t hack this over a long time.  And they have nothing substantive to show for this level of toil either.  Maybe the odd show recorded on some smart phone, or if you had a sound engineer that could record what was played, but it is generally lost forever to memories that will fade and an audience that will quickly move onto the next thing.

This is not sustainable.  You must record and get your recordings to the masses. That’s the only way you have any hope of making a decent living in this business.

What about songwriter royalties?

The old days allowed those that wrote the songs to make some money.  If you were lucky enough to be a participant in that world, you may still have payments rolling in from PROs now.  But that’s because the back catalog of what was created back then is worth a lot to record labels that don’t make records anymore. 

The problem is that for a new writer, they don’t have that to work with.  I speak with so many artists that are so protective of their copyrights to their music, but in fact that is like being protective of air.  Sure, we need it and we value it, but it is everywhere and good luck trying to sequester it.  It is also highly debatable if the creation of something actually was original.  We hear things in our world and we mentally react to those things, and they take form in new songs, etc.   But everything is based on something that was there before it.  The chance that you use synthetic instruments in your products means there is a 75% chance you are using a sample of an instrument that someone will claim to be theirs and only theirs in the future and try and bring down your world with some frivolous lawsuit.

And then there is AI – the automated means of doing the same thing.  You put your music out on some platform, and some bot is learning from it, trying to imitate you and probably doing a better job at the end product than your budget can afford with recording studios.

The days of making a living from PRO royalties are done for the newer artists.  So planning some return on investment model with that is a road to failure and frustration.

Avoid Spotify

 For many, their goal is to release on Spotify and quickly.  But this won’t work either.  First, Spotify pay artists for their work based on a pooling of artists, and then sharing a small amount to a large audience.  Some think they can game the system.  There are many services that will hack the Spotify algorithms for you by creating artificial listenership of your music.  But if the AI of Spotify detects some unusual spike in listeners, you can get blacklisted very quickly.

This gets worse too.  Because everyone relies on playlists and suggested algorithms to be heard, if you appear on a playlist that one other artist is trying to game the system, chances are the entire playlist will be blacklisted and your tracks removed from Spotify.  Spotify has no real security either – there is no two factor authentication to connect and anyone can upload anything.  That means others can pretend to be you, or can poison your catalog of art on Spotify by uploading and stating that they are you, or that they collaborated with you, and you have no idea who they are.  But if they have artificial listeners, then you lose.  They take you down and you have little recourse.

This is worsened by the fact that distribution services like Distrokid, CD Baby, etc. sell a product that is supposed to make this easier for you, but it also makes it easier for the bad actors too.  Again, they don’t secure their services like a bank account.  There is no security tokens on most of them, and no Google Authentication. 

The final nail in the coffin of Spotify is the measly amount they pay.  At $0.003 per stream (and that’s on a good day) even a popular artist can’t pay the rent with this.  So what do they do?  They get back in the tour bus and keep touring.  They are more willing to deal with smelly club owners than some faceless data center that won’t return their calls, or answer their emails.

The only attraction to Spotify is that this is where the audience is.  But that’s a fallacy.  The audiences there don’t care about artists.  They pay their $12.95 per month for the all you can eat buffet of “content”.  They don’t care about any individual artist.

The answer

It is better to have 5% of something than 100% of nothing.  You don’t need to be huge with the 68% of the 8.2 billion people on this planet with an Internet connection.  You likely won’t, and the costs and frustration to do it is a myth.  I’ve seen individual artists spending over $100,000 on an album to try and do this and it never works out.

The key here is to think more like a small business than think you are some big You Inc. corporation.  You don’t have the investors to be that, so don’t try.  Start small and create quality.  That’s how small restaurants do it.  That’s how the craftsmen and women do it.  Find a way to be sustainable.  Keep your costs low, but invest in things that actually will make you money.

Small businesses make their money at small markets.  Like Farmers Markets or trade shows.  They look for a marketplace that won’t take all their profits, but has an audience of customers that are built in. And they build a mailing list of past customers that might want to visit them when they appear at the next market.  They respect the customer by not attempting to spam them, but they are actively out there prodding the customer to be on their radar.

They also do what they can to bring the customer back to them.  That means they have invested more in having a great website or Instagram profile.  They work social media strategically – they don’t use it to spout their individual opinions that would alienate their customer base.  Businesses that have done that generally go bankrupt.

The key here is to know the endpoint.  You don’t go through all of this effort if your endpoint is Spotify.  That won’t end well.  And you also don’t want your endpoint to be your next show at Club X because you can’t scale that.  Ideally you would have the customer go to your website and pay you money to get your music.  But you can’t stop them copying it, and you probably don’t need the added expense of printing CDs and dealing with fulfilment services to get them to the customer.  The customer wants the product immediately, and waiting a week for a CD to arrive isn’t going to cut it.  And that is assuming that all of your customers have CD players – fun fact:  They don’t.

Remember the endpoint.  They have a smartphone and some headphones.  So you have to produce a digital product that can get to them.  But you don’t want it devalued.

There is a way (drum roll please…).

Bandcamp

This service has been around for decades, and has some excellent applications for smartphones, a great web browsing experience, etc.  Even a nice Apple MacOS client that I’m listening to right now as I write this.  It’s in the App Store.  It’s on Google play.  It costs nothing.  There is no monthly subscription fee here.

But for the artist, it is a marketplace not unlike the Farmers Market experience.  There you can sell digital downloads of your work.  You can use it to market to your customers automatically.  When you release a new album, they will notify your customers.  There is a lot of “drive though traffic” too.  Bandcamp will suggest your music to others that actually have money in their pocket to buy it.  You can use it to sell physical media like CDs or Vinyl if you are so inclined.  And they only take about 20% of the total revenue for the service.

The good news is that there is a paywall.  You can release samples of your music for free, but have the customer pay for the entire album.  The transaction experience for the customer is frictionless.  A simple credit card or PayPal purchase experience.  Something they are all used to, and you get your share of the sale shortly afterwards.  You can sell merch there too, if you want.

The other great news is that all the hard work that we in the recording business go through to create the best sounding version of you in the studio can be downloaded.  FLAC, AIFF, WAV, etc. are all supported.  When you download the album you bought, you choose the format you want it in.  For those of us with money invested into nice sound systems, this works.  And you know that your listeners will experience you in the quality that you hoped they would.  Not some disappointing compressed sound that isn’t the best version of you out there.

Sure, there are always those that will find some flaw with Bandcamp.  But I would ask the old Dr. Phil question here, “How’s the alternative working out for ya?”

Unless you are your own record label pressing CDs, and you have a customer base that still want them, good luck.  I’ve not met anyone like that.  Digital is the only way music is communicated now.  That’s ok – just make sure you have a paywall up so that your hard work isn’t devalued and that you build that loyal customer base who will buy what you have done, and also what you will do in the future.

If you give up, no one wins.  If you think that being a musician is about playing in the clubs 300+ nights a year, you will burn out.  If you think that you will become magically rich because of some songwriter credits or PRO payments, this ain’t 1985 anymore, Dorothy.