How Music Producers Get Paid + Finding $1M in Missing Royalties ft. Daniel Cruz

I started a company that focused on helping producers get paid for songs because I noticed it was such a big problem in the producer community. So if you go through those seven steps, you're good. You do all those things, then you're good. You only got one choice. You gotta file a song takedown. But if the song comes out and they didn't pay you for it, you have more leverage. Artists would rather talk on all in terms, which means this guy just agreed to $5,000 and he made the play, and this is his relationship, and you just made a loop. How important is that relationship to you? Are you gonna get the songs released sooner? Are you gonna get the lawyers to move faster, or are you gonna do what you can do? Which has come correct. Getting paid as a music producer is the absolute worst. It's confusing, it takes forever, and there's really no industry standards on how much you should be getting paid in the first place. On today's episode, we sat down with Daniel Cruz, a bona fide expert in the field of getting producers paid. His company, Producer Royalty, collected seven figures for its clients in 2024. The craziest part is they didn't even know they were owed this money. If only this episode existed earlier. He breaks down how every single type of royalty on the master recording side and the publishing are generated and how to make sure you're collecting every fing penny of it.

There's also priceless information about the money conversations that artists and producers have to have and when they should be having them. All that and much, much more. Let's start getting you paid right now. Let's get into it. Yeah, I came to Atlanta just to shoot podcasts for the most part. Well, you're on the best goddamn podcast in the land, Henry. We got Daniel Cruz from producer royalty on the pod. Daniel Cruz! They said it couldn't happen, Henry. They said it couldn't happen. And I said, God did. God did. Aren't you supposed to like say I look like somebody? We did that for a minute. Did you like it? Let's bring it back. Bro, I was I was talking to Alina. I'm like, bro, what are they gonna say I look like? I was like, I don't know. Now, welcome again on the One More Time podcast, Cuba Gooding Jr. Fuck, I I was you know what I was gonna tell Alina, I was gonna be like, my assistant, I was like, have your phone open to look them up and then show me off camera because I know I knew you weren't gonna tell me somebody I knew. So who do you who do you get? who do you get?

I used to get Bruno Mars. Oh, do it again. do it again, do it again. Now welcome in on the one more time podcast to Bruno Mars! Bruno Mars! Bruno Mars! God, We got Bruno, baby. I haven't done a roast in a while. I know. It's great. It kind of was nostalgic. We should bring it back. It's nice. I don't know. Anyways, no, Daniel, appreciate you coming on the podcast. Um, Daniel Cruz is the head of producer royalty. For those that aren't familiar, just like quick plug, just so we have some context as to like who you are. Word. Um, so I came into the producer community. I uh came on the legal side. So like I wanted to help artists initially, like coming into, you know, I had art friends that wanted to be artists, and I'm like, what can I do for you? Uh I'll be your manager, because that's what I knew. You know, I had a business mind kind of sort of in high school. And you and you had no qualifications No, not at all. So the go-to is nobody does it first. No, but I know. Yeah.

But managers, I also started off managing, and it was like, wait, what can I do in the music industry without any qualifications? Manager. Management. Yeah. Entirely, bro. So yeah, so it was like I had artist friends like, oh shit, your life is gonna be so lit. I was like, how can I be a part of that in high school, right? And I was like, I'm your manager. Yeah. So that's what I did. And then I got into college. I'm like, oh shit, like, you know, I always did good academically, so it was like I was doing well. They weren't because they were artists, and I'm not friends with them anymore. I was gonna say, I thought they're artists, but I was like, how many of their lives are actually lit now? Yeah, yeah, it didn't pan out. That's a touchy subject. Okay, we won't go there. Yeah, let uh so then, you know, kept going through college and I was doing well, and I I I was studying philosophy, and then I was like, yo, what do you do with philosophy degree? One thing I noticed was people got into law, so like, oh shit, uh I'll be a lawyer. And then I discovered entertainment law. I'm like, oh shit, I'm gonna do that. I'm gonna be an entertainment lawyer. And then I discovered music law, then I discovered hip hop law, then I discovered like hip-hop lawyers a lot of times focused on producers, and that's how they got their start. So I'm like, all right, bet, so I'm gonna do that.

So he went. He just kept going. Yeah, he just niched the niches. The riches are in the niches. What is it? That's it. Okay, riches are in the niches. You got it. Alright, all right, so you know, you refer to yourself as, and I guess producer royalty, the like firm in general, as the placement debt collector. Yeah, so while I was in law school, I was like, um, I was working for Adam Freeman, who's like one of the top uh producer lawyers, and like 90% of what he had me doing was with uh producers. So I was like, one day a lot of people were reaching out to him that were producers that weren't paid, and they would be like, yo, like what do I do about this situation? And and many lawyers weren't really willing to support producers in those situations because they weren't profitable enough. There were one time situations where it's like, if I work with this guy right now, I help him get paid right now. It's like it's not gonna be a long-term fruitful thing. This is a one-off thing, somebody stole it off of YouTube, you know what I mean. So one day he looked at me, he's like, you know, like helping people in these situations isn't necessarily legal, you could just do it yourself. So I was like, oh shit, like I guess you're right. So I was like, I started a company that focused on helping producers get paid for songs because I noticed it was such a big problem in the producer community getting paid while I was in law school. Now I just graduated, now I just passed a bar exam.

I'm Not a lawyer yet, but I'm gonna be a lawyer within the next couple months because uh you have to go through application process. So nice. I guess I don't understand why why were people saying it's so unprofitable? Because in my mind, if I'm a producer, my beat gets stolen. It's not the only beat I've ever I'm ever gonna make in the world that an artist might use. Like, like if he goes and gets me my money, I feel like he's like my hero at that point. Like, I'm I'm not doing anything else besides working with Daniel Cruz from producer royalty. So I don't what about it? Was like uh not worth it. For one, obviously, a lot of times they're small songs, right? So if it's like got a million streams, a song made for the artist, like maybe I don't know. Four thousand dollars. Is that the number? It was okay. All right, bet. Okay, cool. So let's say a million uh Spotify streams got four thousand dollars, and like you're gonna come in ask for how much? A thousand, two thousand dollars if you got a million streams, and it's like how much the lawyer's gonna get. Is it worth it? Is it worth spending and how much time are they gonna spend Sure. So, like a couple hundred bucks. Yeah, like if you're a lawyer that's like at a certain level, like when you're first getting started, which is what I've noticed was they started working with producers.

Why? Because they had smaller cases in a lot of cases, a lot of times, too. And it's yeah, like so. You can spend and another issue about working with lawyer uh producers is like getting paid as a producer, like we'll take many, many months. Let's talk about it. Yeah, let's talk about it. Why does that problem exist? Like, from your experience, why did it happen for you, Henry? I think there's just it's the way the industry is set up. There's just red tape and regulations and little decisions have to go through a hundred people. I think that's a big part of it, right? Yeah, it definitely depends on on the type of person that you're working with, right? So if you're working with a major label artist, the reason why is is pretty different than working with an independent artist, I would say. So uh which one do you want me to touch on first? Let's go, Major. Let's do that. Let's do major. All right, man. So with a major label artist, this is the process. So first of all, they don't decide what songs are going on the album until a week to a month before, let's say. It could be a little bit before that, but by the time they're ready to reach out to the producer and ready to clear the song, it could be a week to a month before, right? We've heard so many producers that they found out that they got a placement when the project came out.

Yeah, yeah, yeah. For sure. So that's a huge issue for sure. So it takes a long ass time to even know about that. You got the record, right? Or at least it's late. So that process starts, and then all right, so now it's time to negotiate, right? So like you the negotiation process, you know, I I broke it down into seven steps. I have like a course that breaks down the entire placement process beginning to end. Let's go through those seven steps real quick. Okay, bet. So at first high level, I mean, come on. Yeah, yeah. We got you on the one more time podcast, my friend. Let's go. I have a thing where I go so high level. People say this is uh a crit uh criticism of me. Like I go so high level that it's sometimes like incomprehensible for some people, but I'll I'll try to keep it a little bit low. So um, first step is to connect with the artist team. Make sure you start that initial conversation with people and you know who to speak with. So whether that's the artist manager, artist AR, if it's a major label artist, it's gonna be their lawyer, most likely. So you know who that is. So if somebody stole your beat, you gotta figure out who to reach out to. That's the first step, right? It's an obvious thing, but sometimes that's the thing that discourages the most people, right? Yep, yeah.

Second step. Let's assume we know nothing, Daniel. So second step is to negotiate the material terms, which is your advance, your master royalty, and your publishing on it. So you gotta go through that, right? So you know, connecting could take you a couple weeks. Maybe it start, maybe they do it right and they reach out to you right away. Negotiating, that could take you, uh it could take you a couple days up to a couple months. Who knows how long that takes? The third step is to to the agreement when the contract comes in. So once you get the contract, you actually have to negotiate the contract. The lawyers will go back and forth from the contract. That could take also again a couple days to a couple weeks. Who knows how long that takes? Then after that contract signed, then you start the payment process after that. And the payment process, again, they go net 30, net 45. That could take an indefinite amount. Net 90, yeah, they say whatever motherfucking net 90, bro. We don't stand for the net 90 on this podcast. Not on this podcast. Maybe on your podcast, but We don't. All right. So that so yeah, so that could take an indefinite uh indefinite amount of time. Who knows how long that takes?

So now, how many weeks have we gone by? Well, of course, it depends, right? If you if each of them was a week, then that could be a month. But again, they didn't start the process until a couple weeks before, maybe the week before. So, like, and then if it takes a month for each of those stages, let's say you have to sign up as a vendor with the label's payment system. That could take a month of its own if it's the first time working with the label. So then after that, you have to follow up with them, actually draft the invoice, send it to them. Maybe you made a couple errors in that invoice a lot. So, like, there's a lot of steps that go into it. And that's just because hold on, you were only on three and then you skipped a little bit. Yeah, so what's step? One, connect with the artist's team. Second, negotiate the material terms. Third, um agreement. The agreement, the actual contract. Fourth was the payment process, fourth is just payment process overall. Getting that advance. So then the last three steps I say are the royalty steps. So it's like the fifth step is to collect your sound exchange royalties, and then the sixth step would be to collect your publishing royalties. Now, of course, there's a bunch of different ways you could do that. Then the last step, if you are owed them, collect your master royalties. So if you go through those seven steps, then that's how you collect your every step, and then you're good.

You do all those things, then you're good. I'm tired from listening to the process. Bro, I broke it down, bro. It took me over a thousand hours to make this course. And like I yeah, I'd like to decide to break it down into each of those things and go in full detail. But yeah. Is it available? Uh so it's available on school right now. I'm repackaging. You're doing school? Yeah, I'm doing school, but it didn't go the like this course is so valuable that like school doesn't really uh position it in a way that's like it's one of many things that we offer, so people aren't appreciating the value of it. So I need to repackage it and like be like, yo, this is so, but when this comes out, it probably will be repackaged. The link is in the description right now. If you want to find out all the details around those seven steps to get paid as a producer, we don't have to get hormozy involved. Exactly. We're not giving him 10% of our fucking course. We're just giving one more time podcast, 20% of our course. Yeah, there we go. 20, that was weak. Come on. Come on, bro. What are we doing? 35 is where we start. That's where we start. Yep. Oh, all right, cool. So you kind of alluded to this, but let's say that to Henry's point, I'm a producer, and I find out that my song has been used without my permission, right? Are these the steps, or is there anything different about you know?

Because I think you actually made a post about this. So maybe aside from all those steps that you said, like in a more traditional format, right? Where they do notify you. I'll answer your question. I know what you're saying. Okay, sure. Like my beat's gotten stolen. What the fuck do I do? Yeah. So the emphasis on that is the first step. Connecting with the artist team, starting the process. So the first step, if if your beat gets stolen, is you have to figure out how to start the placement process. How should they approach that though? There's probably a like a good way. Sending a fucking DM. What the fuck, bro? Exactly. You know? I'm assuming that's not recommended. Yeah. It could be. So if you expect them to answer, then cool, right? So it's like the song came out. First step, if I have their info, maybe like let's say what paint the analogy for me. What's what paint the scenario? I don't know. I'll go through what I would do. Because I could go through a bunch of situations. I would do different things. I guess probably the most common is like I uploaded a beat on YouTube and a big, a bigger artist, way bigger artist than me, as far as like me as my producer. Yep. Like I hear this song because once again I heard it from this popular artist.

Yeah. What the fuck? I don't know anything to do with them. Like literally, I have no contact with them. I've never messaged them. It's just my beat got ripped and it's on their fucking project. Alright, so somebody stole your beat off of YouTube and they're a major label artist. Yes. That's the case. Let's do that. All right, Is that good. Simple. Right? Approved. Approved. Simple, simple, he says. I'd love to hear this. Okay. First thing is you figure out who to reach out to, right? So, like, this is what I suggest. You the best way to figure out who to reach out to is gonna be their lawyer, their AR, their manager, whoever is in charge of the clearance process. How do you do that? You talk to other people who also worked with the artist before. So I would reach out to all the co-producer or all the producers that I would reach out to all the producers that worked with the artist recently. So go on their recent album, reach out to all of them, DM them, be like, hey, I haven't gotten paid for this song. One, have you gotten paid for this song? And two, who did you speak with? If you reach out to everybody in the album, somebody will answer you and give you the person to reach out to. That's a good one.

So you reach out to that person at that point. So that is the first step of the placement process. You reach out to them. Now, what if they don't answer? Is that they don't answer? What do we do? All right. Well, at that point, there's only really you you follow up every two to four days consistently for a month. That's what we do. We follow up every two to four days consistently for a month. We send a very professional email. We have templates on our Instagram page. If you want to go to the Instagram page, we have a template that we use. Um, but we adapt it depending on the situation, but we use a version of that. So sometimes you are going with what the fuck? No. Oh, okay. No, it's like if you're a producer, I don't know what you meant by adapt. I was like, are we? adapting? We've never sent DMs. It's Like, well, I have, but it doesn't. Yeah, we find the lawyer. I mean, most of the time at this point, we've worked with most major, we're talking about major label artists right now. So like we've worked the most my company only works with major label artists. Okay. Yep. We work with some independent stuff, different thing. But I don't want to get too off track. Yeah, okay. Okay. All right. So, So we're reaching out two to four days for a month. Give it a month. Let's say then what? And then at that point, they're still not answering.

You get you amp the aggression up a little bit, like every time you send a message, just a little bit. Just a little bit. Not too crazy. Let them know. And if they still don't answer you, you only got one choice. You gotta file a song takedown. But this is what we do. We file a takedown just on Spotify. Why? Okay. This is why. Why? Because if you file it on Spotify, it'll send them all the information. And when it sends them all the information, like that you just filled out, hey, I I have this, you know, we have another template, a Spotify takedown template on our Instagram page as well. Yeah. You can use that, go on there. It's a very it touches on all the bases that touch on the DMCA copyright act and the things that you need to say on it to make it more likely Spotify will comply. So you use that template and then use that, and then it'll send the artist all the information, and then usually they'll reach out to you to from there. Because if it's important to them, they'll reach out to you. Yeah. How do I do it? Takedown. Uh on Spotify, you go look up Spotify DMCA takedown. Okay.

And then you Google that first link that'll come up, it'll say like file legal report or some shit like that. You file that out. And then uh yeah, it's a couple steps. You uh set ideally give them the link to the original file, whether that's the beat, whether that's the YouTube page, like it'll ask for a few details. Sure. Um, you fill that out, and then that'll get sent to the artist, and then the artist will usually respond right away because it'll tell the artist like, hey, um, if you don't answer within a couple days, the song's gonna come down. So they reach out to you, and then when they reach out to you, what we do is we'd be like, hey, if we get this resolved quickly, then we'll take the we'll retract the claim, and then the song can stay up. So we file takedowns, but the song usually doesn't stay down because we found that the bigger the song, all right. So we found that if it's a smaller artist's biggest song rather than a bigger artist's smaller song, we're more likely to get be successful. Sure. Because it's it's more important to that artist. Yes, yeah. You know what I mean? So um if it if you if you imagine an artist that has like a couple million Spotify listeners and it's their biggest song, their fans love it, that song is so valuable to them. Versus being a bigger artist, smaller song, they don't give a fuck about that shit.

Yeah. So something that we've like joked about, even just dealing with Henry's. And then you're on step two. So that's good. That to fit wrap up, like if what they reach out to you, then you're on step two. Sorry to cut you off. But yeah, yeah. No, yeah, that's good. And so then, like, I mean, do you have the leverage in that sense? Like, is it almost is it better to get to this point than to just yeah, like, can you ask for more because the song has proven to be successful and it's valuable for them. And is that is that kind of kind of seedy a little bit at that point too, though? Yeah. So I would say that if the song comes out and they didn't, if if the song comes out and they didn't pay you for it, you have more leverage. Yeah. Yeah. Right? Which is for sure. Why not? Why wouldn't you? But there's also a sweet spot for it, right? Like, if you wait a long ass time and the song proven to not be successful, they don't give a fuck about that shit. Yeah. Okay. Let it come down. Oh no, you took down track 12 on my album and did five streams. Okay.

They're not getting paid for it. It's kind of high risk, high reward here. Yeah. But if it's a fucking single, they got a YouTube video shot. They already spent fucking $20,000 on that. Like you have all the leverage, bro. They're not trying to waste that money. What's another 10,000 that they put on the producer when they already put 50 behind it? You know what I mean? The example is like Sting, you know, they did Juice WRLD had the lucid dreams song. It was an interpolation of Sting's song. Sting waited a very long time. Like he they saw it was getting big. He let it get huge, like massive, before they even started the whole legal process. And then he had insane leverage, ended up with like 80 something percent. I love that you bring up that example because it's like there's also like if it's uh you waiting is very uh deliberate, then that could also be considered by the court too. Like if you do actually go to legal proceedings and it goes uh then they could consider that of like you not bringing it up in a certain period of time. So I don't know what the statute of libertations is on that. Yeah, so you have to consider that as well, too. Oh wow, yeah. Like if you, you know, you can't they could penalize you for that. They could Yeah. For if you heard it.

Yeah, and there is a statute of libertations like you found about it. I don't know if have you ever heard a statute of Libertations? Yeah, totally. I just don't know what it is for like hearing about this song. I don't know what it is with the songs either, but in theory, if the crime happens and nothing gets done about it in a certain amount of time, then you can't file a claim for it. So I think he has a pretty good case, you know, I'm an old white guy. I didn't know about this juice WRLD song. Juice WRLD. Yeah. You know what I mean? Oh, yeah, don't call me on that shit, because like I don't know too much about it, but yeah, for sure. And something like that. Hey, sorry to butt in, but you're an independent artist, right? You have great music that you want the world to hear, right? You know that organic social media posting is the best free way to get exposure and market your music, right? Most artists understand this, but they get paralyzed because they don't know what types of videos to make. What do I post? Luckily for you, the one more time podcast has gathered a list of 100 viral content ideas specifically for musicians that we're giving to you for absolutely free. We've seen these formats crush time and time again. They really work. Take these ideas, insert your personality, your music, and watch the views start rolling in.

All you gotta do is go to 100viralcontentideas.com and you can have the entire collection in your inbox in minutes. So sorry for the interruption. Please forgive me. Let's get right back into it. Let's talk about now, because I think we we've talked a little bit about obviously, you know, in more hostile, or not even hostile, but just in situations where the producer didn't get um done right by the artist, right? In in this sense. Let's let's talk about how can we do it better? Like, how can we go about it the proper way? So all right, exactly. So I'm an artist, I get in the studio with Henry as a producer, we're gonna make a song, right? At what point do you recommend that like splits and the business is discussed, right? Because like we've heard really differing. It can get awkward when you bring it up too early. We've it's weird, it messes up the vibes of the creativity for sure. Yeah, so so we've heard differing opinions on this. What's your stance to like your clients that you work with? Kind of what's the guidance you give them around that like approach? Yeah.

I I love that question. Um, I'm not in the studio with artists, so consider like I can't even tell you what happens if you do do the ideal situation. The ideal situation is you talk about it ahead of time. That's obvious, right? Like, we're doing this business and we're good. This is how it's gonna be resolved. Now, does it play out the ideal? I'm sure there's plenty of times where it doesn't. Like, if I have this conversation right now, it's not gonna play out as I would like it to, right? But like, I mean, the ideal situation is you talk about it. Hey, I'm in the studio that hey, by the way, you know, my beats are 2500. So if you're using this, then that's how much I'm gonna be expecting from it, you know what I mean? And I also want three points on it, you know, and uh there's you know, this is what I'm expecting to get paid at this amount of time and I want this type of credit. It was the ideal situation. If, if, if that's what you're asking, but I mean, how It's not realistic though, as someone who is in the studio with artists, like it's it's weird to say, if someone comes in your studio for the first time, you're trusting them with your art and to create and to vibe with you to be like, so I want this split, I want this advance, I want that. Like, that's already throwing the whole shit off.

Especially as a young guy, I can imagine. I I've never been in that situation, so I can't tell you. Because like you have a more valuable perspective than me on like when is the ideal situation? Cause I'll wait too long and then I'll miss it. So, like, I think you have a you know, there's your side is valid too. You can't Tell when it's like, all right, well, maybe if I would have said it earlier, I would have gotten this. You don't know. You have no idea, right? So, like, and I don't either. It's it almost feels shady both ways. Because your way feels so shady where you like don't talk about it. And then it's like the songs are. Surprise, I want five grand. Yeah, exactly. I love that you said that, bro. I've never heard that before. But then like that. But then, like, the upfront, I agree too. It's like, I want five grand, and they're like, Okay, get in the booth. Yeah, this will be five grand. It's horrible. They're not going to give their best performance. Oh man. Um, okay, so just so there's no good time to talk about this. There's no answer, bro. You just gotta like be somebody that's socially intelligent and be like, yo, if I bring it up, I would personally say, although again, I haven't been in this situation, I will kind of test the waters. What kind of person is this?

Is this somebody that does like to talk about percentages? Like, I don't know what I would even ask, but I would like to think I would find something to just like, you know, I'm I I would like to think I'm socially intelligent, intelligent in some way. Um, maybe not intelligent in general, socially intelligent, maybe like, but so I I would like to say think that I would give a probing question to see how they would react before hitting them with the fucking this is how much I want, you know what I mean? Here's my thoughts. Here's my thoughts. Okay. All right, I I think asking to your point, like a probing question. My version of that would be how do you typically handle you know, working with producers? Like, so if it, you know, if if I'm the producer and I'm asking the artist I'm in the studio with, like, how do you typically like to work with producers on the business side? And then you just shut the fuck up and listen. I love that. Right? I love that. Because it puts it on the artist to then because once again, the artist is the one funding all this shit. So I think we do need to be a little bit like empathetic. Yeah, is it sympathetic? Or empathetic. Are we sorry for the artist or the understanding of the artist? Sympathetic, empathetic understanding.

Okay, bro. Anyways, yeah, I think that like trying to understand, because I think the producer should want a great, because I think a lot of producers are too short-sighted. I do think that like you can fuck, you can block your blessings, bro. Like we just had FKI first on the podcast and he talked about like everything's negotiable. If he would have asked, if he would have asked Post Malone for a fucking advance on White Iverson, which is now Diamond, he would have been fucked. That song would have never come out. Post Malone, he said he was on his last three cigarettes, the dude had no money. Right. You wouldn't have gotten this, you would not have gotten the White Iverson song that we all know. It might not have come out even. Exactly. It couldn't have. Yeah. If you would have taxed him because he just he wouldn't have been able to afford it. So here's so based on that, here's my just personal like and the way I go about it. What you got, as someone who has worked with artists. I think that if you are okay with work, you've agreed to work with an artist, right? That means you believe in them to some degree, at least. You like their art, you want to support them, you want to see what you can create together. I think you need to be okay with at least maybe not bringing up anything until like once they've said that, like, okay, we want to put this out.

Once they've said like this is being released at this time, then I think it's a good time to be like, maybe, how do you typically handle things? You know, who's your person? Do you have a business manager? Do you have a lawyer that I need to talk to? But like, if you can maintain kind of the vibes at least long enough, because you've agreed to work with them, like have some faith at least until they've they've also had some faith in you to decide I'm willing to release this song that we made. Yeah, because if the song's not gonna come out, it's a fucking moot point. It's a wash. anyway. Literally, move on. Who cares how they handle the business because there's no business to be handled. It's gotta be coming out. Um I love this conversation, bro. Cause I I never like the amount of all my podcasts are focused on the producer side, and we don't even touch on the side. No, bro. We gotta, and that's the I'ma, I'ma just throw a little bit of shade at the producer community. I do think that they're not putting themselves in the space of the artist enough, bro. Who has to pay for everything. And it's it's just more about like guys, do you want your songs or your beats to be like made into songs? Because if so, we need to be a little bit understanding of what it is the artist has to deal with, and like you know, and once again, I'm also sympathetic and empathetic of the producer community because I think that they get fucking walked on and like fucked over time and time again.

So I think it's just this it's just this balance that I feel like we're still like there's still too much of a fucking disconnect, bro. And I think it does have to do with transparency. But I had a question as far as like all right, if I'm a in a an artist and a producer, song comes out, we don't discuss the business. Is there a legal default? Or is everything just negotiable? Like, is there a legal default to how let's just use the simplest example? One producer, one artist, they make the song perfectly collaboratively, right? Like, is there it doesn't matter? It's half. Okay. Yeah. Yeah. Yeah. Don't put this don't put this as a clip, but it's half. Wow. Yeah, it's half. Like that's it. Like that's the half of the publishing, not half of the master, to be clear. Like the publishing is typically You made the master together too. Yeah. Yeah. It is It's a copyright, it's a different type of copyright. But it's still a copyright. Like the copyright law, if you make this together, it's my understanding of it. Yeah, you know, I want to leave a little space.

That's why I like don't put this out of the book. But like, yeah, like you made this together. Dude, producers typically end up with two, three, four points. Yeah. Yeah. You're talking about 50. That's what I'm saying, bro. Like the producers have more leverage than they really realize. Yeah. Yeah, for sure. Yeah, bro. Like, this is a clip, bro? What do you mean you don't make a clip out? No, you can't, bro. It's too much illegal. I walk the legal advice suggestions thing a little too much. So yeah, this is what I can't make. a clip out of. That's what we got you on here for, Daniel. Come on, man. Fucking lawyers. in particular. Fucking lawyers. Bro, you're telling me I'm the one that's fucking. I post shit, and then the amount of lawyers that like, bro, you like fuck them. this is giving legal advice. You can't do that. Blah blah blah blah. You're giving much too much information. Do you realize you're subs you're you're like, bro, I put the Spotify language, this is what I would say if I if I was firing a spot, and this is what will make it more likely your song will come down. And I had one of my biggest inspirations in the space say, like, bro, you can't be saying this. I'm not trying to like hate on you, but like you can't say this because you're suggesting to people like this is legal advice in a sense. But it's like, bro, I'm just trying to help you take a song down.

Which I guess it is, but at the end of the day. He's just worried about his bags. Yeah. but why? So what is the problem? So even if it was considered legal advice, what's the law about it? Well, the biggest thing for me right now that I'm most concerned about. Because you're not a lawyer. Not yet. So if you're giving legal advice before you're a lawyer, okay. What about if you can't. But if you are a lawyer, then somebody took your advice. Like, if you see lawyers putting this is not legal advice, that's a liability thing. Because if I took your information and I applied it and it didn't work out right, then they could sue you, being like, I thought he was my lawyer. Who the fuck's gonna do that? So that's why I'm personally not worried about that. Maybe I'm ignorant, maybe I'm the young guy that doesn't understand what actually happens. But I'm not like when I am a lawyer, I'm gonna be, I'm gonna be way less uh worried about it than I am now. Bro, I was yeah, I'm concerned if our courts of law, let's say you heard him say some shit on an Instagram reel, and I was like, that's my lawyer. You and you're allowed to say that this is my lawyer. Bro, it's something like that. We are fucked as a society if

that is upheld in the US judicial. system. I took his legal advice. And, like, this guy was getting, because you can't, like, I don't know. There's all these ethics, bro. Like, you have to, people don't know. I took the bar exam, right? But I had to take two other tests aside from that. So there's the New York state law test, and then there's the ethics test. too. So it's like, yeah, they're not hard. The bar exam takes many months to study for. Each of those, the the New York State law one, I didn't study at all for. It's just the open book test, so I barely studied for it at all. Wow. Yeah. And then the ethics one I studied for a couple days for. So it's not hard, but they are things that's like there's a lot of rules to this shit. They give you these tests because there's a lot of rules to being a lawyer, you know what I mean? So you can't break them, otherwise they'll disbar you. They won't let you be. Like if you're doing unauthorized practice of law, they'll investigate you and stuff. So I have to extra tiptoe that line. Yeah, yeah. So I'm still trying, very adamant on being like, bro, this information should be available. The old generation of lawyers believe that, like, yo, if I'm a lawyer and I'm sharing information, that means I can't charge you as much for billable hours. And you know, that means my clients are more empowered, and if I share stuff online, then they're not gonna need me anymore, or they'll just go somewhere else, they'll do it in the so it's like I'm not personally worried about that because I've seen enough case studies where I'm like, yo, these young lawyers did this, and and they turned out way better than the older lawyers.

So I don't know. I I got you right now. Watch this. Nothing in this podcast is legal advice, and Daniel Cruz is not your lawyer, unless he did you, you know, you hired him, like for real. They can't yet. Don't be fucking dumb. All right, let's move on. I I fucking wish. Thank you for that. I picture the bar association watching this right now and be like, yeah, nah, you still gave legal advice. They said that somebody would have. Yo, hopefully you are maybe like a lawyer by the time this comes out, Should we wait until the official results are. out? It doesn't matter. No fucking. Um, all right, so we you know, we kind of threw out like a few different just random numbers of advances that like producers could charge. I think you were like 2500 for a beat. We were like 5,000 for a beat. I do feel like sometimes, like once again, like just me even representing Henry as a producer, like when we first started working together, we were just shooting from the hip, bro. We had no We kind of based on what we think they can afford. I mean, if that I don't even think there was actually really any thought into so if I'm a producer, once again, I land a placement, right?

Let's see. just use the major label placement example, right? Even though um, you know, a lot of our community isn't signed to a major, but I think like this hopefully will be a way for us to like help producers out there that are getting these plates of placements. Um let's say I catch my first major label placement, right? Like, how do I know how much to charge for a beat? Is there a formula you kind of use and you're there's definitely no formula. The safe bet is $5,000. Like, if you ask for a $5,000 advance, nobody's gonna be like, bro, who the fuck is this guy asking for this amount of money? Like, you're gonna be good if you ask for a $5,000 advance. I would say if it's more of a you know, a B list A-list artist shoot for a 75. We're talking we're talking first placement, right? Yeah, let's say early on. Early placement, yeah. So I would just say $5,000 is always a safe bet. Don't ask for less than that. I would personally suggest not legal advice, but if you ask for $5,000, there's just no fucking legal advice on here, Daniel. I know this one's gonna be a clip, bro. It is. I know it's gonna be a clip.

Yeah, it's done. But yeah, so yeah, $5,000 is safe bets. But if you're working with uh, you know, a bigger artist, like somebody that's you know that then maybe you'll touch $7,500, maybe you'll touch $10,000. Now, if you have multiple producers, does that increase the amount that you're able to ask for? I personally don't really think so. Artists would rather talk on all in terms, which means the amount that's going to all the co-producers, it's including all the expenses of it. So when let's say I'm an industry producer, right? And I gave the beat to an artist. A lot of times the artist doesn't even know that there were six other people that made this beat with me. Because I they they're just talking to the industry producer, right? So like they'll be like, hey, we're proposing a $5,000 all-in fee. So the all-in fee is that's me saying if you have other co-producers, that's between y'all to figure out this is how much we're giving you. So they say most of the time when they reach out, major labels, they'll be like, We're giving you a $5,000 all-in fee. So then it's like, oh, this guy is saying, you know, I'm asking for this amount of uh it's like, no, we we this guy agreed to a $5,000 all-in fee. Now there's a whole nother conversation.

Well, if this guy agreed to it, um, and he's the industry producer, he made the play. Does that mean all them have to agree to it too? I mean, it gets messy. They definitely don't have to. That's for sure. They definitely don't have to. Now, should they? I mean, shit, how much how important is this relationship? Because if this guy just agreed to $5,000 and he made the play, and this is his relationship, and you just made a loop. How important is that relationship to you? But if you want to ask for more, you can, but that probably will fuck up this relationship. Yeah, so that's something to consider. Like, you gotta consider this, could you? You definitely can. You're not bound by what he said. This is this is your contribution to the beat, it's a different thing. Yeah, but dude, this industry is tough, man. There's no other thing industry like this, I feel like it's crazy. I didn't also know that from the artist side that I didn't know that they were taking the stance of all in types of arrangements. Sure, you did. No, because bro, when I I was negotiating shit with you and your co-producers, yeah. I thought we I got the full thing one time and then we split it one time.

Nah, bro, not even. We doubled it for that, bro. I'm not gonna say always. I'll say that, you know, experienced artists team that are looking to maximize, like they know that the situation they've dealt with these situations before, they'll put that all in in there. Does that change the fact that this guy's asking for more? Not necessarily. Yeah, but if I I know if I was representing an artist, I would be like, yo, this is the $5,000 all in fee. This is what I'm giving you, bro. Yeah. So this is what we're offering. Yeah. So talk to your guys. Like talk to your guys and be like, yo, do we agree before you tell me that we agree? Talk to your fucking guys. And a lot of these guys don't know like to do that. They don't think to do that. So hey, Henry here. Sorry to interrupt this podcast, but there's something I have to address. As many of you know here at one more time, we love doing live music reviews. We love hearing the music from our community and providing helpful feedback that is hopefully helping you further your career. But if there's one piece of advice that we are tired of giving, it's that your master is too quiet. We shouldn't have to turn up the volume for your song just to have to turn it back down for the next song. That's not good.

But Henry, good mastering engineers are so hard to find and so expensive. Enter DistroKid's newest tool called Mixia. I master music myself. And while I don't think AI mastering will ever replace the quality you get from an experienced human mastering engineer, it's pretty damn good. And if you already distribute through DistroKid, you can now master unlimited tracks using Mixia. And if you don't, we have a link right here. You can sign up for DistroKid with 30% off. Upload unlimited music yearly for an insanely cheap price. Humans perceive louder as better. It's dumb, but it's true. Use Mixia for a clean master, and you won't sound weak on that playlist. Let's get back to the episode. Okay, so you mentioned in your example, I got six co producers on the song. How many producers is too many producers, bro? Bro, I'm gonna I'm gonna tell you, this is my perspective on it, right? you can have as many producers as you want. The question is, as the producer that landed the placement, how much risk do you want to take on? Yeah, because it's like the more producers that you have, how many random producers is maybe a better question? Because it's like, bro, if you have five random producers, then it's like, bro, you're basically being like, all right, all it takes is one of these guys to completely fuck up my relationship.

It's like, bro, I would just say, like, you can have as many producers. All you have to know is like if you have five producers, no, you're splitting that shit in five. And are are they solid? Yeah, are they solid? Are they gonna fuck up my business? Are they gonna ask for a shit ton of money and then be like, bro, because all it takes is one of those guys, and like you said, a lot of people don't know how much a beat is worth. And it's it, I don't think it's on, bro. The first time I saw, the first time I worked on a placement, I was looking at NLE Choppa. I'm like, wow, this is amazing, bruh. I was like, but how much do you ask for? I'm like, if you would have told me 25,000, I'd be like, okay, word. 25,000. No, that's not how much it's worth. It's not worth that much. So it's like, all it takes is one of these guys is their first placement, and they're like, yo, I'm asking for a fucking 25,000. It's like, bro, they don't they don't know. They don't know. How often does that happen? Uh it happens a good amount. It happens a very good amount for sure. So if you're working with me, then it's like that means that you're the person that didn't get paid. So, like, we're helping, so we're not doing that. We'll tell them, bro, this is how much it's worth, bro. Yeah, if you want to ask for more, we're not doing that.

Because, we stand pretty firmly, like, we're not trying to do bad faith business. We're not just trying to fuck people over and get the most possible that's completely unreasonable. We're trying to actually get you what you're worth. You know what I mean? So I'm not doing that. So, in the situation where you know, someone does come out of the woodwork and asks for something that isn't reasonable, right? That isn't what it's worth. What's the approach? You know, what I mean? that song never comes out, man. Well, it's a tough thing, bro. It's the quite toughest thing. I just I was just asking Bobby Critical this. I I have a conversation a lot on podcasts because I don't know the answer necessarily. Here's one thing that happens, and actually would like to get your opinion on this. This is something that I even like participated in a long time ago, not anymore, trust me. But oh god, I don't know where this is going. People will people like if uh say someone sent a loop, you know, like some of the best loop makers are in Europe or like South America that just sent fire loops, and it's like they're like big industry producers, not saying any names will employ some of their you know smaller producers to literally like remake or rebuild their loop, these other people's loops to cut them out of the scenario. I love it.

It's like let's remake this. You know what I mean? For sure. Is that legal? Oh well, I mean, can you even it's not legal advice, but is this is that okay? Yeah, is that okay? Is that okay? So the all right, so I'm gonna give you a real life situation I'm dealing with right now. So one of the albums that's I don't know when this episode is coming out, but one of the albums I'm working on that one of the albums I'm working on that's coming out next week, right? I don't know when it's coming out. Sure. But yeah, it's one of the biggest albums that's gonna come out this year, right? It's coming out next week. Can you see? No, bro. I can't see Can you tell us? Can you tell us? I'll tell you yeah. Can we bleep it? Seriously, we'll believe it. Can we believe it? Yeah, we will bleep it. Yeah, I swear to God. You can see the episode before we drop it. All right, so I'm working on this album next week. It just happened like Yes. For real? Well now it is. You just kind of gave it away by saying that. Fuck, bro. You can't put that in there either. We got to bleep you too. Take mine out, take mine out. Or bleep mine out. Yeah, okay. All right. All right. You better put that shit out. I swear to God, we will, we will. We will. All right, so yeah, so that producer, he came in and he tore like bro, he was in the studio with the artist, and the the artist played the beats for the producer, and the producer is like, nah, this this beat doesn't fit the vibe of this song. And he remade the entire beat.

And he did that like three to four times, something like that. So now he he's dealing with a situation where it's like, all right, so the original song was made. Now, when that song's made, like you guys made that together. So remember what we were talking about earlier? It's like now you both own the copyright to that song equally. It's not like you own the beat and he owns the lyrics. No, you own that song together. Now this next producer comes in and the beat, you took it out. Yeah. But the original producer still owns half the song. Yeah. So it's like, all right, so you took the beat out and you made a new beat, but they created that original copyright together. So now you're in there making a new beat to it, but it's like fuck, bro. It's not a new copyright when they make the new song, quote unquote. Yeah, so it's so it's so iffy, bro. Like this is a very interesting space. And it's like with the composition side, I would say that no. But I I I there's not much case law to really decide this type of stuff. But my personal opinion is like, all right, they, they made this underlying composition copyright, they even made the you know new master. I I would say that the original guy owns the new master, and then they made this guy remade the master.

So it's kind of like a derivative work, or is it a new like what is it? Whoa. I don't know. I bro, I don't have the good answer for this, but like there's a good enough claim where it's like this guy's reaching out to you, resolve that shit. Like find a way to resolve it. Okay, so you're in the middle of it. Yeah, so they, you're still working through this. yeah, it's one of the biggest managers in in over there, and like, you know, um over where? Korea. You guys, I mean, it's close first bro. I can't make it obvious, bro. But yes, over there in Atlanta. Over there. Yep. Yeah. Where is it? Way over there in Jersey. I think it's Puerto Rico. Okay, anyway. So, yeah, one of the biggest managers over there in Puerto Rico is negotiating for us. Now everyone knows it's not Puerto Rico. bro. Reach out, and even though he's normally able to resolve it on his own, it's like, bro, this is enough of a situation where it's gonna be a dispute, it's gonna be an issue. Bring in the legal team, the management team, whoever you gotta bring in to kind of help resolve that.

Yeah, yeah, for sure. So just from your lens, right? Um how do you think the music industry can evolve to better handle like payments and the business side, like all this like artist-producer relationships, and then even like collecting the royalties once we have agreed on like what percentages we all get, right? Like we still hear a bunch of grief around just getting the money, right? Like from both the artist angle, the producer angle. So, like, is there anything that you think should be done, right? To just improve the overall experience for us, yeah. For specifically producers, let's just say let's, I mean if you want to touch on both, but like just in general. I mean, I would just say my my perspective is not too valuable with artists. Okay, so let's let's just say from your lens. I think I have to focus on producers. So with producers, I would say, well, the first step is all right. So if you want to pay the producers before the song comes out, don't clear the song a week to four, like, don't decide on what songs are gonna be out a week to four weeks before the song comes out. So if you don't solve that issue, then the likelihood the producer gets paid before the song comes out is very slim, right?

So it's like that's the first issue, right? Yeah, it's so but is that gonna get solved? Is that reasonable? I mean, we can take it one by one. I don't think it is we're talking about art here. Exactly. It's always changing. It's also lightning in a bottle. We love this new work of art that we just did. Yeah, I don't know. Yeah, that sounds it's not gonna happen. I mean, maybe it could happen, I guess. If like uh, you know, if they plan more, I guess. Like if you're like, all right, now we're gonna plan like this is what we want to do. It's okay, cool. We got Kanye out here tweaking the mix like an hour before it drops. That is, and not paying them until fucking ever. Yeah. Okay, so that's one. That's the first step, right? Let's plan a little bit more. Then Let's start these negotiations a little bit earlier. Yeah, a little bit earlier. So that's one thing you could do. Start them earlier, right? Then the next step is all right, now we actually have to decide on what the terms are. So, okay, so now the question is can the lawyers move more efficiently? For sure. They could definitely move more efficiently.

Yeah. How? I mean, they have to pro prioritize it more. How are they gonna prioritize it more? It has to cost them more money to do it because they have more expensive things to do, or they have to get better at delegating, right? So it's like, okay, so if they get better at delegating, they have more hands to do it, and they realize like, you know, it's like if the more people I have the more hands I have doing it, the more efficient I am. Most lawyers aren't good entrepreneurs because they were trained to be lawyers They're not trained to be entrepreneurs. So they don't know how to delegate, they don't know how to scale. They get stuck in. I could talk about this shit fucking forever. But yeah, but like because the old guard versus the new guard of lawyers. Him and him and Ryan Schmidt would have a field day. Bro, that's my fucking guy. bro. Talking shit about old lawyers. Yeah, I love Ryan. We were just texting. him today. He's one of my favorite people, bro. Like, he's actually my favorite lawyer I've met in the industry, bro. Like, for real. He's a stand-up guy. He's Not afraid to make content and give value to people without feel like. But he probably should put this in the legal advice. Yeah, bro. I don't think he's going to do it. You're going to give Ryan legal advice right now. No. Okay. Okay.

I go fuck myself Okay. Anyway. All right. So. all right. So the lawyers doing things a little bit. Doing things more efficiently. Pay them more, they'll act faster. Is that something we want to do? Do we want to pay the lawyers more? I mean, I guess you could, and will that force them to act faster? I mean, maybe. I definitely want to pay Daniel Cruz more if he's my lawyer. I mean. They make a lot of money. They're already charging us too much. Let's be honest. Lawyers are doing fine. Ryan Schmidt told me how much he would bill us for a fucking you know agreement for us. Like, Jesus Christ, yeah. Can't afford that. We're just gonna have to go on the handshake agreement. 5050. Okay. So there we go. So that's that. Is that are we gonna get lawyer pay lawyers more or get them better at building a business to be more efficient? I mean, you could try. I'm trying. I'm trying to do that. Is that gonna happen? Maybe. these first two ideas suck. These fucking ideas suck, bro. So that's what I'm telling you. Do we have anything else? The next step is are we gonna make all right? Cool, the agreement's agreed to, and that's closed on.

That's great. The fucking contract signed, that's cool. Now the next step is the label processes. So the label has to actually the label admin, the label A&R. The A&R administrators, whatever that label wants to call them, has to go through the actual okay. You sent the invoice, and now it's time to pay you. Now that could be streamlined as somebody who doesn't deal with either, like I don't touch that side, right? So I don't deal with like what it looks like to be an A&R admin and to like actually process invoices and all that. Yeah, I mean, it definitely seems like that could be streamlined a lot and be made more efficient. Um, I do believe label ARs are overworked and they don't have enough time to deal with the stuff that they do, and I'm sure it's fucking excruciating to look at a shit ton of invoices and like fucking have to deal with that and like go through all that. So, like I this is the main advice I say for people who want to get paid faster. I say, for one, follow the fuck up. Like, people reach out to us, they send two emails, they're like, bro, the label's not answering He's like, bro, you got to follow up, you have to follow up. Like, we're blessed at a at a point where it's like, all right, they know if they see a producer royalty email, they know that this is not, bro. you're gonna see five within the next two weeks.

You don't answer that. You might as well answer this one, bro. It's not the last one you're seeing, you're gonna see this shit five times within the next week, so you might as well answer it. So that's one thing, and then also they know that for one, like come correct. And I say this all the time because it's like if you want the label to answer you, think about them for a second. It's like, all right, they asked you to send an invoice in the vendor forms. All right, I feel and they sent you instructions to do it. If you send a vendor form that has 30 errors on it, what does that require them to do? That requires them to send you an email explaining the 30 errors that you just sent them. You sent the invoice that's incorrect. They have to go through that and send you the reasons why it's wrong and walk you through that. As a person that takes somebody that's like, all right, bro, like I'm gonna click the email. Like, if you're looking at a uh it's an endless stream, I'm sure. If you're looking at all that, which one are you gonna click? Are you gonna click the one that's like, all right, Daniel Cruz? I know every time I click an email with him, it's a seamless process. I'm moving things along, it's big cases. I'm gonna click that one, or you're gonna click it from fucking JoJo, the producer that sent three trillion things wrong. So know what you're doing, and yeah.

So it's like Damn Jojo. That's the only one. Get your business right, Jojo. His beats are fire though. Yeah, but the invoices find a business manager, Jojo. That part's not cut out. You're not cut out for that part. All right, all right, all right. That's the only thing we have control of. So I I said three things. It's like, are you gonna, you know, are you gonna get the songs released sooner? Are you gonna get the lawyers to move faster, or are you gonna do what you can do, which is come correct? Yeah, probably the only thing. That's the only thing you have control of. The last one's the only thing we got, really. But that's it. All right, so I, you know, before we uh before we end this episode at all, I need to I need to cover this, all right? Okay, can you just as best you can, like, as if you're talking to kindergartners here, can you break down like the royalty landscape for us a little bit? Right? Like, just for people that don't really understand like the types of royalties that are generated every time a song is made and released out into the world to make money. Like, can you just I don't know if you have another like course on this shit or something? I mean, I had a whole chapter on it. So I can do my best to explain it right now.

Cool, please. As quick as possible. All right. So the royalties that exist, right? So you got two sides. You got the master side, and then you got the publishing side. All right, what's each? Like, I've heard people on your show explain it wrong, bro. I'm not gonna lie. I've heard a few. Who did it? No, no, no. Tell us after. We'll leave it after. We'll leave it after. No, no. I actually don't remember. I just remember watching interviews and just hearing it was wrong. I don't remember. Dude, that's what's crazy though. That's how confusing this shit is. Yeah, people. I mean, because we'd like to think we have like credible people in the industry that's still it's that confusing. So it is that confusing. It's like the American tax system, it's confusing so that the people that study it and are smart can take advantage of the people that don't fucking understand what's going on. Yeah. So okay. I might have been thinking of another show. I just remember thinking about it. No, no, I you might be thinking about our show, sadly. Let him cook, let him cook. Yeah. So we got the master and the publishing. Yeah, you got the master and publishing. And explain. So all right. So what's the difference? I would like to. This is the easiest way. I know how to understand it, right? So uh if if I think of a song, and you got two elements of it. You got the notes, and then you got the lyrics.

Those are the two components of the publishing side. So it's like if I were to write the lyrics, and I would write to notes onto a piece of paper, that's the the publishing side, aka the composition side. Yep. As soon as I record that, I make a recording of it, I sing it myself, or have somebody else play the piano to it and sing it, whatever it is. As soon as I record that, I made a master recording of that underlying composition, aka the publishing. So yeah, and then it's like uh, so you got two sides. So there's the unrecorded song and the recorded song. Oh that's it. That's the owner you can own publishing without the song even existing. Yeah. I love that you said that. That's a good way that's not talked about at all for sure. Yeah, yeah. So I mean, that that's uh the simplest way, and I could sometimes like it took me uh 10 people explaining that in different ways until I internalized it, you know. So I can explain it in other ways, but that's the way that made the most sense for me. No, for sure. No, I think that's good. So then now those two things exist. Those are kind of like the two different types of copyrights. So then what types of royalties, or I guess maybe like what organizations should producers and artists make sure that they're signed up with to be collecting all the money that those both make. Yeah, right.

So I'm not sure if you can, you know, start with the master and like where do I get my money tied to the master copyright word? So yeah, so on both sides, there's three main revenue sources on both sides. So on the master side, there's what I call there's not an official name for it, but I call it the master royalty. Or maybe you might want to call it the label royalty, or maybe you might want to call it something else. The the master royalty is what the distributor, the label collects. So whoever released the music, they will collect that. So whether that they're collecting it from Spotify, Apple Music, YouTube, whoever it is, whatever the master recording generates on that, they collect that. So if you're releasing through DistroKid or you're releasing through Capital Music Group or Universal, they're collecting the what I call the master royalty. Okay. So that's that side. Sure. There's also the Sound Exchange royalties. So Sound Exchange exists because the United States is one of the only countries that doesn't pay master recording owners when music is played on terrestrial radio. So like in China, North Korea, USA, and Iran. The only countries that I know of that don't pay master recording owners when music is played on terrestrial radio.

Yep. Um we talked about this. Yeah, which is yeah, which is insane. I love that. It blows my mind that that exists. But anyway, so crazy. All right, so Sound Exchange collects. Was created when digital radio was kind of birthed as a way to kind of collect what on digital performance royalties, aka non-interactive streaming, aka like digital radio is probably the best way to put it. Like uh Pandora and Sirius XM. Non-interactive. Yeah. Is what they call it, I think. Did I say that? Did I not say that? Oh, maybe you did. Sorry. Okay. Non-interactive. Non-interactive. I might have said it wrong. So non-interactive streaming. So yeah, sound exchange was created for that. So as an artist, you have to claim all your songs on there. As a producer, you have to get LODs, a letter of direction filled out and signed by each featured artist, and there's a bunch of other nuances to get that collected on that side. And because that that's only applicable once again as a producer if I have percentage points of the master. Yeah. Right? Yeah, because if I don't, then I don't even need to sign up for that. If you don't, you're fucking up.

Yeah, yeah. Well, I know. I'm just saying, but like true, true. Okay, let's just say It's not guaranteed either way. Like it's a different thing. So it's like asking for sound exchange isn't necessarily guaranteed. They could say no. They could say no. Like it is a whole part of the producer agreements that say Oh, really? I'm getting a percentage of sound of sound exchange royalties. It doesn't say sound exchange, like sometimes it does, depending on how the producer agreement is drafted. Like and it's based off of my royalty being divided by the artist royalty. So like I don't know if you know, but if you have a 3% master royalty as a producer, you're not getting 3% master royalty on sound exchange. You're getting three divided by 16 if the artist royalty is 16%. So it's based off of the artist royalty. So if the artist is independent and you have a 25% royalty on the master, then you also get it on sound exchange too. Okay, because it's fully independent. Because it's based off of that's what the contract will say. They're not necessarily collected. Okay. Connected. They're not necessarily connected. Okay, wow. Okay, okay. So we got the master royalty or or or or the label royalty.

We got sound exchange on the master, you know, recording side, and then what else? You said there's three. Yeah, I'll just say sync, which is like, you know, it's just if someone uses the file, yeah, like the actual song that was recorded, yeah, in a movie, TV show, video game, whatever, yeah, you can get paid from that. Yeah, yeah, you could, you know, you get paid on like a lot of times they don't get paid, because let's say you get a $5,000 advance from the label, and then you get a sync that pays you a thousand dollars. Well, it's like, all right, so the sync, let's say the sync paid a thousand dollars to the because like if you get a sync, then like they usually pay, let's say they're paying ten thousand dollars total. They'll pay the the master recording side five thousand and the publishing side five thousand, it's usually equal split. Well, if you're a producer, you only get three percent of that five thousand on this side, doesn't equal much, and that goes towards recoupment. So it goes towards recouping that advance. So it's like you don't. you don't see it, it's supposed to be in your statement. Do you see it on the statement? I personally haven't really seen those things on the statements like that. So that's a whole nother conversation.

But yeah, so you're not gonna feel it. If you're working with a major label, you're not gonna feel a sync on the master royalty like that. I would I wouldn't say okay, all right. And so then now on the publishing side, what are the like the three types of royalties and like places we need to make sure we're we're signed up for? I will say before we get to that side, there's also neighboring rights royalties too. So it's like like we just talked about in the United States, they don't pay master recording owners when music is played on the radio. Well, in other countries they do. So they do pay if your music's played on the radio and fucking some name a country, that's it's probably they do pay master recording owners. If you're crushing on the radio in the UK, yeah, yeah, you're gonna do the same. Yeah, I think it's PRS is the one there. But the thing is there though, is they don't so um I don't know, you have you heard of reciprocal agreements between the PROs? So like BMI does collect performance royalties from other PROs in other countries because those PROs also collect them on behalf of BMI. Okay, but like with with uh the United States, it's like the other countries are like, Well, we're not gonna collect your per uh your uh radio royalties for the master side if you're not collecting ours, you're not paying our guys over there, so we're not gonna pay you. So, like PRS does collect radio royalties on the master side for guys in the UK, but we can't sign up with PRS because we're not paying their guys, so it's not a risk, there's no reciprocal.

But we're not paying our own guys, yeah. Yeah, we're not paying our own guys, we're not paying their guys, so their guys are like, oh, we're not that's how I understand it at least. Yeah, yeah, that's crazy. Well, have you signed the music or have you let your uh local representatives know about the American Music Fairness Act? Because we did partner with Sound Exchange to get the word out there to start getting artists paid fairly. This is just reminding me how fucked that whole situation. Yeah, yeah. It's a fucked situation. I was like, no wonder they're starting this whole, you know, movement. Seriously, but yeah, all right. So on the publishing side, and then on the publishing side, um, you know, you got your performance royalties, every most people know about them, which is collected when your music is played in public settings, whether that's an elevator, whether it's in a concert or restaurant, um, it's collecting performance royalties, but also streams. It wasn't, you know, when there was physical sales, digital downloads, performance royalties weren't generated. So when the general public was purchasing music, you weren't generating performance royalties nowadays. They do. So like BMI wasn't nearly as important as it was 20 years ago as it is now. Because I mean, if you bought a CD, that wasn't generating performance royalties. So now it's especially important.

So you gotta have BMI ASCAP, whatever your PRO is. Um, and then there's mechanical royalties, so you know, uh mechanical royalties are generated from digital downloads and physical sales and other types of reproductions of the song. So you gotta have a way to collect those. So I mean, uh, what organizations you have to collect from? Well, I mean, the United States, the mechanical licensing collective was founded, I think about five years ago, somewhere around there. MLC, MLC, yeah, and they collect from uh only streams and the United States. Okay. The Harry Fox agency was uh around before that, and they were collecting from digital downloads and physical sales. So you had to register with them directly, which you still can do today. So if you want to collect all of your mechanical royalties, well, mechanical licensing collective is very easy, then you gotta go with the Harry Fox agency. But that's only in the United States. Okay, they don't have reciprocal agreements in the United States with mechanical royalties like they do with PROs, where it's like the PROs collect from most other PROs, like BMI collects from most of the other major ones. The uh MLC does not have any reciprocal agreement at all that I know of.

So wow, okay. Yeah. And then is there is there a third on the publishing? Uh then also sync again. And then sync again. And also sync again. Yeah, yeah. So same conversation there. So and is that is that better on the production, you know, producer side, right? Like there's no recoupment associated with that? Or yeah. They also have a bigger percent on the publishing Yeah. Yeah, and that's the thing too. Yeah. So it's like if you have a major label song, you get 50%, and it's like, all right, you get a sync. That's a way bigger deal. Yeah. Because it's paying the both sides equally. Now, with streams, it's like 80% goes to the master side and only 20%. So it's like proportionally, like, I guess, I mean, I don't know how I would process that, but I guess like I like, you know, maybe be more excited if you get a sync because you're gonna get way like equally as much as the artist in some way, you know. So yeah. And your experience, in your experience, which do you think is the most slept on type of royalty? Um, I would say master royalties for producers are completely slept on because they don't even know about them. Like they like so we're like, I'm with BMI, I'm good, right? Bro, this is what happens.

So our producers. That was an amazing producer. So that's the thing, I'm a producer. I can do it. That was just you actually. This is what we get a lot. That was you four years ago. Yeah. I first met Henry, he had no idea about this either. Well, alright. Oh, come on. I need more than you. Ah, well, fuck off. Yeah. So I will if you want me to answer genuinely, the most slept on royalty is the SAG-AFTRA Fund, which is also another type of royalty on the master side. Bro, this shit. I don't want to dig into it too deep. Talking about the Screen Actors Guild. SAG? Dude. But that's also one that's not touch on. But let me answer. let me answer better. Let me answer better. This is good for my business, okay? Listen, Okay, All right. So with producers specifically, the most slept on royalty is master royalties because the producers agree to the advance. They agree to their master royalty and their publishing, right? Well, everybody knows, all right, the advance is easy. I get that up front. Publishing, you know, I get that from BMI and my publisher. They they collect those, right?

And like master royalty, when do I get those? Most producers don't even ask themselves that question. You have to audit the label almost, right? You don't have to audit it. So you get paid them, after your advance recoups, and the song or album expenses recoup as well, too. Now, when does that happen? With a major label song, we say it's usually around 20 million streams. Well, most major 20 million Spotify streams. So most major label songs don't recoup, most major label songs don't even reach that amount of streams. Yeah. So it's like even if you have a major placement, 95% of the time is our estimate, It's like you're not even gonna get master royalties. You're not owed them. So even all these guys, they have placements with Lil baby future, blah blah. They might have us one song with fucking 10 million streams, 20 million streams, they're not owed master royalties. So, all right, what about these guys that have many songs with way over 20 million streams? Well, is anybody on their team keeping track of that and making sure that they are collecting them? 90% of the time, no.

So that's what we found, and that's what we leaned into the most is supporting producers with master royalties. Because like as difficult as the labels make it to collect advances, imagine what we do now and what we've stepped into is supporting producers where they're not owed $5,000, they're owed $300,000. They're owed $100,000. They're owed, you know, many five figures, six figures worth of money. So it's like, imagine how difficult it is to collect that money. So that's what we've leaned into the most now. Our company has evolved into more of like a publisher, but on the master side, where we're helping producers make sure they're collecting everything on the master side. So it's a very difficult process. But yeah, but you said in the majority of cases, that master percentage, I mean, shit, you could have fucking 20% and it doesn't matter. Well, he's he's scouting clients that have huge, huge, made more money on the master than they got in their advance. Uh yeah, so we're scouting clients right now, like you know, uh, my AR team and and my assistant Alina, we reach out to people that are have songs with uh uh preferably a few songs with over 20 million streams. They'll send the message.

If you're watching this podcast, you might see a message that's like, yo, like we see you have this song. Do you have somebody supporting you with master royalties because your advance probably recoup by now? Yeah, the real thing is like the advance and the song probably recoup. I'm not gonna explain all that shit in the message. Sure, sure. Like, yeah, like we've found so much money for people that basically they're like pulled out of thin air because they don't think of nobody everybody talks about oh yeah, BMI is not enough. Like still a lot of people don't know that, right? Well, imagine the amount of people that are saying, like, oh yeah, you're owed master royalties from this song, right? So wow, because like let's yeah, because I mean the average Joe who maybe is like a smaller producer, right? That doesn't have all this industry connects and maybe industry knowledge, and even maybe the bigger ones that do just don't still don't know this. It's like they had a lawyer draft this agreement to your point. Whenever the song came out, they had their advance agreed upon, they had their publishing agreed upon, they had their master percentage, you know, points agreed upon. And then it was probably like forget it almost, right? And it's like if they saw a check, cool, but they're not doing that due diligence to like follow up.

Because once again, I mean, and it's understandable. You're busy, you're making music, you're not a fucking accountant, you're not like a you know what I mean. Um, I could share so many stories with you, bro. And how that's the most amount of money you've found? Um, right now we're working on the cases that haven't been paid out, and uh you gotta bleep the name. So we're working on the all the biggest producers so whether that's like we wound up representing all of them because the guy who um wound up signing all of them to production deals. So it's like the biggest cases we have right now. It's like, bro, each of those songs has a like, well, all right, so it's it's a it's a few billion Spotify streams that like probably a few, it's probably just Spotify streams. Like it's like it's it's at least like four, like four billion Spotify streams alone for these few producers, and like it's gonna come out to, it might be close to a million dollars that they're going to get. They didn't know about it, bro. It didn't exist to them, they didn't know about it. They had no idea.

Shit. They had no idea. So until we reached out to one of them, which was the smallest of the three, like, and we told him about it because other guys were hard to get in touch with, they're huge guys, and they're some of the biggest of the last generation. Until we told him about it, then he wound up being like, Oh shit, I also signed the same deal as these guys. So then he told his friends about it. Yeah, it's a ridiculous amount. And like for them, it's like, bro, we're just finding money, like too like that. Labels must hate this guy. They do bro. They do. Bro, I'm fearful of your just like well-being, bro. don't remind me, bro. I have this conversation with myself. On that note, Henry, let's take it into a final segment of the podcast because I don't want to get Daniel in any more trouble than he's already fucking in. He's already on a couple of lists. Finding a million dollars that people are owed. Holy shit. Yeah. Realism is probably like 700,000, but just to be accurate. Just to be more accurate. We have recovered a million in the last year. It's Roughly a fuck ton. How's that?

Does that work? Anyway, um, this last segment is called the Rapid Fire Rampage. Even if you had seen some old episodes, this part has been consistent. I love this. There are three sections. We'll start with some short answer questions, go from there. Starting with, if a producer makes a beat in the forest and no one is around to hear it, does the producer get paid? What the fuck? I would like to think no, because your beats aren't worth anything sitting in the fucking forest. Rico Brooks, as you said, they're not worth anything in your hard drive, but they're definitely not worth anything in the fucking forest, bro. Yeah. Yep. Hard drive sitting in the forest. It's pretty much the same two things. Facts. Okay, moving on. Um, we've hinted at this like all episode, but let's just get a nice, like concise. What are your three best tips for ensuring that musicians, artists, or producers, whatever, are collecting all of their money? Three things they can start doing right now. Uh, know that BMI doesn't collect all of your publishing royalties. You either need a publisher or to register with every collection society around the world, which is hundreds of them to collect all of your publishing royalties.

So at least know that as a thing. Um, three best tips to collect all your royalties. I want to get all my money for my music, it's good. People are listening to it. Uh yeah. Uh Sound Exchange There's no sound exchange exists. They collect from Pandora Sirius XM. If your music isn't streaming on either of those, then you're not gonna get shit from those. So just know that. So yeah, like if your song's not on radio, it's probably not much on Pandora or Sirius XM, at least not enough to generate that much money. So asking somebody like me to get an LOD for it is probably not worth your time. It's fine. It's fine. maybe it's worth your time, but it's not worth my time. Because you're gonna have like a couple dollars. We had a guy comment like, I've been signed up with Sound Exchange for three years. I haven't made any money. Your music's not on these platforms, my guy. It's not on the radio. It's not on well, that's not a fair you know what I mean. No, I literally like saw that. Yeah, and then like my kids started screaming or something, so I didn't have time to reply, but I want to be like, probably because your song's not on XM or satellite radio, bro. Like, I'm sorry, but for those that are, they're missing out on a bag. Yeah.

So we can't help you there. Well, we can, but just signing up doesn't help you there. So keep on paying the fees though, my boy. Yeah. All right, third one. Uh last one is just like know as a producer that like if you're working with independent artists, ask for splits on the master and register to register them directly with whoever their distributor is. So if it's just your kid, you can register your split directly with DistroKid. If it's their label, uh, it's probably more complicated. But just ask them who they're distributing with, and if you're if you are able to register your split with them. Yeah, yeah. And DistroKid makes it very easy. Shout out to them for sponsoring uh this episode today. Sign up below. You get a big discount if you'd like to distribute your music unlimited for free for pennies. Pennies, people. Damn. Are they getting two ad reads this episode? Uh you know, I guess they just did. Daniel. Daniel, Donald Trump has just appointed you to the brand new position of music industry czar. What is your first order of business? Pay your producer.

Let's go. Can we get a little more before I do the can we get a little more granular specific with that? That was so, like dramatic though. I loved it. Yeah. I just want to get on stage and be like look into the camera like I just did and be like, pay your producer. I love that though. But like more specific. I love how you asked me. you can set law, like you can put in motions and bills and shit. The law is pay your producer. Like you could change, you can make fundamental changes in the industry right now. Yeah. Don't just get on camera and be like, pay your producer. Like it's great, but like what I don't know the answer to it, but like there's there's definitely a way to stream. I don't want to use buzzwords, but I'm sure there's a block. Yeah. Streamline blockchain technology to pay people instantly. You get fucking a hundred streams that gives you three bucks every time. Like, there's definitely a way to do it if if we wanted to do. There's no reason why we can't, bro. There's no reason. So we're implementing blockchain today. Yeah, we did blockchain, bro. I'm bringing it back. It hasn't been mentioned in like a year in the show, probably, but I'm bringing blockchain back. You can do it.

I bring it up every chance I get. Um anyway, we'll move on. When is the right time for a musician to quit their job? Fuck, bro. I the uh something I'm really aspire to be as a friend is somebody that's very optimistic about your future as a person and like seeing the absolute best in you and like what you have potential to do. So I'm not the type of, I'm the worst person to ask that because I don't like to be the antagonist of people's dreams. You'd Be like, no, I don't like to do it now. No, yeah, do it now. Facts. I'm not I don't want to be the thing I will strive the most to be is not the realest parent that's like yo, like though, but how about have you considered this? You could make uh a hundred thousand dollars this year as a recent graduate if you do this. Like, okay, cool. I don't want you know, I don't want to paint that. So I I aspire not to be that, so I have no fucking idea, bro. I'll I'm a yes man. I'm not even gonna lie to you. I'm the type of friend that's like, bro, I'm not gonna tell you the shit that you should realistically be doing. So I'll just be honest. So it's like you have certain friends or something. The thing I'm a good friend for is telling you what you can do that you're not doing. So if I need someone to agree with an idea I have, I'm just going to call Daniel, bro. Oh Yeah, yeah. I'll

be like, yo, do that shit, bro. Yeah. Do that shit. For better or for worse. Uh last one of the short answer. What is your favorite curse word? Shit, bro. I don't know. Shit, bro. It's definitely shit. It's shit. It's definitely shit. Finally. It's definitely shit. Let's go! It's a very passive one. All right, can we stop asking the question? now that you got a shit? No, because I got this from inside the Actors studio. You know what I mean? That was the last question. They would always like this is there's lore behind that last question. Okay. Anyway, moving on to the second section. This is the this or that. I'm gonna give you two choices. You just have to pick one of them. Starting with streaming royalties or physical sales? Uh streaming. Skydive or meditate? Uh skydive. Running ads or influencer campaigns. Uh uh influencer campaigns. Skibidi or Riz? I don't know what that first word is. Riz, I think. But I also don't know the comparison. But Riz is pretty good. I'm sorry. for that one. What did you say? Did you just try to say something? It's a it's

it's just as bad as Riz. They're the they're just they're all bad. I don't know why I said that, honestly. What just happened, bro? We're moving on. Skibidi? Skibbity. Skibbity? Okay, yeah. Skibbity toilet, Ohio, Riz. Anyway, I don't understand the new generation. I'm just repeating what they say. Alina knows she's looking. She's like, yeah, that's what they say. See? Her little sister says skibbity. Boom. Okay, wow. She's already young as fuck. So her little sister is so good. I think it's 13. I'm not making shit up here. You're way too old to be even trying to attempt those words. Isn't that what made it funny though? Okay, moving on. I think major label or independent. Uh major label for me. I don't know if it's stuff that much. Sure, sure. Use AI or don't use AI. Definitely use AI. Singles or projects? Um single market. Yeah, it is. Isn't it? Yeah. I don't know. There's no explanation, so I just gotta say things. Yeah, don't need. There's no questions on it.

There's no explanation needed for these. Ranch or blue cheese. I hate them both, bro. Me too. I don't eat either. Every time I order wings, they asked to say neither. I usually say ranch, though, because sometimes I might just get a lick. Really? Lick and then put that shit down. How wasteful, bro? I know, bro. I just say none. I waste it. Grow up. Honestly. Why is it grow up? Because we're not pussies. Give a wings flavor to them. Last one of the dish for that. Jesus Christ. Become a full-time rapper or leave the music industry forever. Fuck being a rapper, bro. I wouldn't want to live. I would not want to be a rapper, bro. I promise you that. But bro, the fact that you have uh uh one to even ten year period of your life that's your peak, and then everything's downhill from there. Fuck that shit, bro. I want my whole life to be like a constant uphill battle from there. I don't want to be a fucking Damn, the same. that's the reality of it. Nobody's life gets better. I mean, they can't do it. he went from an optimist to a fucking negative Nancy. That's fair. You want to be a rapper?

You're on a timer. The only career dream he's gonna shut down is if his friend comes to him and says, yo, Daniel, I got this great idea. I'm going to Tell him it. though. I want to be a rapper I'm going to tell him I'll think it. And he's like, Don't fucking do it, bro. Hey, some people want that. They want that fucking high. That shit that get that like they were at the top. Yeah. And that's a I'm sure that feels fucking incredible. So would you go into a different type of law? Uh no. Fuck that. I only went into law for music. I wouldn't be in law if it wasn't for music. Lawyers. Yeah. Being a lawyer is trash. Fuck that, bro. I would not want to be a lawyer, bro. So you just open like a candle store, or what are you? What are we doing? I always say I'm I'm striving to open a law firm. I'm not striving to be a lawyer. I'm not I don't want to be a lawyer. I want to do a law firm. It's a businessman. Yeah, yeah. Yeah. I want to build a business that serves people, not practice law. That's the part. Okay, well, the last part is the word association. I'm gonna say one word. You just give me the first word off the top of your head without thinking. You're not judged on your answer. You're only judged on speed. Starting with who's that rampage guy?

Who's that? Archer. You ever seen Archer? Oh no. Great show. Check it out. Music. Oh, first word that comes to mind beat. Burrito. Taco. TikTok. Instagram reels. He's going like, no, not that. This. Yeah. He's going like, stuff. I like it. I like it. I like it. Blizzard. Snow. Contract. Law. Tattoo. Black. Lawyer? Uh dumb. Oh my god. Guy that passed the bar is waiting for his results. Fuck, bro. I hope they don't watch this one. Oh, we're making a clip. Um I'm sending it to the New York Bar Association. right after this. They watch this. I just want you guys to know that like lawyers are. I really just want to help the community, like for them. What a guy. Is this fucking bar application? Bro, it might be.

I'm not joking. It might be on it, what if the best lawyer of all time was a guy that didn't want to really want to be a lawyer? Like I could actually see that. Well, anyway, we'll move on. We'll move on. Let's go with Trumpet. Flute. Ohio. State. Oh shit, bro. That was subconscious. Get the fuck out of here, bro. We'll be winning the national championship in a couple days here. Just to date when we record this. Anyway. Publishing. Royalties. Unicorn. Uh horse. Content. ID. Lil Baby. Producer. Uh royalty. Let's go. This has been Daniel Cruz on Producer Royalty. I was ready. I love it. As always, please like, comment, and subscribe. We are here. Whenever we want. As much as we want to fucking be here. Whenever we get someone as cool as Daniel. Yep, until next time. We're out of here. We're out of here. I've never had a better time.

Yeah. Thank you. I've never had a better time on camera. Podcast today. Podcast deep, bro. Oh, I forgot, bro. This is my fifth podcast. And we just, this was the best. The score, bro. Bro, this is my favorite. I was worried that I would be low energy, but I knew when I saw you guys I would be feeling better. Yeah, we bring out the energy. Yeah, shout out Happy Dad. We'll see y'all next time. Have a great time. That's probably easy. Thanks, Happy Dad.