Updated: Jan 22, 2019
Written By: Austin Hull
Becoming a full time music producer isn't easy. The industry is so saturated; how can you set yourself apart? What can you do to reach your goals? This article discusses ways to diversify your portfolio and breaks down how to increase your income as a music producer.
If you are a beginner in investments, I can promise you that your broker, account manager, or peers are going to tell you "diversify your portfolio." This means don't put all of your money on one stock, or all in bonds, or all in one investment. Diversifying means that you try a bunch of things at the start to see what works for you, what doesn't, what makes money, what loses money, etc. It's a MUCH safer bet when you are just getting started into investing. Sure, once you find what you're good at, what makes you money, and what you enjoy you can focus in one on thing and really become a specialist and a master, but when you're getting started, have as many legs to stand on as you can. Funny enough, I think diversifying your portfolio is the best strategy when you are trying to make a substantial living from production. Let me explain what I mean.
Diversifying means that you try a bunch of things at the start to see what works for you, what doesn't, what makes money, what loses money, etc.
Are you offering services right now for hire? If so, what are you offering? Mixing only? Production only? Design only? If you're an artist are you just selling music and relying on streaming royalties? These are all good ways to make some money, but they are only a select FEW of the many ways. We all know that your income relies on your service, your price, your market, and how well you can attract that market into your services to hire you. If you want to make $50,000 in one year, how will you get there? Let's talk numbers.
Let's start a hypothetical situation to analyze some numbers here. These are not my actual rates, numbers, or income, but this will be a good example to show you a business model that has worked well for me over the past 2 years. My goal is $50,000. If I want to make that based off of mixing only, and I charge $400 for a mix, that means I need to do 125 mixes in a year, or 10-11 every single month. For some this is doable. If you are amazing at mixing and you have this market at your disposal, then by all means go for it.
If I want to make my $50,000 from production only, and I charge $1000 a song, then I need to do 50 tracks in a year, or 4-5 every single month.
If I want to make $50,000 from writing, and I charge $300 per song, then I need 167 projects a year, or 13-14 a month.
You get the point by now. If I wanted to make $50,000 all from one area, I would need a shit-load of clients in each of those areas. It can definitely work for people who have good access to those markets, have strong return rates on clients, and are constantly putting out quality content to attract more people. After a while of trying different things you will start to find your niche and be able to really focus and specialize in one area and CRUSH it, but I'm willing to guess most of you reading this are not in that bracket yet. You're probably making some cash, making some good quality products for your clients, but are wondering "how the fuck do I scale this?" Am I right? I thought the same thing until I realized one thing. It is so much easier to get a couple clients for production here and there, and a couple for mixing here and there, and a couple for writing here and there, etc. Now let's talk about my business model that works for me. Again, these aren't my actual numbers, but I want to break it down in a similar fashion to how I break down my income every month. Here is what I look at:
What services do I offer / Income Streams: Production, Writing, Mixing, Sample Packs, Logos
What percentage do I want to do in each of those? 40% production, 20% writing, 20% mixing, 10 % sample sales, 10% logos.
Now how much of each do I need to do in a month to make $50,000 a year? I need to make right around $4,200 a month to hit $50,000 in a year.
Production (40% of my time and income) - I need to make $1,680 a month from production. If I charge $850 per production then I only need TWO clients every month.
Writing (20% of my time and income) - I need $840 a month from writing. If I write for $300 a song, I only need 3 clients a month.
Mixing (20% of my time and income) - I need $840 a month from mixing. If I mix for $300 a song, then I need 3 mixing clients per month.
Samples (10% of my time and income) - I need $420 a month from sample sales. If I sell a pack every month for $25, then I only need 17 sales. 17 SALES. ARE YOU KIDDING?
Logos (10% of my time and income) - I need $420 a month from logos. If I charge $200 per logo, this means I only need to do 2 logos a month.
Bam, a $50,000 year lined up. Instead of needing 50 productions, or a couple hundred mixes, or whatever, let's see what I need. I need 2 productions, 3 top-lines, 3 mixes, 17 sample pack sales, and 2 logos in a month. It is MUCH easier to find this small number of clients in each field. Of course, you need to have great quality work, fair rates, and great content to attract the potential clients to your services. But if you are doing all 3 of those at the moment and you feel stuck because you can only get a couple productions a month, or a couple mixes a month, and you are relying on that one specific service to pay your bills, think about diversifying to expand your clientele. Also, side note, if you offer a lot of these services, you can normally bring artists in for package deals and really rack up the dough. $50,000 seems much more manageable when you can break it into these small micro goals. Do me a favor, every month look at your numbers. Where did your money come from? What service did you get booked for? What percentage of your clients came in for what? Do a time / income analysis. Is something taking a ton of time that isn't pulling in money? Maybe put your time into an area where you could be making your money back on that time. Break your month into micro goals for your services so you can easily keep track of it. See if it helps you stay on par for the month. If you are good at what you do, you network and put out content to get your name out there, and you handle business accordingly, there is no reason you shouldn't be able to bring in $50,000 a year.