In January of 2013, A$AP Ferg signed a solo record deal with Polo Grounds Music and RCA, following in the footsteps of A$AP Mob and their ringleader Rocky. Over the past three and a half years, he has released two full-length albums and one Gold-certified single ("New Level"), but according to the Harlem native, his decision to sign to a major was never about just finding the right home to release his music.
In a new feature at Pigeons & Planes entitled Why Sign With a Label in 2016? Ferg explains that advance money, above all else, was his biggest motivation.
"It can be a positive because some people really need the money. It’ll help out around the house, or whatever the case may be. It’ll help their living condition. That’s the blessing about a deal. You get some advance money to take you out of your situation. You move out of the hood. Help your mother out. Whatever you gotta do with the money."
Ferg's explanation makes sense. Signing a record deal with a major label who is offering a hefty advance—a sum of money that is paid to the artist on account of future royalties—is an attractive situation. But what most artists don't understand is that an advance is not free money. Nor is it a signing bonus. Advance money must be paid back to the label through profits generated by album and single sales.
This is all fine and dandy if you're an artist that the label decides to prioritize and push to the masses. However, if you get placed on the label's back burner—a scenario Ferg likely didn't even consider based on his relationship to Rocky—and you want to request a release from your record contract, expect the label to demand that every cent of their original advance payment is paid back in full.
"I look at the record label as a music bank. You can go and get a little bit of money from them," Ferg later explained to P&P.
Yes, Ferg, labels are like banks... in that, they are in business to make money. And much like a bank will hand out a loan with interest payments attached, record labels expect a return on their investment in the form of royalty recoupments.
Signing to a record label out of financial desperation, much like any money-motivated decision, is always a risk. To mitigate this risk it's best to hire a trustworthy team (lawyers, manager, accountant) to make sure that, while your bills might get paid today, you also have financial security tomorrow and the day after. You know, the type of security that will really help out moms.