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The Power Pyramid in Music - Promoters, Agents & Labels

It's a funny business.
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The music industry is in a constant state of change these days, not only for consumers but for artists themselves. Also changing are the relationships artists have with traditional power-holders, namely the power pyramid—consisting of the promoter, the agent and the record label. 

If you're an artist looking to lead a successful career in music, you must understand when and why you might—or might not—need to enlist the help of the three, to not only maximize earning potential but keep ahead of the game in a rapidly evolving industry.

1. The Promoter

The most powerful entity in the music business. Because they write the checks. And on the road is where you make the most money. Unheralded and unknown, especially by the press, the labels get all the glory, but it's the promoters that keep the business healthy. Anybody can get their music on streaming services, not anybody can get a gig and get paid for it.

Sure, there are open buildings, but have you got the money to guarantee rent, the ability to advertise and get people to come to the show? The promoter does all this for little upside. The promoter takes all the risk and you reap the glory. Of course the more unknown you are the worse deal you get. But if you can deliver, your splits improve.

2. The Agent

Of course, you need a manager, but you also need an agent, otherwise you're just sitting on the couch fantasizing. There's a lot of talk and little action with developing acts. How can you get an agent interested? Not so much by demonstrating that you're good, but by showing that you can draw an audience. You can sit at home concocting songs but if you want to get ahead you're better off honing your live show. Take every opportunity available, even for free at first. Not only do you want to expose people, you want to get better. No one gets good at a job until they actually do it. Not only do you have to perform the songs on stage, you have to engage the audience, which is harder than it looks.

Now the funny thing about today's music business is agents find you, as do record labels. Nothing's hidden, everything's available, and if you can garner a live audience, if you can sell tickets, an agent will probably show up. Not that you cannot pitch yourself, but dragging an agent to a gig is only part of the problem, then you've got to deliver on stage and demonstrate you can build an audience. Sure, agents are interested in socials, but they're more interested in ticket sales. This is where the rubber meets the road, where it can't be faked.

Big agents will probably not be interested at first. Sign with a small one if necessary. But know that agency relationships, unlike record deals, are fluid. You can move on with little obligation. The law varies from state to state, but this is the essence.

The irony is if you become a superstar in most cases you no longer need an agent, you can negotiate directly with the promoter, but agents don't want to tell you this, they want to prove their necessity, as the agency they work for gets into other businesses and their importance wanes.

3. The Record Label

You don't need one unless you plan to get on the radio. And I'm talking Top 40 or Urban radio. Otherwise, the label can't do much for you and will take all the action in the process. The goal used to be to get a record deal, today you want to play live, where all the money is anyway.

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If you play music that can get in the Spotify Top 50, a major will be helpful. As for indies, you can tell your mother you got a deal but there will be little cash and no radio and they probably won't do much other than send out press kits and they'll take all the money if there is any. You want to do it yourself until you get traction.

It's a funny business, everybody's trumpeting their relationships when all the statistic insiders care about is money. How much money is involved? How much are you making? Labels can delay your career and hold you up when things are not going well and it's more akin to the movie business than the music business of yore. The labels make big investments, they roll the dice on that which they believe will go nuclear. And, as you know, almost nobody does. Do you want to be tied up and play these odds?

So it comes down to you. Used to be it was about aligning yourself with the players because the barrier to entry was so high. Now the barrier to entry is nonexistent. You can make the music at home on your computer for bupkes, you can distribute it on streaming services for nearly nothing, but the hardest part is getting people to pay attention. And that's your job.

Don't put the cart before the horse, don't try to gain attention before you deserve it. Because that just makes it harder to get people to give a look when you deserve it down the line.

Your only hope is to empower the public. Press reaches fewer people than ever before. The papers review albums that go straight to the dumper. You're on your own, and that's a good thing. Because you can experiment, you can pivot, you can be in the game all the time. Used to be when recording was expensive and labels paid for it, they dribbled out albums that they micro-managed, because of the risk involved. Now you can write a new song and put it on streaming services immediately, put a cover on YouTube, build a following with a Snapchat Story...

The only problem is now the competition is everybody. Used to be if you jumped the hurdle and got a deal, that eliminated most of the competition, you were a member of the club, chances are word could be spread about you and you might be able to trade on it for the rest of your life. No longer. This mimics the world at large. Where the rich get richer and the poor get flat screens and the underclass believes it can make it on hopes and dreams but ultimately becomes disillusioned. Music is the land of wannabe hype. Everybody's spamming ad infinitum.

How do you break through the clutter? With tunes and performance, and those are the hardest things. And even if you're great, it takes longer to make it today. So look for a spark, look for an increase in metrics, and if you don't get it, change what you're doing or give up. And there's no dishonor in giving up. It's fun to play music but not everyone can do it for a living. And if you want to become famous, there are much better ways than playing music, especially in this internet era. And if you want to become rich, being a musician is kind of like...being a lawyer—a profession that once put you ahead of the pack with a guaranteed income but no longer does. Sure, there are some lawyers making bank, but many graduates can't even get a legal job.

Find your niche in life. If it's gonna be music, focus on your skills and try to do something different and know it's a long hard slog. Furthermore, you can be uber-talented and not make it. And sour grapes dooms you. Overnight success is rare and rarely lasts. Think building blocks. And the best way to have a sustained career is to play live, garner an audience and move up the performance food chain.


By Bob Lefsetz. Reprinted with permission from The Lefsetz Letter, subscribe via



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