The Awful Truth: Royalty Shizzle

A buddy called me out yesterday about a recent blog post of mine.

He says I exaggerate.

He says there is no way that Guardian is in the hole with Warner Bros. for $200k.

I can be guilty of exaggeration. I have an excitable personality and it just comes with the turf.

I received some royalty statements yesterday.

My buddy was right. Our recoupable account is not $200k.

It’s actually $174,073.84 to be exact.

What’s interesting about this is…that we have been averaging annual gross royalties of about $1,000 a year.

Which means—at this rate—we’ll be recouped in about 174 years.

Royalties and Record Deals are the stuff of folklore. They are one of the most misunderstood aspects of the record business. Let me give you some real-life scenarios based on my career with Guardian.

We signed our first record deal with Enigma Records in September of 1985. This was an early incarnation of the band—pre-Tony, Jamie and Karl.

Stryper had just really broken as a national act for Enigma. A buddy of ours, Eric Blair worked on the Stryper crew. On one road trip, the president of Enigma Records, Wes Hein, accompanied the band on the bus. Our friend Eric, who has a very intense personality (nowadays he has a cool entertainment show called The Blairing Out Show), cornered Wes and made him listen to our little demo tape.

Long story short—Wes liked our tape enough to drive down to our little rehearsal shed in Santa Ana, CA and offer us a record deal.

We were somewhat flabbergasted. At that time, we were a progressive metal power trio called Fusion. It was Paul Cawley, Rikk Hart and myself. (Paul and Rikk are on Guardian’s first national release “First Watch” but left the band in 1990.)

Our sound was remarkably different then compared to the sound Guardian is primarily known for. We called it Space Metal.

Paul played guitar and sang. I played bass and synthesizers ala Geddy Lee, and Rikk did his best Neil Peart on one of the oversized drum kits of the day.

In truth, we were really a not-so-great attempt at Rush meets Van Halen.

On top of all that, we wore motocross gear that had been modified into “The Full Armor of God”.

In retrospect, I think Wes must have liked our cheesy theatrical space metal vibe.

Some Enigma employees told me years later that they heard that Wes signed us with the intent to “shelf” us as to limit Stryper’s competition

“Shelving” is an old-school record industry tactic of tying up a band legally through a record contract to take them off the market.

I’ll never really know if this was true or not.

One thing I do know is that when Wes offered us a record deal—we were really not that great of a band. The first thing that Wes told us to do was to add a second guitar player and change our name.

Enter David Caro and the new name…Gardian.

Yeah, we could spell…but Gardian had 7 letters and that numerology seemed to work for Stryper so we misspelled our way into a real record contract.

In retrospect, a pretty terrible record contract at that.

They kept all of our publishing rights and everything was cross-collateralized…which meant that any monies they could have possibly owed us for recording or publishing royalties could be offset by nearly any and money spent on us.

But Wes did sweeten the deal with a signing bonus.

A brand new Yamaha DX7 synthesizer!

I don’t know how much you know about synths but the DX7 was big new technology back then.

Nowadays, these keyboards are pretty much extinct.

So…the big question…Do I feel like we got hosed on our first record deal?

No—and here’s why.

1. The odds of a band like us getting signed were probably a 1000 to 1 back in the mid 80’s.
2. Later that same year, Enigma cut a deal with Capitol Records and received the resultant status upgrade—which came in handy for a young band on the tough L.A. metal circuit.
3. It was a HUGE shot of encouragement to us. Every band needs that glimmer of hope—the proverbial carrot-on-a-stick to keep them going. We probably would have broken up without this deal.

As far as the shelving theory—it is true that we were in “development” for nearly 4 years. Our debut album was not released until June of 1989.

But I don’t buy the shelving theory. Wes paid for us to cut demos over those years and did a lot to push us forward—including introducing us to real managers etc. And when it came time to really start touring, Wes gave us the money to buy our first van & trailer.

The truth is that we were simply not ready back in 1985. We had potential but were still green as the hills.

I saw Wes Hein about five years ago in Nashville when I was a big shot VP of A&R for EMI. He and his wife (who he met at Enigma) came and visited me in my swank executive suite. I even took them to lunch—which was quite a switch from my days as a starving musician back in 1985.

Wes told me that he was proud of me.

And I thanked him for signing that silly little space metal band from Orange County all those years ago.

I will always be grateful to Wes for that crummy record deal.

The moral of the story is…ya gotta start somewhere.

Everyone has to pay their dues. It’s unavoidable in business. The secret is to learn as much as you can during the journey.

Hopefully, you will have made enough progress to get a better deal next time around.

We did.

Enter the Elefante’s and Pakaderm Records…

To be continued.

Comments

[Phil Madeira]

Dave, You need to start dressing in motocross again.

[Wesley]

While I emailed David directly with a response I thought it proper to also respond via comment since readers might be interested in my perspective.

First and most importantly, I certainly did NOT sign Gardian as a defensive move. I can't even imagine who said or thought that. 1) I would never do it. 2) We didn't have the money to spend on non-productive uses like that; and most importantly 3) I loved their demo. I was a big progressive rock fan and still listen to old German prog rock space music. Netkar was one of my all time favorite bands. When I heard that first track on the original Gardian demo it was something I hadn't heard an American band sound like in a very long time and I was convinced it could stand out. I didn't care about the uniforms and figured you knew your audience better than me. I had forgotten about the name issue but must have figured that your original name of "Fusion" might give people the impression you were a jazz band. I knew from experience how lazy record store clerks could be and a mis-filed album is a returned album 90 days later.

That's why I signed Gardian and not any other reason. As David knows, being the successful A&R person he was, there are 100's of reasons to not sign a band but only one to sign one. We made a lot of mistakes over the years but I can tell you at some point during every signing we were convinced the band we were signing would sell enough to justify the signing.

[David Bach]

Wesley,

Thanks for your comment. It's what I've always believed. A lot of my blogging comes from recollection in the hopes that I can offer good advice to aspiring bands/artists. Without rehashing the past too much, Guardian's relationship with Enigma was almost textbook of many artist/label relationships that I witnessed in my label days. It's what I call "Middle Management Purgatory". In Guardian's case, you, the president, had signed us—we entered the system "top-down". Where things got interesting is when we actually exited "development" and entered official "roster-dom" and thus upon the desks of the hard-working label staff. One could almost sense a parting of the waters as to which of those on the staff “bought in” to our band and those who did not. Those were interesting days. Christian rock was decidedly uncool and I think we were always hypersensitive to being accepted due to faith issues. A mistake we may have made was getting too chummy with some of the label staff that liked us and shunning those who seemed not to. The takeaway lesson for me was something I experienced countless times during my years with EMI and BMG: Mid-level management buy-in can never be mandated. Top-down priorities can be pushed through but if the artist (or product rep) takes the time to develop relationships with those sometimes deemed "less-important"—the resultant buy-in and in-house evangelism can be huge. In retrospect in my artist career, I wish I had had reached out more to those who were not yet believers in us rather than focusing on those already "converted”.

[Jon Hiller]

Hey, I still have a DX7ii..... haha. I'm still laughing at Phil Madeira's comment as well! Man, Dave, it's cool to find your blog, I haven't talked to you in a long time, probably since bringing Guardian into Marion, IL, or maybe the NAMM show you guys played at the CGM speaker booth.... hope you're doing well!