Ready to apply for your first royalty advance? Read this post. Below are tips to ensure you are completely prepared. Trust me, being prepared will make the process a breeze.
First Advance Checklist
Have your current earnings in front of you – There is no doubt that the first question any company will ask you is: “What are your earnings?” Having this information will allow you to give the most accurate information and in return, receive the most accurate offer.
Know where your earnings are coming from – Do you have multiple sources of revenue (PROs, distributor, publishing, streaming/sales, SoundExchange)? You will want to share where your earnings are coming from because some finance companies may not be able to advance earnings from all sources.
Review the application process – No one is just going to give you money without a bit of work on your end. I encourage you to review the application and processes of multiple companies. Things to take into consideration:
What documents do you need to submit with the application?
How long will the application process take?
What does the approval process look like? Is there a timeline for approval?
Compare multiple offers – You wouldn’t make a major purchase without price comparison, so why wouldn’t you want to perform the same due-diligence when taking an advance? As we’ve discussed in previous blogs (Don’t Make These 4 Mistakes), not all advances are created equal. You have to compare your offers to determine the following:
What is your TOTAL payback? How much will the advance actually cost you?
How much are the fees? Do you have to pay interest?
How long will it take you to payback your advance?
Will you still maintain the rights to your music while you owe? **Reminder: You NEVER want to give up any of your rights!
Be realistic in your expectations – You have to be honest with yourself. Are you making $20,000 per year from music? You will not get an offer for a $1,000,000 advance. If you do, run for the hills because that is not a legitimate offer/company. It would be irresponsible for anyone to offer you more than you can payback in a reasonable amount of time (1 -2 years, at most).
As for Lyric Financial, we believe in making the application process as easy as possible. We offer an online application. From there, a member of our team will review your earnings and streams of income to build you an offer. Throughout the entire process, we pride ourselves on being as transparent as possible. We will show you how much your total payback will be, unfortunately most companies do not want to do that. If you have questions, we are always more than happy to answer them.