How to start a record label: structure, distribution, royalties and a simple business plan

How to start a record label: the short answer

If you want to know how to start a record label, the honest answer is that the paperwork is the easy part. You need a business, a name nobody else owns, a way to get music onto Spotify, Apple Music and YouTube, the right registrations so royalties reach you, and written agreements with every artist and producer. All of that can be done in a few weeks.

The hard part is the same as it has always been: putting out records people hear. So this guide covers the set-up step by step, then the record label business plan, the budget for a first release and how to market it. It is written for an artist, producer or manager starting a small independent record label in the US or the UK. Every fee and rule below comes from the official or company page linked, read on 5 October 2026. None of it is legal or tax advice.

Decide what the label is for

Most small labels start as one of two things, and the choice changes almost everything that follows.

• A home for your own releases. You put out your own music, or your band's, under a label name. You own the recordings, there is no one else to pay, and the contracts are mostly with producers, featured artists and collaborators. This is the simplest version and a good place to start.
• A label that signs other artists. You find artists, pay for or help with recording, release their music and share the income. Now you need proper artist agreements, accounting statements, a release schedule for more than one act and enough money to back several releases at once.

Write down a sentence on what the label stands for: a genre, a city, a scene or a sound. It helps you say no to artists who don't fit, and it gives press, curators and fans a reason to follow the label rather than one song.

Set up the business and check the name

In the US, the SBA's guide to business structures sets out the options. As a sole proprietor you can be held personally liable for the business's debts; LLC and corporation owners generally are not. The IRS says you never have to pay a fee for an Employer Identification Number (EIN) and can get one online in minutes; it warns against websites that charge for one.

In the UK, GOV.UK's set-up guide describes sole traders, limited companies and partnerships, and notes that a limited company is legally separate from the people who own it. Registering a limited company with Companies House costs £100 online, usually within 24 hours, or £124 by post. If you start as a sole trader, you can use a trading name, and you must register for Self Assessment once you earn more than £1,000 in a tax year.

Which structure suits you depends on your income, your risk and where you live, so speak to an accountant before you choose. It is usually easier to move from sole trader to limited company later than the other way round, as GOV.UK points out.

Check the name before you print it on anything. Search the official databases: the US Trademark Search system from the USPTO, and the UK IPO's trade mark search. The SBA notes that registering a DBA (a trade name) gives no legal protection by itself, while a federal trademark does. In the UK, registering a trade mark costs at least £205 and usually takes three to four months. Check the domain name and social handles at the same time, and search Spotify for other labels or artists using the name.

Distribution, ISRCs, UPCs and metadata

A small label reaches Spotify, Apple Music, YouTube Music and the rest through a distributor. You upload the audio, artwork and details once, and the distributor delivers them to each service and collects the money. Spotify's royalties page says recording royalties are paid to artists through the licensor that delivered the music, typically their record label or distributor.

Look for a plan that lets you release under your own label name and manage more than one artist. Two examples, from their own pricing pages:

• DistroKid lists Musician Plus at $44.99 a year for two artists, with "Customize label name", and Ultimate at $89.99 a year for 1 to 100 artists. It says you keep 100% of earnings.
• TuneCore lists a Professional plan at $54.99 a year that includes "Manage Multiple Artists", "Custom Label Name" and the option to use your own ISRCs and UPCs.

Other distributors work on a commission or by invitation. Compare what you keep, how many artists a plan covers, how payments are split between collaborators and how easily you can move your catalogue later.

ISRCs identify a recording, not a song. TuneCore's ISRC guide says it assigns one during upload and that the code is permanent. If you want codes under your label's own prefix: in the US, the US ISRC Agency charges a one-time $95 fee for a Rights Owner Prefix, with no further costs; in the UK, PPL issues ISRCs when you join as a recording rightsholder, or through an "ISRC only" registration.

UPCs identify the release (the single, EP or album). Distributors usually generate one, and if you want your own for physical products, GS1 US sells a single GTIN for $30 with no annual fee, or a company prefix for 10 items at $250 plus $50 a year.

Metadata is where small labels lose money. Keep a spreadsheet for every track: the exact artist name as it appears on streaming services, featured artists, songwriters and their shares, producers, ISRC, UPC, release date, label name, the copyright lines and the explicit flag. Use the same spelling everywhere, every time.

Register to collect royalties: SoundExchange, PPL and the PROs

Every song has two copyrights: the recording (the master, which a label usually owns or licenses) and the composition (the song, owned by its writers and publishers). They are paid by different organisations.

• SoundExchange (US, recordings). SoundExchange says recording artists and sound recording owners must be registered to receive digital performance royalties from non-interactive services such as SiriusXM, Pandora and iHeartRadio, and that registering is free. Register the label as rights owner and make sure each featured artist registers too.
• PPL (UK, recordings). PPL collects when recorded music is broadcast or played in public in the UK. It is free to join, for performers and for anyone who owns or exclusively licenses the rights to recorded music.
• Performing rights organisations (compositions). Songwriters on your roster should join a PRO: in the US, ASCAP, BMI or another society; in the UK, PRS for Music, which charges writers a one-off £100 for lifetime membership. If your label also runs a publishing arm, it registers as a publisher. Check each society's current terms on its own site before you apply.

One rule matters for every release plan: Spotify only pays recorded-music royalties on tracks with at least 1,000 streams in the previous 12 months, plus a minimum number of unique listeners it does not publish. Our streaming royalties calculator gives a rough idea of what streams pay.

Contracts and splits: get it in writing

Even when the artist is your best friend, write the deal down. At a high level, a small label agreement should answer:

• Who owns the masters, and for how long. In a licence deal the artist keeps ownership and the label has rights for a set term; in a traditional record deal the label owns them.
• How income is split, and whether costs (recording, artwork, ads) are paid back first.
• What the label will actually do: how many releases, what marketing, what budget.
• Territory and term, plus how and how often the artist gets statements.
• Splits with producers, featured artists and co-writers, agreed before release, not after.

Templates found online are a starting point for questions, not a finished contract. Pay a music lawyer in your country to draft or review your first artist agreement and use it as your standard. It costs far less than unpicking a dispute over a song that has started to earn.

What goes in a record label business plan

A record label business plan does not need to be long. Two or three pages that you update every quarter is enough for a small label, and it is what a bank, an investor or a distributor offering advances will want to see. Cover these points:

1. What the label is: the sound or scene, who it serves and why it exists.
2. Roster: the artists, what each has released, their audience today and the plan for each.
3. Release schedule: the next 12 months, release by release, with dates set far enough ahead for pitching and press.
4. Budget per release: recording, mixing and mastering, artwork, video, distribution and marketing, line by line.
5. Revenue streams: streaming and downloads through your distributor, SoundExchange and PPL income, YouTube, physical sales and merch, sync licensing, and any share of live income your deals include.
6. Costs and cash flow: fixed costs (distribution, software, accounting) and when money actually arrives, which is usually months after a release.
7. Targets: listeners, followers, email sign-ups and income per release, so you can tell what worked.

As for how to grow a record label: release regularly, keep a recognisable sound, sign slowly, and put early income back into the artists who are already finding listeners. Each release adds to the catalogue, and a catalogue keeps earning while you work on the next one.

Budgeting and marketing every release

The set-up costs are known and small. Production and marketing are the costs you control, so get written quotes for those before you set a date. Here is what the one-off set-up costs, from the pages cited above:

Marketing is where new labels most often run out of money, because the budget went into the recording. A release nobody hears earns nothing, and on Spotify a track under 1,000 streams a year earns nothing at all. So give every release its own marketing line in the budget, set before the release date, and treat it as part of the cost of making the record.

What each release needs. The same short list, for every artist on the roster:

• An EPK: bio, photos, links, contact. Our free EPK template and the guide to an EPK for musicians cover what goes in it. Make one per artist and update it each release.
• A press release for each single or record, sent with the EPK to blogs, radio and local press. Start from our music press release template.
• A YouTube campaign for the music video, run through Google Ads to people who watch similar artists. Our YouTube promotion cost calculator estimates what a budget buys in different countries.
• Press coverage that comes up when promoters, curators and fans search the artist's name. See how much music PR costs for typical fees.
• Short clips cut from the video for Shorts, TikTok and Reels, posted by the artist and the label.

What to keep in-house and what to outsource. Keep the things only the label can do: choosing what to release and when, the release schedule, metadata, the relationship with each artist and the label's own channels. Outsource the specialist work you would otherwise learn on your artists' releases: mixing and mastering, artwork, video, contracts, accounts, and usually the ad campaigns and press. Paying a fixed price per campaign keeps the cost of each release predictable, which makes the budget in your business plan real.

Run it the same way for every artist. A small label's advantage is repetition. Give each release the same campaign, a YouTube push for the video plus a piece of press, and compare the reports side by side: cost per view, watch time and top countries. After three or four releases you will know which artists, songs and countries deserve more money, and you can move budget there instead of guessing.

Our week-by-week plan on how to promote your music puts all this in order, from Spotify pitching to release week. Whatever you spend, never pay for streams, views or guaranteed playlist spots: the platforms ban it, and our guide to legit music promotion explains how to spot it.

Where Blue Leopard Media fits

If you run a label, this is the part we do. We don't start labels, set up distribution or handle contracts: a distributor, an accountant and a music lawyer cover those. Through our music marketing service, we market releases for every artist on your label, campaign by campaign, at a fixed price per campaign from $249. You pay for the campaign, nothing else: we take no rights in your music and no share of your royalties.

Each campaign is the release-marketing plan above, done for you:

• A worldwide YouTube campaign: we run the artist's music video as a Google Ads campaign, as skippable ads before other videos and in search and the home feed, aimed at people who watch similar artists. No bots, no view farms, no bought likes or subscribers.
• An editorial feature about the artist, their music and the release, written by our editorial team with the artist's name in the headline and their own digital cover, on one of the publications we work with. You approve every word, and it goes live within 24 hours of your approval of the final draft. It is sponsored content and labelled as such, as our disclaimer explains.
• A weekly Google Ads report with views, cost and watch time, so you can compare releases across your roster and decide where the next budget goes.
• Price: a YouTube campaign plus one editorial feature from $249 per release. Targeting specific countries or cities is priced separately. For an album or a campaign across several artists, you get a written plan with the scope and the fee before anything starts.
• If Google won't approve the video: we tell you why and what edit would fix it, and our refund policy covers a full refund if it is still not approved.
• Not guaranteed: streams, playlist placements, chart positions or any view count. Nobody honest can promise those.

One to two weeks before release day is the ideal time to start, though we can help with a release that is already out. If your label has a release coming up, book a free 15-minute call about how we would run it. There is no obligation to buy anything.