All other booking agencies generate revenue by taking a commission on every performance scheduled for the artist, which introduces quite a few problems in the relationship between artist and agency. The largest issue created by this structure is that as a result of these agencies only getting paid by means of a commission of the artist’s payout, the artist must already be actively making a generous amount of money for each event that they perform. The industry standard commission rate for a booking agency is between 10-22% of each performance. Even at the median 16% commission, that means that every booking agency must ensure that every artist earns at least 6.25 times as much money as the agency itself needs to earn in order to make their work for that single artist profitable.
The average booking agency represents 207 artists and makes $76,410,000.00 every year. This means that every artist is responsible for over $369,130.00 of the agency’s yearly revenue. At a 16% commission, this means that the average artist represented by a booking agency must make roughly $2,307,065.00 year after year. With most agencies putting a minimum requirement revenue stream of $290,000.00 from each artist in order to represent them, that means that any artist that makes less than $1,812,500.00 each year has close to a 0% chance of getting representation by a booking agent. An agency that makes their money by taking a share of what the artist earns will never work with someone who doesn’t already make almost 10 times what the agent and agency needs to make. Skylight Booking takes monthly payments upfront instead of commissions because it is the only way to ensure that we don’t limit ourselves to only working with artists who are already affluent and largely successful.
It’s important to know that booking performances for smaller artists is uniformly more difficult than booking performances for larger artists. The main reason for this is because music venues are businesses that must make money, and they can’t do that if no one spends money to come see an artist perform. Even on the chance that the venue is able to sell a few tickets, they can’t price them much higher than $10.00–$15.00 a piece, because there is no demand for this artist, which results in the value of admission being very low. This ticket price means that the venue will most likely only make around $150.00 for that night of work. $150.00 that must be used to pay a multitude of their staff, make a profit for their establishment, and in most cases, pay the artist as well.
The inverse of this is booking a larger, more well-known act. When a booking agent contacts a venue requesting a performance of someone who is the caliber of Paul McCartney, then the venue knows that they can price their tickets at around $300.00 a piece, and expect a sold-out show. If this venue has a capacity of 30,000 seats, then they can count on their revenue being at least $9 million for one night. Even with Paul McCartney’s performance guarantee of $6.5 million, the venue has a net profit of $2.5 million for one night of business before they even account for drink sales.
As a result of the uncertainty involved in booking smaller acts, it makes the job significantly more difficult for the booking agent assigned to that artist. Booking agents know that they will do work today that they must wait up to 15 months to get paid for. There is a unanimous habit in these booking agents where they will always favor working for the bigger act today and ignore the smaller act as long as possible. It’s a simple mindset really, if you had the choice to do easier work today that will earn you $250,000.00 next year or to do more difficult work today that will earn you $100.00 next year, which would you choose? There’s no question what the answer is. More pay for less work, always. All this while adding whomever this well-known artist is to your résumé, and the decision becomes even more clear.
That means that they can treat smaller acts with the same respect as larger acts. This also means that, as a result of not being forced to generate revenue on a 10% sliding scale, we can accept smaller acts on our roster. Skylight Booking is structured in this unique way because we are artists first. Artists who want to help other artists. And to help other artists, we had to be structured in the most artist-luxurious format possible. We had to stop the typical thinking that puts the agency first, and start thinking in a way that puts the artist first. There is only one way to break the limits of only working with larger acts, and that is by not taking commissions, and putting all artists on the same level of importance and respect. Skylight Booking is the only officially registered and licensed booking agency to accept small, unknown acts in to our family; and for the first time ever, artists who make less than a 6-figure salary every year have the support of a licensed agency behind them. The only thing better than your music is your music heard by more people.