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Author Topic: How did the BB’s make money in the 60’s?  (Read 3616 times)
Needleinthehay
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« on: February 22, 2018, 02:44:37 AM »

I read in Mike’s book along with some other places that their record deal with Capitol gave them a royalty rate of 2.5% of the wholesale cost per record sold. If average sale price was, say, 1 dollar then each guy in the band got around half a cent/record sold.
If they sold 1 million records thats 5k per person.
Granted, someone like Brian made all of his money in publishing/songwriting royalties, but how was someone, like Al who had limited songwriting credits make all his money in the 60s? I know they also toured extensively but from what i understand back then touring wasnt the main money maker like it is now.

Tl;dr 2.5% royalty rate to split between them seems impossibly low, what income streams back in the 60s genetated money that i’m not aware of? Or WAS the 2.5% really the main way they made money?
« Last Edit: February 22, 2018, 02:50:03 AM by Needleinthehay » Logged
leoleoleoleo
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« Reply #1 on: February 22, 2018, 03:04:25 AM »

I believe the record company would have given the band an advance payment upon signing them. This would presumably be split between the members and be enough to live off. The advance would be recouped through royalties generated by record sales and the licensing of any other band related products. Once the company has made back its money, then the band become 'payable' and that's when they start getting royalty payments. Once the contract runs out (they're usually limited to a fixed number of albums), if the band are doing well, the contract will be renewed and another, larger, advance would have been paid to the band and the royalty rates amended to be more favourable. That, at least, is more or less how record companies work today. The 60's were far shadier and more exploitative times for recording artists so who knows what kind of skullduggery was going on! But that should explain at least why even Al could afford a nice house etc.
« Last Edit: February 22, 2018, 03:13:56 AM by leoleoleoleo » Logged
SBonilla
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« Reply #2 on: February 22, 2018, 05:43:40 AM »

The money a record company advances to an artist is used for the recording budget (studio, producer, hired talent and all related costs), from there, leftover funds go to the manager (back then it would have been between 10% and 15%), then to the artist. And, of course, all of that money would have been recoupable.

New signings rarely got advances where there was enough to live off. Often new artists would spend leftover funds on touring equipment. And when it came time to tour, there were often budget shortfalls. That was where 'tour support' from the record company came in. Tour support is a recoupable advance. Many artists were indebted to the record company from the get-go.
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Stephen W. Desper
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« Reply #3 on: February 23, 2018, 02:23:05 PM »

COMMENT:  They didn't make money. The BB organization was running a huge deficit during the 60's. They owed everyone -- even me. They had a terrible reputation among studios and hotels before it was turned around. They borrowed against future royalties, ran up bills and didn't pay, booked rooms and hotel bills that stayed in accounts payable for a long time. Brian loaned the band from his income. It was Grillo's fiduciary juggling act that kept everything functioning. But still some studios refused to book them and promoters found it hard to house them on tour due to the poor reputation for paying bills that preceded any visit. Studio Instruments put a limit on their account as did some credit card companies. A lot of this was due to their extravagant life-styles and living beyond their means that never reflected the down-turn in total record sales.

But eventually things got better . . . it's just that some people had to wait quite a while for their money.
  ~swd
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SMiLE Brian
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« Reply #4 on: February 23, 2018, 02:27:11 PM »

Damn, that might be a previously unknown reason for their downturn and BW’s anger at the BBS pushing him  in the 1970s.
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And production aside, I’d so much rather hear a 14 year old David Marks shred some guitar on Chug-a-lug than hear a 51 year old Mike Love sing about bangin some chick in a swimming pool.-rab2591
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« Reply #5 on: February 23, 2018, 02:44:35 PM »

COMMENT:  They didn't make money. The BB organization was running a huge deficit during the 60's. They owed everyone -- even me. They had a terrible reputation among studios and hotels before it was turned around. They borrowed against future royalties, ran up bills and didn't pay, booked rooms and hotel bills that stayed in accounts payable for a long time. Brian loaned the band from his income. It was Grillo's fiduciary juggling act that kept everything functioning. But still some studios refused to book them and promoters found it hard to house them on tour due to the poor reputation for paying bills that preceded any visit. Studio Instruments put a limit on their account as did some credit card companies. A lot of this was due to their extravagant life-styles and living beyond their means that never reflected the down-turn in total record sales.

But eventually things got better . . . it's just that some people had to wait quite a while for their money.
  ~swd

Wow, interesting. As a working class/poor person, I couldn't even imagine what it would be like to live rather lavishly but be in substantial debt. I'm in a small amount of debt (a couple of grand), but I live on bread and peanut butter to pay it, given my wages are so low.

Sounds like they must have at least treated their accountant well!
« Last Edit: February 23, 2018, 02:48:12 PM by Gabo » Logged
Stephen W. Desper
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« Reply #6 on: February 23, 2018, 03:40:57 PM »

COMMENT:  They didn't make money. The BB organization was running a huge deficit during the 60's. They owed everyone -- even me. They had a terrible reputation among studios and hotels before it was turned around. They borrowed against future royalties, ran up bills and didn't pay, booked rooms and hotel bills that stayed in accounts payable for a long time. Brian loaned the band from his income. It was Grillo's fiduciary juggling act that kept everything functioning. But still some studios refused to book them and promoters found it hard to house them on tour due to the poor reputation for paying bills that preceded any visit. Studio Instruments put a limit on their account as did some credit card companies. A lot of this was due to their extravagant life-styles and living beyond their means that never reflected the down-turn in total record sales.

But eventually things got better . . . it's just that some people had to wait quite a while for their money.
  ~swd

Wow, interesting. As a working class/poor person, I couldn't even imagine what it would be like to live rather lavishly but be in substantial debt. I'm in a small amount of debt (a couple of grand), but I live on bread and peanut butter to pay it, given my wages are so low.

Sounds like they must have at least treated their accountant well!

COMMENT to Gabo:

Well that's typical for the upper class. They don't stop spending, they just increase their debt level. Even Trump is no stranger to that style of living ... float when you must, then work hard and re-fill the coffers.  I've been broke twice in my life, but you just keep going and eventually things turn around. As far as treating their accountant (Nick Grillo) of the time, well -- he sued them for 1.5 million and won. You should read up on the history of the band.  But you see, when you're a major band with name recognition all over the world you can slide around on your reputation for quite some time. Eventually it caught up with the Beach Boys -- but remember, those royalties just keep coming. And also remember that they have investments too -- not related to the music business -- like land, stocks, and commodities.
~swd
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guitarfool2002
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« Reply #7 on: February 23, 2018, 04:26:17 PM »

Thank you Stephen for sharing the information, once again your insight and experiences are invaluable and appreciated!

If I could add to your previous posts, there were accounts published in the Stephen Gaines book that were pretty specific regarding Nick Grillo and how he was dealt with by the band. I'd also encourage fans who may not be familiar with that part of the story to read up on that, and see if opinions on certain things change after hearing another side of the story. For one, Nick was involved in, as Stephen said, investments which would be normal course of action in terms of diversifying their income sources and also making (and saving) potentially boatloads of money. Those included land deals.

Grillo came out of it unceremoniously fired and accused of being a crook or a thief. He was vindicated and cleared. He was not a thief.

Get the common threads moving a few years later into the 70's and early 80's, and another manager, Mike's own brother no less, did similar things with investments in property. One specific deal, had the P.T.B. in the band at the time followed the advice, could have netted them millions in profit. Instead they balked.

Mike's brother came out of it unceremoniously fired and accused of being a crook or thief. He was vindicated and cleared. A court appeal found he was not a thief.

In both cases the band lost millions in potential revenue, and a manager got the brunt of the blame up to being accused of theft or malfeasance, only to have both cleared by the legal system.

I only bring that up to suggest it was nothing new in the world of the Beach Boys and finance combined with management.

And I have also heard, beyond what Stephen wrote above and what was reported in the book, how Brian would dip into his own pocket to pay the band's debts and bills from his own money much more than one time when the band was up against a wall financially. Brian bailed them out, more or less. More than once, and more than we will ever know about. So did Nick Grillo, for that matter.



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"All of us have the privilege of making music that helps and heals - to make music that makes people happier, stronger, and kinder. Don't forget: Music is God's voice." - Brian Wilson
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« Reply #8 on: February 26, 2018, 03:31:43 PM »

Interesting stuff Stephen! Thanks for the insight.
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« Reply #9 on: March 02, 2018, 02:10:31 AM »

Very interesting information. Thanks Mr Desper.
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