How to Start a Record Label With No Money- Tips!

Starting a music label can be a big deal or not, depending on your goal and your budget. Unlike past times, the barriers to starting a record label are practically nothing these days. Therefore, figuring out how to start a record label with no money is not so hard nowadays. Many labels have been formed by someone waking up one day and announcing, “I have a record label.” Ultimately, creating a Facebook page and signing up for Soundcloud technically makes you a record label.

We can observe that the music industry is presently going through lots of changes. Record labels can no longer operate the way they did two decades ago. Streaming services, the Internet, and consumption patterns have experienced a shift over the years.  This poses a lot of complications for major labels. However, for independent labels, it creates opportunities.  Small and nimble record labels have a better advantage. Independent labels can implement some unique and forward-thinking tactics with age and time.

Nonetheless, if you are particular about giving yourself the best chance at success, a proper setup is expedient.  I know you might be worried about the cost of the startup. There’s no cause for alarm. This article will familiarize you with tips on significant steps and getting your label up and running in no time. It explores how to start a record label with no money.

  • What Is A Record Label?
  • Who Can Start A Record Label?
  • What Do You Need To Start A Record Label?
  • Tips On How to Start a Record Label with No Money

What Is a Record Label?

You might have heard the term “Record label” many times. Even though you know it’s a term used in the music industry, you are not fully aware of its functionality. So what is a record label, and what do they do in particular?  A record label is also known as a record company. It is a brand or trademark of music recordings and videos. Sometimes, a record label is a publishing company that manages brands and trademarks. Below are some of their functions:

  • Coordinates music production.
  • Manufacture and distribution.
  • Marketing and promotion.
  • Enforcement of copyright for sound recordings and music videos.
  • Conducting talent scouting.
  • Development of new and upcoming artists (“artists and repertoire”). 
  • Maintaining contracts with recording artists and their managers. 

Recording artists have by default been reliant upon record labels within the mainstream music industry to:

  • Broaden their consumer base.
  • Market their albums. 
  • Promote their singles on streaming services, television, and radio.  
  • Provide publicists who will assist performers in gaining positive media coverage.
  • Arrange for their merchandise to be available via media outlets and stores. 

Who Can Start a Record Label?

Alright! So you have always loved to make music, but your voice won’t gain you entry. But you love making music, and you’re the business type, newsflash! You can start a record label. However, you might find that funny and unrealistic, but all I’m implying is that anybody can start a record label. All you need is to be a music lover and have a great business mind. You also have to be creative and be good at managing people to start a music label.

There are no special requirements for starting a record label. The only thing is that starting something you don’t have a passion for will only lead to failure. You have to be dedicated to it once you start. Moreover, starting a record label is not as complex as it appears.

What Do You Need to Start a Record Label?

Let us consider the basic steps and expenses of starting a label and getting your first release out:

Business License and Name

They will cost you because you have to register your business name and get a license. It varies depending on the laws where you live. If you would have partners in your label, you may need a lawyer’s services to draw up a basic business agreement at this level. So, it will require an additional expense to register your business officially.

Artist Agreements

You will need legal advice to draw up artist agreements. Many small, independent labels write simple contracts without consulting a legal practitioner. However, if you aren’t sure how to start, you will need a lawyer who will help you draw up a standard contract. Remember are setting up a small label, so keep it simple for yourself and your potential artists. Elaborate contracts and agreements are unnecessary for your purposes here.


If you want to produce a physical product, the Pressing of CDs or vinyl will cost you some amount of money. Skipping physical products on your first release can ensure significant savings. The only thing is that you have to consider your audience. Are you starting a label that will release music to people who prefer to buy CDs or that tend to buy records? Going all digital-only for lack of funds might not be a good formula for success. Your lack of physical products might spell disaster for sales. You might need to prepare for artwork costs here as well.


We all know that a piece of music produced needs to be promoted for maximum success. Promotion is how you let people know about your label and your releases. The media will be your target – press, online, and any popular radio. You can do promotion in-house – believe it or not; many independent labels do just that. It is not going to be easy, but it saves you thousands. Of course, hiring an outside Publicity company for at least part of your promotion would not only save time but could also help you land some publicity you wouldn’t get on your own. It is expedient to count the cost and the benefits before you decide. 

Tips on How to Start a Record Label with No Money

Let me establish something before we start here. First and foremost, you can start a record label even if you don’t have money, but you can’t start with no funds at all. Don’t be confused here! All I’m saying is that a record label will require money from one point of startup to the other. However, you can check your spending by cutting your cost to the lowest.  The tips below will help you know how to navigate between your current financial situation and your dream to be a record label owner.

Take the DIY Approach

This approach means ‘do-it-yourself.’ It is not as crazy as it sounds.  Decide on what you want to do, create a pattern for the business. The DIY approach doesn’t require any process. You won’t need to contact any professional or whatnot. Forget legal documents or advisors for now. You can even pick a name for the label and register it later.  Many technicalities are involved in starting a functional record label, but you can skip those for now.

Check out your social network, locate an artist whose music you like, and build a relationship with them. Then offer to promote their music at a low cost. If they see potential in you, they will accept. Remember, you have little or no budget at all, don’t set out looking for something fancy. 

Forget about the legitimacy or fancy website. Just take charge of what you can for now. Do not pick an artist you can’t afford to manage. You would be getting ahead of yourself. You don’t need permission to get started. So start making connections with artists today. It’s all about you deciding to go to any length you need to.

This is the best strategy for anyone who wants to start a record label from scratch with nothing but vision and passion. You no longer have to worry about how to start a record label with no money. Trust me, nothing is impossible. 

Sell Your Ideas

I won’t want you to misunderstand me on this. Do not think you will tell people about your record label ideas, and they will start spitting money. No! It doesn’t work that way. Not everyone will buy into your idea. However, if you are persistent, you will eventually find someone who trusts you enough to give you a try. There should be at least one person who believes in you and is after your success.

Also, you can discuss a partnership with them.  The idea of partnership is a win-win proposition.

Loans and Grants

Yeah! Yeah! It’s not such a good idea. Most business consultants advise against borrowing to start a business. However, if you think about it, there’s no money you use that you won’t have to pay back eventually. I only added this option as a possible choice in dire situations. 

Consider 50/50 Deals with Artists

This tip will help you get artists while managing costs. All you will do is provide them with label services and split the profits 50/50.  Set realistic expectations. Get musicians who are interested in growing with you. A great deal of hard work can make up for your lack of substantial funds. All these could even eventually help you build your goldmine.

Focus Only On Digital Music

Skipping physical products on your first releases can bring about significant savings. The only thing is that you have to consider your audience. 


Admittedly, money makes things easier. So if you are serious about owning your label, little or no budget at all is a disadvantage. While you can start on a low budget, starting with no money at all is not realistic. That is just the bitter truth. However, it is not an impossibility. It will require dedication and passion because the journey will be full of ups and downs. You will need to put in extra effort for your brand to be successful if you want a functioning label. The trick is to have realistic expectations. Be willing to roll up your sleeves and get your hands dirty. In other words, you should be ready to make up for your lack of funds by devoting quality time to the label.