Richard Burgess | Crain's Los Angeles

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Richard Burgess

Background:  

Richard Burgess became CEO of the American Association of Independent Music in January 2016. He has worked as a major label recording artist, produced gold, platinum and multiplatinum-selling records and is a published author. The American Association of Independent Music is a nonprofit that supports more than 400 independent record labels in the U.S. 

The Mistake: 

I didn't fight hard enough against a deal I was fundamentally uncomfortable with.

I was a musician from the age of 14 and became a professional right after school. I was a successful studio musician in the U.K and went through a series of bands and record deals. I finally had a band called Landscape I was in for about five years. We had a hit called "Einstein a Go Go." We had put together our own record label, Event Horizon Records, and were touring. We were playing for fairly large numbers of people and had a successful career.

We were making our own records, putting them out, selling them in reasonable quantities and our careers were developing nicely when we were offered a record deal by a major label. I had been signed to major labels before, so I knew what the consequences were. The rest of the band had not. We were a democratic band and took a vote that went 3-2, so we took the record deal. I was one of the two against.

The record deal worked out pretty well in so far as we had a big hit in England. It was one of the Top 5 records. We were in the early stages of the electronic music movement. On the surface of it there was some success there, but by taking the major record label we scrapped our own label. The mistake was going for the short-term gain rather than going for the slower approach to a long-term sustainable solution.

We had gone on what seemed at that point an unsustainable path. We had been kind of elevated to this artificial height. It was hard to go back to where we had been before. I felt the mistake, from my perspective, was that I let myself be outvoted.

Try to minimize any artificial pressures to make an unduly quick decision.

The Lesson: 

More than anything, I didn't fight hard enough against a deal I was fundamentally uncomfortable with. I thought there were a lot of red flags, and there were other mistakes. I didn't retain the right to my work. We stepped into a potentially unsustainable situation with a major label.

It's not true to say that I hadn't thought it through. I had thought it through and I did think we were better off continuing with our own venture because we owned everything. We should have kept that going. Instead, we were looking at this infusion of cash we were going to get from the major label and the extra promotion that we would get from them and that pulled us into that deal. We effectively handed over the five years of hard work we put into developing the band over to the label, which they capitalized on when we had the hit, but they weren't worried about helping us sustain a career.

After a couple more albums, we called it quits. Fortunately that set me up well for a production career for the next decade and a half. I was able to pivot into managing bands when my kids were little and wound up working at the Smithsonian's record label for a time.

Now I am in this job, so it is not like my career didn't develop well—but it has been a real fight over the years to get our rights back from the label. The lesson for me was not to get myself in those situations in the future.

What I try to apply to my life now is to trust my intuition more. If the situation doesn't feel right to me, I tend to shy away from it. I try to minimize any artificial pressures to make an unduly quick decision. Ever since then, I have always shied away from borrowing money and elevating myself into an artificial situation. I have always worked to build a sustainable business from the ground up and pay as I go.

Follow the American Association of Independent Music on Twitter at @a2im.

Photo courtesy of Richard Burgess.

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