A Business Manager on Making Your Money Work For You
This blog post came from Spotify.
Kristin Lee explains how and why musicians should stay financially organized.
Kristin Lee is professionally left-brained. A serendipitous encounter with a headhunter took her love of music and combined it with her training as an accountant to create an invaluable part of any artist’s team. From balancing budgets to completing your taxes, a business manager ensures that your money is working for you. In this Co.Lab, she discusses the myriad ways in which your career operates like a business and how to ensure that you’re protecting your assets.
Spotify for Artists: How did a former accountant come to work in music?
Kristin Lee: Many moons ago, I also played in bands and thought that would be my career trajectory. I went to school for accounting but found it to be a bit boring and tiresome. In my early 20s, I met a headhunter who put me on this path. I didn’t know until I was educated on what business management was, that there was such an in-depth, niche field of work here.
Recording and touring artists, writers, actors, producers—anybody in the entertainment space needs a business manager. You look at that group of people and you realize a lot of them are very creative and highly intelligent but not necessarily big on organizing numbers and documents. I swoop in and take care of the things that might overwhelm them, giving them the peace of mind to focus on what they’re good at.
What does that look like on a practical level?
We could be working on budgets for an upcoming tour or reconciling a tour that just happened so we can show the artist how they did in terms of revenue and expenses. We’re doing tax returns, we’re securing insurance for artists’ projects—for filming, for tours, for equipment, for renting buses and vans. On top of that, we’re also usually paying all of their bills and keeping all of their books. It’s doing a lot of the day-to-day to keep their business running because each of our clients is essentially a business. They’re a brand, they’re a company, and their company might have different avenues. We’re maintaining all those avenues and everything that goes along with them. It’s almost like we’re their CFO.
What’s the difference between you and someone’s manager?
There’s a little bit of crossover in the advisory space. A manager is on the ground most of the time. Whether it’s liaising with a publisher or a record label or working on touring, branding, publicity—they more or less work out the basic details of deals. When it comes time to figure out the financial and tax implications of those deals, I come in and we go on a deeper dive, working together to make sure that we’re maximizing the benefits for our artists.
How does your work then fit within the larger team?
Some people really value us and our opinions on multiple levels of their careers, and some people really use us exclusively for business and financial services. It’s an individually-tailored experience that’s learned over time. I’m a lot more involved with some clients and their management team than others. One artist that I’ve been working with for years and years now has started to just value my creative input as we’ve gotten to know each other.
How do you navigate the sensitivities present in dealing with an artist’s money?
I’m a signer on my client’s bank accounts and I can move their money around at will. So they have to trust that we are doing everything extremely above board, and that we’re being very transparent with them. It becomes a getting-to-know-you process and a continual dialogue. It does me a disservice to control it all and gate-keep the information because I don’t really like to make the decisions of how that money is used or moved around, but I do like to guide and educate people to make the right decisions for themselves. That also gives them a sense of security that things aren’t being mismanaged.
What do you recommend an artist without a business manager do?
Keep extremely detailed and organized records because I find that more often than not, we have to travel back in time and piece things together. It’s extremely time-consuming and frustrating for everybody if something comes up and we’re like, “Oh, I don’t know what happened there actually. I don’t know what that was for.” You need a paper trail. It can also cause tax issues because if you’re not reporting things properly, that can really come back and bite you. Being organized and keeping good records at the beginning will set you up for success later.
-Spotify For Artists