To onboard your business & create your first statements, there are eight steps you will need to walk through. Every step in the process builds onto the next one, so it’s important to follow this order so you don’t waste your time putting the cart before the horse!
- Create Payees for every artist you have– Each Payee represents a statement beneficiary. By creating a Payee, you essentially create an artist portal. IMPORTANT: some artists will require more than one payee. This would be the case for a band to whom you are responsible for providing individual accounting to each member.
- Create a Deal for every agreement you have – Here you define your artist/licensing/distribution deals and their contract terms. Each agreement that you have in place will need their own Deal, and each Deal will be mapped to a specific content. IMPORTANT: a good rule of thumb is that if you’ve created a contract for it, it needs its own deal. For example if Artist A records a 10 track album, where one track is a collaboration with Artist B, you would need to create two deals within Habitat. One deal that covers the 9 songs owned solely by Artist A, and one deal that covers the collaboration between Artist A & Artist B.
- Add your Revenue Streams – This is where you upload your revenue data from your sales reports. Habitat will also populate with your content during this step by pulling metadata from the Revenue Report. Revenue is then associated with its corresponding content.
- Connect your Tracks to your Deals – This step allows our royalty processor to route revenue generated by pieces of content in our system, to the corresponding Deal, sort it by the terms of each Deal & expense item, then finally allocate it to a Payee.
- Create your Expenses – Add Expenses that you need to recoup from your releases or payees. Habitat supports a huge combination of methods that you can use to determine how, when and where expenses are recouped from various payees.
- Validate and Create Statements – After Deals, Revenue Streams, and Expenses are finalized, Habitat Financial will process all the information in our system to create Statements for every Payee that are accurate and easy to understand.
- Give artists access to their portal – When creating Payees, you will need to send an invitation for Payees or Artists to receive access to Habitat Financial platform and to view their royalty statements and payments.
- Pay your rights-holders - Create payments to your artists directly within the Habitat app. This will then be reflected as paid on any statements and is the simplest way to send money to multiple artists at the same time.
For example, let's say you are working with the artist Calvin & Friends who have released their debut album Edgar. You will need to create a Payee for the artist Calvin & Friends where they can collect their statements, then create a Deal for Edgar [Album] where you specify their deal shares and link it back to the respective payee. You’ll then add your sales reports into the Revenue Stream section of the dashboard. Once this data is processed, Habitat will automatically populate your account with any new Tracks that appear on your sales reports. Then you’ll add all the tracks from the album Edgar to the Edgar [Album] Deal—this will ensure that revenue from those tracks is routed to the correct deal and subsequently the correct payee. Then, by clicking “Reprocess,” Habitat will bundle these sales together, apply the Edgar [Album] deal sharing terms, deduct any recouple expense amounts, and create a statement with a balance that is payable to the artist in Statements. Once you invite your artist as a User on Habitat Financial, they will be able to view their statement in their Payee portal. Then you can use the Payments portal to ensure Calvin & Friends is paid quickly and transparently.
For a more in-depth look at the tools and features of Habitat Financial, let our co-founder and CEO Calvin Windschitl explain it to you:
Next: How to Create Payees?