Guarantee vs Percentage
Deal structures where performers receive fixed fees versus revenue shares.
Definition
Live entertainment deals typically structure compensation as guarantees (fixed fees regardless of attendance), percentages (shares of ticket revenue), or hybrids combining both. The right structure depends on act drawing power, venue economics, and risk tolerance.
Established acts command guarantees that shift risk to promoters, while emerging artists may accept percentage deals offering upside potential.
Why It Matters
Deal structure significantly impacts financial outcomes for performers and promoters. Understanding these options helps both parties optimize arrangements based on their circumstances and goals.
Market conditions influence which structures prevail, with strong demand favoring artist guarantees and soft markets shifting risk to performers.
Examples in Practice
A heritage act might command $500,000 guarantees regardless of sales, while an emerging artist might accept 85% of net receipts after expenses. Major tours often blend guaranteed minimums with percentage escalators once thresholds are met.
Festival deals typically involve guarantees since artists can't control overall event promotion and attendance.