Passive 360 Grab On Everything You Do - Traps & Scams Every Musician Must Avoid

Quick translation You might sign one tiny contract and suddenly a corporation is collecting money from your streams, your YouTube ad revenue, your sync deals, your merch, your TikTok virality, and the money you make teaching guitar online. That arrangement often calls itself a 360 agreement. Some are legit. Many are built to quietly claw at anything that could generate cash for you. This guide exposes the tricks, explains the legal lingo in plain English, and gives you a battle plan you can use today.

This article is written for musicians who are tired of being gaslit into thinking the label or manager deserves a cut of their entire life. You will get real scenarios you can relate to, terms explained so you stop nodding like you get it while secretly panicking, and practical negotiation lines that actually work. Also expect profanity in spirit but not in the text. We are hilarious, edgy, outrageous, relatable and down to earth. Let us roast the exploiters and teach you how to win.

What is a passive 360 grab

At its core a 360 agreement is any deal where a company takes a percentage of multiple revenue streams that belong to you as an artist. The classic example is a record label contract that takes a cut of recorded music revenue and then also demands percentages from touring, merchandise, publishing income, sync fees, endorsements, and sometimes even your Patreon or teaching income. Passive 360 grab is the version where the company is not actively managing or earning those extra streams but still takes money from them. They cash in on success they did not create. That is the grab part.

These deals are often sold like this. You get marketing muscle production money or distribution clout. In return the company says it deserves a percentage of everything because it helped build your brand. Sometimes that is reasonable. Sometimes you gave them a small service and they want lifetime rights to your student teaching revenue. That is not reasonable. That is a passive 360 grab.

Short history so you know why it exists

Record labels originally made money by selling records. As record sales collapsed with streaming labels got creative. They started asking for a piece of the live revenue because promoting the record boosted ticket sales. Then they asked for a slice of merch because their promo package increased merch demand. Managers and publishers noticed and copied the idea. Fast forward and the industry has normalized deals where one company wants to be paid for everything related to your career.

If you are a millennial or Gen Z artist who learned music via YouTube and makes money from short form viral clips you are playing a different game than the old school label exec. The 360 model often does not translate well to independent creators because your income is granular and platform based. When a company tries to claim rights to every pixel of your activity you need to push back.

Who asks for 360 style cuts and why

• Major labels They want long term upside for their investment. That can be reasonable if they actually invest meaningful sums with transparent terms.
• Indie labels and label services They often offer flexible deals but sometimes build in revenue streams with hefty service fees so they get paid no matter how the record performs.
• Managers A manager typically earns commission. Red flags appear when the commission applies to deals the manager did not negotiate.
• Publishers and administrators They handle composition income. Some ask for co ownership of the songs or ask for admin plus large percentages.
• Aggregators and digital distributors These companies can sneak in rights grabs through opaque terms and auto enroll you in services that take commissions.

How they actually grab revenue: the top tricks explained

Below are the common ways companies stealthily take money that should be yours. For each trick we give a plain English definition and a real life example that will make you glare at your old contract.

1. Broad definition of artist activities

Plain English: The contract says you agree the company gets a cut of all income related to your career. That wording is intentionally vague. It covers things like Twitch tips music lessons brand deals and even that weird Etsy candle you sell at shows.

Real life example

You signed a distribution contract and later land a paid livestream. The label claims a cut because the contract says it gets percentages from any performances that promote the record. You did the work. The label reposted a clip once. Now it wants money from the stream revenue.

2. Cross collateralization and blanket recoupment

Plain English: The company recoups its investment from every income stream before you see a penny. It takes recoupment from the money you would have gotten for songwriting publishing gigs or sync fees. Even if the company did not pay to place the song in a TV show it still gets paid first.

Real life example

The label gives a small advance for an album. A month later your song is licensed for a commercial. Instead of the advertiser paying you directly the label takes the sync fee to recoup the advance. You are left waiting for recoupment to clear before you get royalty checks.

3. Management commissions on everything

Plain English: A manager normally takes commission only on deals they negotiate. Red flag occurs when the contract says the manager gets commission on any revenue even after termination and even on income the manager did not secure.

Real life example

You hire a manager to help your touring and marketing. Two years later you land a brand deal that your booking agent closed. The manager claims commission on the brand deal because the management contract takes a cut of all revenue related to your career for five years after termination. That is a sunset clause that is ridiculously long and unearned.

4. Publishing buyouts and exploitative admin deals

Plain English: A publisher might ask for co writing ownership for mere admin services or ask for a huge split in return for admin services, meaning they collect publishing income and take a big cut before sending you anything. Admin means they register and collect royalties from performance and mechanical rights on your behalf.

Real life example

You sign an admin deal that reads as 50 percent co publishing and 10 percent admin fee. If they own half the song you lose half the writer revenue forever for the work they were supposed to do as administrators only. You basically sold half your song for tasks that cost pennies.

5. Work for hire and assignment clauses

Plain English: A work for hire clause means you do the creative work and the company owns it outright with you owning nothing. An assignment clause can assign future works or grant the company the right to claim authorship or ownership without additional consent.

Real life example

You collaborate with a producer on a beat under a contract that contains a work for hire clause. You later realize the company owns the master and can license it without paying you writer royalties. That track becomes someone else revenue stream without your share.

6. Platform monetization handoffs and content ID control

Plain English: Some companies take control of your YouTube Content ID or TikTok rights and collect ad revenue. They then apply administration fees or split percentages that look reasonable until you notice their admin fee is 30 percent of net after their own service charges.

Real life example

Your song blows up on TikTok. Instead of you getting the majority of the money the aggregator uses auto monetization and keeps 40 percent citing its service fees. You get a tiny residual check that does not reflect real popularity.

7. Most favored nations and take it all clauses

Plain English: A most favored nations clause says the company gets whatever deal terms you give to someone else if those terms are better. That sounds fair until the company uses it to demand more revenue from you or claim your better deals retroactively.

Real life example

You negotiate a better split with an indie label partner for a single. The company with the most favored nations clause demands the same split on your entire back catalog. Suddenly the label that was taking a small cut now collects across everything.

Terms and acronyms decoded like your blunt friend explaining your bad ex

Legal speak is the industry’s favorite disguise. Here are the terms you will see again and again with clear definitions and what they mean for your wallet.

• 360 deal A contract where one party takes a share of multiple income streams. It often includes recorded music touring merch publishing sync and endorsements.
• Master The actual recorded audio. Whoever owns the master controls how the recording is licensed for streaming syncing and samples.
• Publishing The composition side. Publishing collects performance royalties mechanical royalties and sync fees. Owning publishing means owning the song not the recording.
• Admin deal A publishing administration contract where a company registers songs with collection societies collects royalties and pays you back the remainder after a fee. Admin deals should not give away ownership.
• Work for hire A legal category where the person who commissioned the work is considered the author. If your contract labels your songs work for hire you could lose writer rights.
• Recoupment The process where the company recovers its expenses or advances from revenue before paying you. If recoupment applies to many revenue streams your money will arrive much later.
• Cross collateralization Using income from one project to recoup costs from another. This can trap your earnings in a net of debts that never truly clears.
• PRO Performance Rights Organization. Examples are ASCAP BMI and SESAC. They collect public performance royalties for songwriters and publishers when songs are played on radio TV streaming or performed live.
• Mechanical royalties Payments for reproducing a song. When a streaming service or a record manufacturer copies your composition you earn mechanical royalties.
• Sync Synchronization license. A sync license lets a song be used in visual media like a commercial TV show movie or ad. Sync fees are usually one time payments plus possible backend royalties.
• Neighboring rights Royalties paid to performers and master owners when recordings are played in certain countries and on non interactive platforms. The U.S. has limited neighboring rights for sound recordings but many other countries pay these fees.

Real life scenarios you will nod at because it happened or almost did to someone you know

Scenario 1: The viral song that became a corporate ATM

You post a 30 second song on TikTok. It goes viral. An aggregator you signed with months earlier auto claims monetization and routes the income to a third party. The aggregator takes an admin fee and then the distributor deducts a service charge. By the time money is allocated the actual payout to you is microscopic. You later realize the aggregator had a clause that gave it a nonexclusive admin right and the right to collect, which it interpreted very creatively.

Scenario 2: The manager who wants 20 percent of your merch sales forever

You hire a manager who drives some early growth. The contract has a sunset clause of five years and includes merch and brand deals as commissionable. Two years later you start your own merch company and run it without the manager. The manager still expects 20 percent of profits because the contract language was broad. You are on tour with a van full of shirts and a manager expecting a cut on every sale they did not help generate.

Scenario 3: The publishing admin that becomes a co owner

You need help collecting publishing royalties. An admin company offers to register your songs and collect royalties. The contract is written in a way that looks like admin with a fee but includes language that gives them co publishing ownership after a certain period. You thought you were hiring help. You accidentally sold half your songs for registration and reporting.

Checklist to review before signing anything

Print this and bring it to your lawyer. Or memorize it and act like you already know how to read legalese. Either way do not sign until you cross every item off and understand the trade offs.

• Define revenue streams precisely The contract should list exactly which incomes are included and excluded. Do not accept vague language that covers income related to your career.
• Limit recoupment Recoup only from the revenue generated by the specific project that warranted the advance. Avoid cross collateralization.
• Cap commission percentages Manager commissions are usually between 10 percent and 20 percent on the deals they negotiate. Do not allow commissions on passive income the manager did not produce and do not allow indefinite sunset periods.
• Keep publishing ownership separate Publishing is valuable. Do not give away ownership for admin services. Admin fees should be transparent and modest.
• Avoid work for hire on songwriting or performing Keep songwriter credits and publishing rights under your name unless you explicitly intend to sell them.
• Audit rights You must be allowed to audit accounts. The audit clause should permit a reputable third party to inspect the company books at reasonable intervals.
• Reversion triggers Include rights to get your masters and/or publishing back after a set period or upon failure by the company to exploit the work.
• Termination rights Have clear termination conditions for breach and for inactivity. If the company does not release your album within an agreed timeframe you should be allowed to exit.
• Clarity on who brokers deals The manager should only receive commission on deals they negotiated in writing. Define what counts as negotiation or introduction.
• Transparent fees Every fee must be listed, defined and capped. No mystery line items that read like bank heists.

How to negotiate without sounding like a scared intern

You do not need to be an attorney to protect yourself. You do need a plan and language to push back. Use these negotiation moves and scripts. They are practical and do not require legalese gymnastics.

Ask for carveouts

Say this

"I am fine with a share of recorded music income for services you provide directly. I cannot agree to a share of unrelated income streams like personal teaching Patreon or income from brands that I secure independently. Please carve those out and list them."

Why it works

It forces the contract to be specific. A company that balks at listing carveouts is trying to keep coding lines of money vague so it can take more later.

Limit recoupment and cross collateral

Say this

"Recoup advances only from the master revenues of the specific album the advance applied to. No cross collateralization across unrelated projects unless mutually agreed in writing."

Why it works

It keeps your sync and publishing fees separate and available to you. It also limits the company from using every revenue stream to zero you out forever.

Cap manager commissions and add a sunset clause

Say this

"Manager commission applies only to deals the manager directly negotiates or introduces and never to income unrelated to such deals. Commission will be X percent and will reduce annually over three years after termination to zero."

Why it works

You get protection from lifetime commissions and ensure the manager does not bank on passive income they never earned.

Refuse publishing ownership for admin services

Say this

"Administration services limited to registration collection and reporting, with an admin fee of X percent. No transfer of publishing ownership or co publishing without separate negotiated agreement and fair market compensation."

Why it works

Publishing is the most valuable long term asset. Do not give it away for registration help.

Alternatives to signing a 360 style deal

If you are not comfortable signing a 360 style agreement you still have options. Many independent artists build sustainable careers without giving away ownership.

• Distribution only agreements You keep ownership and pay a distribution fee or a flat percentage on recorded music sales only. No 360 clauses attached.
• Single release or single album license License a record for a limited time rather than giving away rights forever. After the term you get your masters back.
• Publishing admin only Hire an admin company that does not take ownership. Fees should be transparent and capped.
• Licensed services and project based support Pay for specific services such as PR marketing or playlist pitching without offering revenue percentages.
• Hire a manager on a retainer Instead of commission pay the manager a monthly retainer and define clear project based KPIs. This avoids lifetime commission on passive income.

How to escape a bad deal

Leaving a bad deal is hard but possible. Timing documented breaches and negotiation are your friends.

• Find contract breaches Late accounting failure to market or failure to release agreed records are often breaches that let you terminate.
• Negotiate a buyout If you have revenue and leverage offer a lump sum to buy back rights. It costs but gets you control.
• Use reversion clauses If the contract contains a reversion trigger such as failure to exploit within a timeframe push for those triggers to be enforced.
• Public pressure and reputation risk Some agreements are renegotiated because companies fear bad publicity. That is not ideal but it works sometimes.
• Legal action As a last resort involve a lawyer. Some contracts favor the company on paper but enforcement and litigation costs can lead to settlements.

What a fair deal looks like in practical terms

Fair deals differ by career stage but here is an example of healthy terms for an artist who wants support without selling their life.

• Distribution only for recorded music. The label receives 20 percent of net recorded music revenue until it recoups an agreed advance. No cross collateralization with publishing or sync.
• Manager commission 15 percent only on deals they negotiate. Commission drops 5 percent annually after termination until zero in three years.
• Publishing remains 100 percent with the songwriter. Admin company collects for a 10 percent fee and provides quarterly reporting and audit rights.
• Content ID remains under artist control. Any transfer of monetization must be separately agreed with transparent fees and accounting.
• Reversion: masters revert after five years or after a failure to release two albums within three years. Publishing reversion for specific works negotiable after five years.

Practical daily habits to protect your business

You do not need to wait for the contract to be signed to make yourself harder to exploit. Build systems that make you less appealing to grifters and more appealing to legit partners.

• Register everything Register your songs with a PRO and with your mechanical rights collection society. Register for SoundExchange if applicable. If you are registered the money is more likely to find you.
• Keep split sheets Always document co writing percentages on a signed split sheet before uploading a track anywhere. If an argument happens you have proof.
• Control metadata Ensure ISRC codes writer credits and metadata are correct on every upload. Bad metadata equals lost royalties.
• Understand your statements Learn how to read streaming and royalty statements. The first three months of learning will save you from years of lost revenue.
• Use basic legal review Contracts with revenue sharing should be reviewed by an entertainment lawyer. It costs but it usually pays for itself within one avoided bad deal.
• Keep business bank accounts Separate your personal and business cash. This helps when you need to prove flows for audits or negotiations.

Red flag phrases to run from instantly

If a contract contains any version of the following language stop. Walk out. Call a lawyer. These phrases are the industry equivalent of someone whispering "trust me" while hiding a bag of receipts.

• "All income related to the Artist activity" without a defined list of excluded revenues
• "Company may recoup costs from any and all revenues" with no limits
• "Work for hire" applied to songwriting or performance credits
• "Manager commission applies to all income for five years after termination" with no sunset reductions
• "Company reserves the right to assign ownership of works" without approval from the artist
• "Most favored nations shall apply retroactively" so the company can claim better terms later

When to say yes immediately

Not all companies are vampires. Sometimes a good offer appears and you should take it. Say yes when the deal gives you resources you cannot otherwise access and the cost is reasonable and limited.

• If the label offers a meaningful advance for recorded music and agrees only to recoup from master revenue you have a clear trade off.
• If a manager takes a standard commission only on deals they close and provides infrastructure that demonstrably grows your revenue you are probably in good hands.
• If an admin company offers low admin fees and no ownership and provides clear reporting that you can audit then take it.

Action plan you can use today

1. Stop signing anything with vague 360 language. If you find a clause call it out and ask for specific carveouts.
2. Register your songs with a PRO and with SoundExchange if applicable. It costs little and secures your claim.
3. Create a template split sheet and use it before any collaboration. Have everyone sign it and keep a scanned copy in the cloud.
4. Get a basic contract review from a lawyer for any agreement that touches publishing or master rights. Use a flat fee review if full representation is too expensive.
5. If you already signed a bad deal find the reversion and breach clauses. Start with negotiation before escalation. Offer a buyout if you can afford to and have leverage.
6. Document every interaction with your manager label or publisher. Written records help if disputes arise.

FAQ

What exactly is a 360 deal

A 360 deal is an agreement where a company takes a percentage of multiple revenue streams related to your career. That can include recorded music touring merch publishing sync endorsements and any other income the contract defines. The idea is the company invests in you and therefore deserves a share of many possible incomes. The problem arises when the company claims revenue it did not help generate or when it keeps your rights indefinitely.

Can a label take my publishing

Yes but they should not take your publishing for trivial admin services. Publishing is often worth more than recorded music over the long term. A company should pay market value for any publishing it acquires and you should never sign away publishing forever for basic registration help.

Is it normal for a manager to take a commission on merch

Managers usually take commission on deals they close. It is not normal or fair for them to claim commission on merch sales the manager did not negotiate or help create. If the manager insists on merch commission ask for a clear definition of manager introduced deals and a sunset clause after termination.

What is recoupment and how does it hurt me

Recoupment is when the company recovers its advances and expenses from your income before paying you. It hurts when recoupment applies to many revenue streams which delays or eliminates your payments. Avoid contracts that allow cross collateralization where one album's debt eats every other income source.

How do I know if an admin deal is fair

Fair admin deals are transparent low fee and do not transfer ownership. A typical admin fee might be 10 to 20 percent depending on services. If the company asks for ownership or a co publishing share for admin work that is a red flag. Always ask for a clear list of services and reporting cadence.

Can I remove a 360 clause after signing

Possibly. You can renegotiate or buy out the clause if you have leverage or revenue. You can also enforce reversion triggers or find breaches that permit termination. It is not easy but it is doable. Start by consulting a lawyer experienced in music contracts.

Should I hire a lawyer for early deals

Yes. Even a one hour review can save you from a contract that costs you tens of thousands. There are affordable lawyers who offer flat fee reviews for early stage artists. This is not the place to rely on luck.

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