When comparing music distributors, you want to make sure you are getting the best deal, so naturally, you will want to know if DistroKid takes a percentage of your hard-earned Spotify dollars or not.
No, DistroKid does not take a percentage of your earnings. You keep 100% of your earnings minus any standard banking fees, taxes, or PayPal transfer fees that may incur when you withdraw your money.
If you’d like to learn the ins and outs of where DistroKid stands on taking percentages, simply read on, my friend! 🙂
Does DistroKid Take A Percentage?
DistroKid does not take a percentage of your earnings.
However, they do have an extra “YouTube Money” feature that is extra and completely optional. If you do choose to opt-in to this service, DistroKid will only take 20% of the revenue from the YouTube videos they find that are using your music.
It’s important to note that you still keep 100% of the royalties that you get from having your music up on Spotify, Apple Music, and all the smaller streaming services and stores.
DistroKid simply takes a percentage if you want them to scour all of YouTube for any video using your music so that you get paid royalties for their use of your music in their video.
You should also know that if any store takes a cut (for example, iTunes takes a 30% cut), you obviously have to pay that store that cut. DistroKid will NOT take a cut on top of that.
Why this is important
This is important because the main reason you are (most likely) using DistroKid is to get your music on Spotify. Let’s be honest.
And DistroKid does not take a percentage of your Spotify royalties AND doesn’t charge you a fee per song you upload every year.
You pay the annual DistroKid fee and you get to upload unlimited songs and keep 100% of the royalties. BTW – you can save 7% on your first annual fee with DistroKid by clicking here. 🙂
A lot of other music distributors take a percentage or charge you for every song or album that you upload. And then make you pay for each song or album to stay up every single year.
So why is that a big deal?
There are two reasons, my friend:
- You have to pay more out of your own pocket to have songs up and don’t get as much royalty money headed your way.
- Uploading new music consistently (every 4 to 6 months) is one of the secrets to Spotify success.
In fact, using DistroKid in this way (uploading songs on a monthly basis) is one of the ways I caught the attention of the Spotify editors and landed my songs on 7 different Spotify editorial playlists.
How Much Does DistroKid Cost?
DistroKid costs $19.99 USD per year. However, DistroKid does have multiple plans available and even has optional extra features that you can choose to pay for.
In my opinion, the only two main plans you will want to consider are the Musician and Musician Plus plans that they offer. For a comparison of the two, check out my article, DistroKid Musician vs Musicians Plus, to help you choose the right plan.
DistroKid also offers “Label” plans, if you want to distribute music for 5 or more artists. You can check out a breakdown of their plans by clicking here.
What about these paid “extra features”?
I personally don’t even bother with these paid extras, but here is a breakdown of what DistroKid offers if you would like to know:
- Shazam & iPhone Siri so that people can identify your music using Shazam or Siri is $0.99 per song per year
- Store Maximizer so that DistroKid automatically adds your music to new stores as they add them is $7.95 per album per year
- YouTube Money, as mentioned earlier in this article, is $4.95 per single per year / $14.95 per album per year AND 20% of YouTube ad revenue.
- Leave a Legacy so that your music stays on all streaming services and stores if you stop paying the DistroKid annual fee or you die, is $29 per single and $49 per album.
- Cover Song Licensing so that you don’t have to worry about legal stuff like obtaining licenses for your cover songs is $12 per cover song per year.
In my opinion, none of these things are really essential and I don’t bother with any of them when I am releasing my own music. But, at least you know they exist and how much they cost just in case. 🙂
What Royalties Does DistroKid Collect?
DistroKid only collects the money owed from your music’s sales on stores and streams from streaming services. This money could be looked at as Spotify royalties or streaming royalties, and are technically called mechanical royalties.
However, DistroKid does not automatically collect additional royalties such as songwriting royalties and performance royalties.
Publishing companies such as SongTrust or Kobalt can collect all your songwriting royalties and performance rights organizations (PRO) collect your performance royalties.
Performance rights organizations are usually specific to each country. Examples of PROs include:
- ASCAP
- BMI
- SESAC
- SOCAN
If you are starting to grow your Spotify streams, you should definitely look into properly collecting your performance and songwriting royalties.
It may not be a lot at first, but you are definitely leaving money on the table by ignoring the additional royalties you are owed.
If you’ve ignored these royalties up to this point, fret not, my friend. In most cases, these companies can collect the royalties you are owed retroactively. This means you will collect the previous royalties you are owed once you get set up.
How Does DistroKid Make Money?
DistroKid makes money by charging an annual fee to use their service and by charging for smaller optional features.
In a Reddit forum, the question “How does DistroKid make money?” gets brought up and the founder quite simply and bluntly addresses the question:
It’s actually a pretty funny and direct response to the question haha.
If you are looking for more detail, a Redditor also mentioned that the company stays in business by keeping employee counts low and not taking on any external investors.
This would mean that is very clear that DistroKid simply makes their money and stays in business by charging its users to use their service.
Simple as that.
