"like" aka "similar to", aka "shares some features"

An advance is "like" a loan because in both cases, the money is expected to be paid back by the person or group of people who receives it. There's lots of differences. Repayment terms. Exit clauses. Interest rates etc. But seems pedentic to say that the advances offered to musicians are not like loans they take so that they may have a claim on the future revenues of the sales produced by their work.

Well yes, but flippantly describing the arrangement as "rich dudes convincing poor dudes to take out a huge loan" makes it sound far more exploitative than it actually is.

It’s astounding how often people conflate advances and loans when talking about the music industry. If anything it’s closer to seed capital than a loan.

Don't you have to pay back advances? Never heard of that happening for failed investments outside of fraud

Advances are recouped from the sales of your albums or tickets. Assuming you’ve made a good faith effort to fulfill your obligations you don’t need to repay the advance or pay interest on the advance if your album doesn’t sell.

> Assuming you’ve made a good faith effort to fulfill your obligations you don’t need to repay the advance or pay interest on the advance if your album doesn’t sell.

It depends on your contract. Usually, poor sales won't result in needing to repay an advance. However, there are plenty of other clauses that the contract could contain that would lead to the contract being canceled and potentially the advance having to be repaid (due to delays, editorial disagreements, poor quality, etc.)

Given the low ratio of “making it” to “wanting to make it” I would assume that there are many people who DO actually take out loans.

Joe Satriani famously self-funded his first album by taking on large amounts of credit card debt.

I'm sure there are many, many other musicians who took a similar risk that didn't pay off as well as it did for Satriani