What does it mean to be signed to a record label?

In most cases, when signing with a “major” record label, the label will offer the artist a large cash advance. This can be used for anything and everything in the artist’s music career. Keep in mind though, that every dime the record label invests in the artist, they expect to get back. If the music label never recoups what they’ve invested in the artist, the artist will never see any of the royalties that their music generated. All of that advanced money must first be paid back to the record label.