Nirvana was unhappy with Sub Pop at the time and was looking for a record label that gave them more freedom. At the time Nirvana and Sonic Youth were very good friends and Sonic Youth recommended DGC.
Nirvana had two options at the timne; SIgn the contract were they where guarenteed 750 thousand dollars but have limitations or sign the contract which let them have more freedom but they would get a percent of how many copies of Nevermind were sold and have few limitations.
In other words, sign the contract to get guarenteed money and have less freedom and no risk, or take the risk of not getting 750 thousand but have freedom to do what they want.
Krist said it himself they didn't want the money they just wanted to put a record out and make a difference. Nirvana didn't go to the mainstream, the mainstream came to them. After all the unwanted publicity Cobain received he said he wanted to go back to writing songs on an eight track but the only thing keeping him from doing it was if he left the spotlight he didn't know if he would ever be able to get back.
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