Maybe this will sound weird to some of you, because after all, Demos are an essential part of the Music Industry.
My viewpoint regarding this matter is that, when you get called to record in a Demo, you don’t play less well because it is a Demo. You play as usual. Also, you invest (or loose) the same amount of time recording a Demo than recording the official version of the song. Then, many times, when that Demo makes it in an album, the person who called almost crying and in a hurry to ask you to record the Demo, forgets about you. It’s happened to me.
So I decided many years ago that I don’t record in Demos for other people, at least not for a lower fee and definitely NOT for free. When I get called to do a Demo I charge the same amount as if it were the official album version.
Additionally, there’s not much need to use the full band live in a Demo, because the concept “Demo” includes the acceptance of bad instrument sounds and almost zero live instruments (al least from my perspective). The purpose of a Demo is to show the potential client a musical idea, a song or a production concept.
I know some of you have lived a few horror stories regarding this.