So you've created your song and you've decided to hire a mix engineer to bring your music to the next level. The files you send are sometimes (incorrectly) referred to as “stems,” while in fact they are “multitracks.” So let's talk about stems vs multitracks.
What are Multitracks?
Multitracks are every single track from your session. If you have an instrument that has multiple elements or mics (like a drum kit) you have a separate file for each part of it (kick in, kick out, snare top, snare bottom, etc).
Multitracks are what your mix engineer will want. This lets them have full freedom to work their magic.
What are Stems?
On the other hand, stems are a handful of files that get mixed down for each overall element of the arrangement. You'll have an overall drum stem, guitar stem, background vocal stem, etc – often with the processing and effects baked in. This is usually created by the mix engineer after the mix is finalized so it sounds like the record.
Stems are used for a few things:
Stems are also useful for creating tracks for live performance. Managing five or six tracks per song as you're building your live set is way easier than wrangling 100+ tracks for a song.
Stems can be used for creating alternate mixes without needing to hire the mix engineer again. Maybe you got your song in a TV show or commercial and they want it to be instrumental during the dialog, but vocals in during a montage sequence. It's easy to drop the stems in a DAW and chop it up as needed.
Stems are often used for remixes. Rather than every little track being sent over, you'll get stems so you can still pull parts from the original, but without the dozens (or hundreds) of original tracks to manage.
Stems are also nice for sharing an in-progress song with collaborators but still solo/boost/mute parts of the arrangement while they're working on their parts. If you tried to send all the multitracks of a song when it's not needed, that would be a very large folder.
Sidenote: Multitracks.com Sells Stems
If you're in the church scene, you've probably heard of MultiTracks.com. They actually don't sell multitracks but rather they sell stems! You get a drum stem, bass stem, BGV stem, etc for each song. Still, it's a great name for their business!