How Indie Record Labels Work

Band composing a new song in a studio
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An independent label, also known as an indie label, is a record label that is independently funded and not connected to one of the big three major labels. Indie labels range from home-based hobby labels to highly profitable, large businesses. In the 1990s, the line between indie labels and major labels began to blur somewhat, and now some large indie labels are actually distributed by the big three major labels.

Indie labels often face an uphill battle trying to get their music heard, as they typically have far fewer financial resources to promote their music than major labels do. Despite the struggle, many labels have survived, and thrived, for years, and many other indie labels may not have lasted forever but had a tremendous impact on music both creatively and in terms of business.

Benefits of Signing With an Indie Label

Indie labels have more freedom to pick and choose what artists they work with. If they decide to sign with you, it's because they like your music and your taste. They are less likely than major companies to insist on changes to your sound or image.

You will get to know the indie label staff very well. With fewer artists to work with and a more intimate staff, you are more likely to connect with someone and get a quick response. You will have more creative control with an indie label than with one of the Big Three. Most indie labels also sign smaller, shorter contracts, so if it doesn't work out, you're not stuck with the same company for very long.

Drawbacks of Working With an Indie Label

One of the biggest drawbacks to signing with an indie label is money. While there are some labels that are very profitable, most independent ventures are very tight on funds. Not only can they not afford large payouts, bonuses or large recording contracts, they also cannot afford large marketing campaigns or promotional tours to help build awareness of your work. This can make it more difficult to build a name for yourself and sell your records.

Additionally, because indie labels are so small and often short-staffed, they can be disorganized and even confusing. Much of their agreements are done with just a handshake rather than a formal contract, so details can be missed and issues can arise due to misunderstandings.

Finally, the smaller size of indie labels can limit the future opportunities for you. Because of their smaller budgets and smaller strings of artists, independent labels typically don't have strong relationships with the press, making coverage of your events hard to come by.

Signing with an independent label has its upsides and downsides. Before you sign an agreement with any label, make sure you understand what you are agreeing to and what your options are. Who you sign with has huge implications for the future of your career.