What Is An Independent Record Label- Pros & Cons

So, you’ve just recorded what seems like a hit song, and you’re proud of your work. Your hood buddies and even your small-time haters around the block are quickly recognizing your potential. From the look of things, the capability of your talent is no longer in question. After all, you are quickly earning new fans that are happy to consume your music. At this point, you are eager to share your work with the world! But wait, will well-established record labels accept your work? Unfortunately, major labels hardly ever work with emerging musicians. If you are considering their indie counterparts, stick around to learn what is an independent record label and the perks and drawbacks such establishments have to offer.

If your end game is to reach a wider audience, grow your following, and make a name for yourself, an indie label may just suffice. It could be your stepping stone to landing deals with major record labels. Dive in to determine whether indie labels are what you need to propel your music career to the next level.

  • What Is an Independent Record Label?
  • An Overview of the History of Independent Record Labels
  • What Is An Independent Record Label?—Understanding The Pros And Cons
  • Independent Labels vs Major Labels
  • Conclusion

What Is an Independent Record Label?

Independent record labels are popularly known as indie labels. They are independently funded establishments that range from large and highly profitable companies to small hobby-based firms. While they may have limited financial resources compared to the fiscal muscle of significant labels, such establishments have survived and thrived over the years. Their impact on the current music industry cannot go unnoticed.

Any recording label operating without the financial backing of the organizations behind major music labels is an indie label. While major labels run their distribution and publishing companies, indie labels mainly survive thanks to long-standing partnerships or short contracts with publishing and distribution companies. All the same, getting signed up with an independent record label remains one of the most realistic objectives for new and emerging independent artists. Such companies offer a decent number of perks that make them just as good as their well-endowed counterparts.

An Overview of the History of Independent Record Labels

If you are interested in understanding what an independent record label is, you may want first to know how such establishments emerged. Well, contrary to popular belief, indie labels are not new in the music industry. They are as old as the post-war era and were popular among artists who were not deemed mainstream. For instance, Sun Records is one of the oldest indie record labels established in 1950. It focused on signing rock and country music artists and brought stars like Jonny Cash and Elvis Presley to fame.

Like modern indie records, traditional records also focused on signing artists who were yet to make it big within the highly competitive industry. Numerous record labels were founded in the 60s and 70s, mainly by successful artists. For instance, Elton John launched The Rocket Record Company, and The Beatles founded Apple Records. Even Madonna’s first label Sire Records was once an indie label.

What Is An Independent Record Label?—Understanding The Pros And Cons

For many artists, signing up with a record label is a crucial recipe for their survival and success. With new independent record labels coming up every other day, it is clear that major record labels are not the sole “essential players” in the industry. Now that you know what an independent record label is, the next important step is to find out whether such companies are the right fit for you. 

Let’s have a look at their pros and cons

The Pros

Personalized Experiences

One of the main perks of working with an independent record label is feeling like a partner. Usually, artists enjoy the quality of the relationships they build with everyone within the firm. Remember that indie records are smaller in size and often have fewer employees. Because the hierarchy is not so solidified, you could even enjoy opportunities to work with the best partners of a firm directly.

Creative Expression Is Encouraged

Furthermore, you don’t have to worry about someone micromanaging your affairs. Major record labels are notorious for setting high demands that limit how artists can express their inspirations. Additionally, your contractual obligations may make it mandatory for you to make certain appearances or play a part in specific promotions.

Things are a bit different with independent record labels. In this case, the experts encourage self-marketing and give you plenty of control over how you represent yourself. This allows you to show your audience who you indeed are and express yourself freely in your lyrics, songs, and social media posts.

Larger Royalty Percentages

Surprisingly, working with an independent record label could just leave your pockets fuller. Such establishments are always ready to offer fair royalty percentages just to get and keep your business. On the other hand, major labels have the upper hand during negotiations. A 50/50 deal would be hard to come by unless you are promising to take the industry by storm.


You may not fully understand what is an independent record label until you know something about their contracts. Unlike major labels that often have complex agreements, indies keep everything dead simple. Even if you have to sign the dotted line, the company is less likely to have a list of never-ending demands on its contracts. Furthermore, indies often sign up artists for short, single-album deals. This reduces the contractual jargon for artists and makes deals just as basic as a “gentleman’s handshake.”

 Co-Publishing Deals

Because of funding issues and the company’s sheer size, indie labels are more likely to encourage co-publishing deals. Such deals allow you to co-own the copyrights and hopefully earn at least half of the income earned from your work. As such, you don’t have to worry about making peanuts as your music generates millions. If you turn into an overnight sensation and sell a million albums, half of the income earned will end in your wallet.

More Growth Opportunities

Independent record labels do their level best to exploit an artist’s potential to the maximum—but in a good way. Usually, they don’t let any revenue-making opportunities pass them by. Even income from merchandising rights ensures some money gets into their wallets and also that of their clients. On the other hand, major record labels will often focus on music. Again, this is a good thing. However, turning a blind eye to great opportunities such as merch sales may leave some artists not earning to their full potential.

There are numerous artists today signed with major labels that started off with indies. The growth opportunities presented allowed them to grow at a steady pace and within a less pressurized environment. Some artists have maximized their success by sticking with independent labels under a partnership with a major label.

The Cons

Limited Reach

One significant perk major record labels have over their indie counterparts is access to more funding and resources. As such, you can expect independent labels to be much smaller with lesser staff. Generally, the smaller size of these companies means they have fewer strings to pull.

Consequently, indies cannot do some serious muscle-flexing in event promotions, marketing, and even appearance booking. This is more so when you compare them to major labels. Even with the promise of a more significant percentage of the royalties earned, lesser coverage often calculates into lesser net revenue.

What Is An Independent Record Label? Lower Budgets

Because independent record labels are independently funded, they tend to have smaller budgets compared to the majors. This means little or no advances, not to mention a limited reach in marketing and event promotion. This drawback may limit your exposure and consequently your success as a musician.

Limited Commercial Influence

Let’s face it; nothing can open doors for you faster than introducing yourself as Jonny from Universal Record Label. Unfortunately, specific opportunities may not be within your reach if the only backing you have is of an indie that is a far cry from a popular establishment. Major record labels have more connections and more commercial influence. Compared to indies, they enjoy more media publications that give their artists more exposure. Even with more ruthless contracts, the exposure you enjoy may just propel your career to the next level.

Independent Labels vs Major Labels

Understanding what an independent record label is is the first step to knowing whether they can offer you the type of deals you are after. However, it is best to know that there are specific standards you must meet, irrespective of whether you want to sign up with an indie or a major. In both cases, you must first develop a fan base and prove that investing in your work can generate reasonable profits. Once you create a buzz around your music, your record label of choice will now step in to cater to the business side of things. You will enjoy more time focusing on creating great music and showing up for live shows.

So, independent vs major record labels, which one is better? Well, it all boils down to how these two establishments operate. Majors offer more financial backing and promise more exposure. However, they have tougher contacts and offer lower royalty percentages. On the other hand, indies work with lower budgets but provide personalized and more artist-friendly services. From a professional perspective, both options are great. Indies work better for some artists, and the opposite is also true. You simply need to consider your goals and personal preferences to make a choice that is in line with your career plans.


Signing a deal with any three major record labels (Sony, Universal, and Warner) is good. These are huge organizations that command great respect within the industry. However, all is not lost if such labels don’t sign you up. You always have the option of turning to indie for the much-needed professional music publishing and distribution services. For most artists, this is a more realistic goal with plenty of benefits to offer. Now that you have a comprehensive understanding of what is an independent record label go ahead and get signed up!