ORCA (Organisation for Recorded Culture and Arts), the global think tank and advocacy group, has published a revealing snapshot of the independent label sector.
The organisation’s second report shows how independent labels generate tangible value and income for artists through long-term partnerships and investment.
Commissioned by ORCA and written by the Centre For Music Ecosystems, the report analyses financial data from nine leading independent labels – Alligator Records, Domino Recording Company, Hopeless Records, Ninja Tune, Partisan Records, Playground Music, Secret City Records, Secretly Group and XL Recordings.
The companies’ artist rosters include 2025 breakthrough band Geese (pictured), Fontaines DC, Ezra Collective, Neck Deep, Idles, Lambrini Girls, Thundercat, Baby Rose and Wet Leg, among many others.
It shows that in 2023, these labels invested $134 million that supported 569 artists across different genres and geographies, generating a combined revenue of $239 million.
A third (33.5%) of that revenue was paid out directly to artists, with each artist on average benefiting from $236,197 in investment, covering everything from production and touring to marketing and career development.
For every dollar invested, independents generated $0.77 in profit, and 77% of that profit ($0.59) went directly back to artists, reinforcing the benefits of the independent label model built on long-term partnership to develop careers and deliver shared success.
This investment has also translated into measurable growth in artist audiences.
The report breaks down the cost of increasing Spotify followers: 0.67 followers for every $1 invested. Artists supported by participating labels saw an average 44% increase in Spotify followers between 2023 and 2025 (up to 130 million among the nine labels’ acts), in an environment where gaining cut-through has become challenging.
“More than 202 million tracks were available on audio streaming services at the end of 2024, and an average of 99,000 new tracks uploaded to these platforms daily,” stated the report. “Combined with AI fraud, this illustrates the increased competition for visibility, listenership, and engagement faced by artists.”
Independent labels have always championed a long-term mindset, developing an artist over time, taking creative risks and nurturing new sounds that shape the music industry
Patrick Clifton
“For the first time, we have real numbers that show the economic power of independent labels and the benefits this model delivers for artists,” said Patrick Clifton, executive director, ORCA. Independent labels have always championed a long-term mindset, developing an artist over time, taking creative risks and nurturing new sounds that shape the music industry. This report shows how this approach provides tangible and meaningful returns for artists, while sustaining a business model that benefits culture, the economy and society more broadly.”
Diverse income streams helping to support artist development
According to ORCA’s report, label revenue is sourced from a diverse mix of income streams, with independent labels using different strengths and opportunities to deliver value for their artists.
Streaming accounts for the largest share in revenue at 59.5%. This is followed by physical sales at 25.9%, which is substantially higher than the global average of 16.4% across the recorded music sector, driven by highly engaged fanbases investing in vinyl and collector-oriented releases, particularly among more niche genres, according to the report.
In the UK, vinyl sales have continued to rise, according to the most recent market figures.
Sync also stands out as a significant revenue contributor (7.4%), over three times the global average (2.2%).
“This figure underscores sync’s growing role as both a revenue source and promotional platform, with labels increasingly using placements across film, TV, advertising, and gaming to expand reach and strengthen artist campaigns,” stated ORCA’s report.
“It’s how you build around the sync,” said Justin West, president and CEO, Secret City Records. “It’s the work that’s required to capitalise on these things and how we utilise that to drive records and break careers that really matters.”
Artist relations and strategic support
Of the total $134m in total costs among the labels, 6.7% was spent on artist relations and strategic support, including global inter-connectivity support, business affairs and artist services.
Beggars Group’s Simon Wheeler, director of global commercial strategy, is quoted in the report. He explained that his team manages around 200 digital partnerships worldwide, which play a critical role in helping artists reach new audiences by expanding their presence across a wide range of digital platforms and markets.
“I think it’s key to approach anything by trying to see the opportunity rather than the threat first,” he said. “There may be both, but we try to approach the opportunity while being mindful of the risks. We try and think, what do we want to do? How do we want to do it? What does it mean for our artists?”
Artist creative development and production
In terms of their total expenditure, labels spent 9.6% ($12.9m) on artist creative development and production support.
In 2023, ORCA member labels invested an average of approximately $52,7000 per artist in supporting artist creative development and production related activities.
Of the artist creative development and production investment, 47.1% ($6.1m) was allocated to creative development services, and 34.9% ($4.5m) went toward A&R development. Together, these two categories represent over 80% of spending in this area.
Label investment in supporting artist recording costs, including directly financing studio time and production, represents 16.5% ($2.1m) of this expenditure.
A&R development forms the early creative and relational foundation of the label-artist partnership, according to ORCA’s snapshot.
“We go through and talk about what it is that we’re planning for the whole year or the next 18 months,” said Erin Choi of Hopeless Records. “The whole thing for us is that everything’s going to move at a different pace… It doesn’t need to be an overnight success.”
Tim Putnam, co-founder and president of Partisan Records, added: “You don’t nurture art, you nurture artists… Our job is ‘how do we become fluent in the language of each artist’ so we can teach it to audiences.”
A collaborative approach across marketing, promotion, A&R and management is grounded in an understanding of how audience attention is earned and retained.
“Some artists may come to us and do not have the understanding of what works on socials,” explained Jessica Park of Secretly Group. “We’re looking at a lot more data than an artist can do on just their own socials, and this is one of the key things that a label can offer.”
Artist marketing, distribution and visibility
Of the $134m in label costs across the companies, a significant chunk – 36.4% – was spent initiatives around artist marketing, distribution and visibility. This translates to an average investment of approximately $110,000 per artist.
Global distribution activities represent the largest share, 50.2%, of these costs for labels ($24.5m). It includes both digital distribution through DSPs and physical manufacturing and logistics.
“Distribution is not a hands-off thing,” said Tim Roddis, global head of digital operations at Beggars Group. “You’re making sure that the pipeline is solid, the data is coming back, the pay is coming back.”
In parallel, physical distribution remains vital for independents.
Marketing costs represent the second largest area of spending within artist marketing, distribution and visibility at 27.8% ($13.6m).
These marketing costs encompass release campaigns, media channel management, influencer initiatives, and other audience engagement strategies. Promotion accounts for another 12.7% ($6.2m), focused on securing media coverage and engagement boosting activities like performance opportunities across platforms such as TV, radio, podcasts and streaming services. Artist brand development investments representing 1.5% ($708,000).
Independent label model
“Over the past two-plus decades, I have seen the recorded music business shift from CDs, to downloads, to streaming,” said Anna Bond, director of planning and initiatives, Secretly Distribution. “And now it’s streaming, vinyl, CD, cassette, and novel format du jour – all at the same time. Through it all, the constant has been independent record labels doing the heavy lifting, not only to keep up with these changes and to get important musical recordings to market, but to invest money, time, and energy to develop artists – in the truest sense of that word.
“This report shows that, while new models for distribution and marketing are constantly emerging, the independent record label model continues to provide the expertise, resources, and support musicians need to reach ever-bigger audiences and develop sustainable careers.”
Independent labels above industry average for women in leadership
Across the wider music industry, women hold just 13.2% of executive and senior management roles, according to the USC Annenberg Inclusion Initiative.
Among the participating independent labels, that figure rises to 31.5% – more than 15 percentage points higher than the industry average – with women also making up 46.6% of total staff.
Female presence on the artist side follows a similar trend. In 2023, 23.1% of active artists at the participating labels were women, and a further 18.7% of projects involved mixed-gender collaboration, meaning women were represented in 41.8% of all artist projects.
In comparison, the Counting the Music Industry study, which looked at gender representation across more than 200 UK labels, found that just 26.23% of signed solo artists were female and only 14.9% of musicians in groups were female. While further progress can still be made, this highlights a notably higher level of gender equity among the participating labels across both leadership and creative talent.
Founding supporters of ORCA include: Because Music; Beggars Group; City Slang; Domino Recording Company; Everlasting Records!; Exceleration Music; Hopeless Records; !K7 Music; Ninja Tune Records; Partisan Records; Playground Music; Secret City Records; Secretly Group; Sub Pop.
PHOTO: Geese, Partisan Records (Mark Sommerfield)