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How to Start a Record Label in 2024

How to Start a Record Label
February 27, 2024
Since the dawn of the professional recording business, landing a record deal at a major label has been viewed as the holy grail by many independent artists.

But not in 2024. It's never been easier to set up your own label, so we’re here to take you through everything there is to know about starting a record label.

How to start an independent record label

So you've decided to start an independent record label. Great! Just before we get into things, here's a quick rundown of what a label actually is and what is does.

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What is a record label?

Record labels are brands or companies responsible for producing, promoting and ultimately distributing the recordings of their signed or associated acts. They can be big or small, major or independent.

What does a record label do?

Within a label’s set-up, various departments specialise in certain areas of the music life-cycle. This usually includes marketing, legal and music distribution departments - all collaborating to maximise record sales (both physical and digital) and enhance the visibility of the label’s artists.

What are the major music labels?

The Big Three: Warner Music Group (WMG), Universal Music Group (UMG) and Sony Music Entertainment. Seen by many as the music industry 'bad guys', these three major labels hold the majority share of the record label market.

Securing a record deal at one of the Big Three used to be seen as the be-all and end-all of musical success, but with the growth of indies - not so much anymore. 

Within the majors' umbrellas, you'll find smaller labels. For example, UMG's umbrella includes Island, Capitol and Polydor and Sony's features Columbia, RCA and Epic Records.

The rest of the market share is made up of independent label owners - like you! With this share increasing year on year, there's now more more opportunities than ever to make money as an independent record label.

How to start a record label - record shop

How to start your own record label

To start your own record label, you need to be determined, organised and have a good music industry network established.

On top of this, you'll need to have a good ear for music - signing artists that you truly believe match the label's ethos and who'll help take things to the next level. So without further ado, here are the key steps you need to follow to start running an efficient and independent record label.

1. Carry out market research 

First of all, you’ll wanna see what other labels are operating in your area and if there are any opportunity gaps in the market.

If you’re based somewhere that already has a number of renowned rock labels actively signing new artists, then you should consider what other genres are thriving within the scene and look to build your own roster from there. 

You’ll also need to analyse how other labels are run, the potential costs associated with running things, and what niches you can look to appeal to. 

The better your understanding of how other labels are doing things, the better you can run your own. Take forward the good, leave behind the bad.

How to Start a Record Label - record collection

2. Look for label funding

Being on top of your finances when setting up a record label is vital. You’re not only impacting your career, but the careers of all of your artists too. 

Plan out how much you’re going to need to properly set up your label, hire any staff members and how much it'll cost to effectively promote your artists. 

Luckily, there's loads of funding available to record labels who need a helping hand getting their music projects off the ground. Our Music Funding Map is full of the latest opportunities around the world that can boost your budget.

You’ll also be able to set your label up on a budget with Ditto. Our Labels plans provide you with everything you’ll need to manage multiple artists and access new revenue sources for your acts - all while staying fully independent. 

3. Choose a record label name

Your label name isn’t always as important as you might think it is. Keep it simple and try out our band name generator for some label name inspiration

Our advice would be to look for available names on social media and check out URL options to make sure you’re not competing for traffic with anyone else.

Once you've done this, you can start testing your label name with sample logos and merch mock-ups. It'll all start feeling real once you've got your brand on a tote bag.

Tip: Check if your label name is available with Namechck, ICANN's Lookup tool and GOV.UK's Company name availability checker.

4. Define your label goals

With so many things to organise, it's important you stick to your plan and stay on track of your goals.

Lock in tangible goals for the year ahead and outline milestones that reflect your values and impact on the industry.

Do you want to hit 10,000 followers on your label's Instagram account, sell out a label event at a local venue, or push one of your artists onto the UK Top 40? Whatever your goals, make sure they’re achievable and measurable. There’s never been any harm in setting optimistic goals, but make sure you’re not left disappointed and deflated if you don’t reach them all right away.

Tip: Use our Record Label Business Plan Template to keep on track of your goals.

5. Create your record label brand

Now for the fun part. Building your label brand. This is where you’ll be able to express your brand vibe through your music, artist merchandise, and online social media presence.

Your brand will visually represent your label so be as creative as you want. Just make sure you’re consistent in your brand messaging and appearance. Think of instantly recognisable labels like Dirty Hit and XL Recordings.

If you need some inspo, check out our list of the best AI artwork tools to get you started.

Once you've decided on your look, keep track of your label logo, fonts, colour scheme and design elements by organising them in folders. Trust us, you'll thank yourself later.

6. Identify your audience

Understanding your audience is an essential part of setting up your record label. There are countless labels out there, each with its own unique audience and following so don’t be afraid to lean into a particularly niche space. 

Once you understand what your audience likes, sign artists that appeal to them and build effective promotion strategies around these artists. Tailor your marketing efforts by defining their preferences, ways in which fans consume music, and learn more about their cultural interests. Tools like Soundcharts are really useful to help you understand these insights.

You can then run Facebook and Instagram ads to target potential label fans more specifically.

How to Start a Record Label - artist performing to a live crowd

7. Build your label team 

Another key consideration of setting up a record label is whether or not you want to run things yourself or build a team. 

Do you already have the skills and network to set things up yourself? Or would it be better to partner up with someone like an existing music manager or promoter to split tasks with? 

Starting off solo might be rewarding, but can sometimes prove to be too much to balance once your artist roster starts growing.

Bringing on board someone with their own music industry connections can definitely help with tasks and create more buzz around your label, but you’ll also need to factor in lower payments due to splitting profits.

Just remember, whichever option you choose is entirely up to you and your personal goals for the label.

8. Sign your artists

Most A&R nowadays involves building relationships (both online and in-person) with artists. Keep up to date with who’s regularly making it onto Spotify playlists and which artists are making noise on social media.

The cool thing about running an independent label is that you can take your own risks and put faith in the artists that you believe in. Start by signing a couple of artists that you see potential in and work closely with them to build both your label and their careers.

How to Start a Record Label - signing a contract

9. Promote your acts

It’s no secret that online promotion is pivotal to success. Music marketing is bigger than ever and label owners need to know how to effectively promote their artist campaigns online in order to maximise streams and income. 

Learn more about promoting your music:

- How to promote on Instagram

- How to promote on TikTok

- How to promote on Twitter

- How to promote on YouTube

10. Build an album campaign

Now you’ve built your roster and started promoting everyone, you can begin working on your album release strategy.

Outline a realistic timeline with your artists, taking into account recording tasks, release dates and music marketing plan. 

Timing is crucial with this. Make sure you’re giving yourself enough time to upload music to Spotify and the other streaming platforms. 

Tip: Upload your artist’s music to Ditto at least 3-4 weeks before their release date.

You’ll need to continue promotional efforts post-release too, so make sure to update your artist campaigns with new timelines and media assets. 

11. Distribute music with Ditto

When your artists are ready to share your tracks with the world, you'll need to pick a digital distributor for them. All of this is made simple with a Ditto Labels plan. You’ll not only be able to release unlimited music to every platform, but you’ll be able to manage all of your artist’s royalties, arrange the necessary splits, and access record label extras. All from within your account. 

How to Start a Record Label - join Ditto Labels

With more artists choosing to avoid chasing major record deals, setting up an independent record label has never been as appealing or as straightforward.

You might not have access to the same levels of cash as the majors, but what you do have is a passionate community of independent artists at your side who can help you and your artists achieve global success and keep hold of your passion and creativity.

How to Start a Record Label in 2024

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