Vancouver-based dance label Monstercat perfects a new business model

Lotusland might not have the nightlife of a bigger city, but label CEO Mike Darlington is looking ahead.

    1 of 1 2 of 1

      Remember when the record industry declared it was dying? That no one buys music? That Internet streaming and peer-to-peer file-sharing reserved you a spot in the seventh circle of hell?

      It’s time you heard of Monstercat.

      The Vancouver-based dance label is only four years old, but already boasts well over one million paid downloads and 15 No. 1 chart-toppers on iTunes. Initially founded in 2011 as a YouTube channel, Monstercat has, from the outset, challenged record-industry practices. Staunchly dedicated to streaming its tracks for free alongside digital downloads, Monstercat defies the music business’s fears of piracy. Four million followers later, the label continues to revolutionize the record industry—and it’s all happening from our city.

      Lacking the cachet of club hubs like Toronto and Montreal, Vancouver seems an incongruous place for founders Mike Darlington (CEO) and Ari Paunonen (COO) to take on the major players of the dance business. The Economist, if you’ll recall, recently branded Vancouver “mind-numbingly boring”. But the city is central to the company’s ethos.

      “Vancouver definitely has a very vibrant arts and cultural scene, and there’s a lot of creative people pushing to do things differently,” Darlington declares, on the phone from Monstercat’s Railtown headquarters. “For us as a company, the move from Ontario was just as much of a business decision as a lifestyle decision. We wanted to experience something different, to do things outdoors. It’s so much more important to us to be in a place that inspires creativity.”

      Creative is exactly the right word for the company.

      Rather than funnel money into promoting an artist, Monstercat markets itself as the brand and signs bands for single tracks only. With an energetic schedule of three new releases a week, Monstercat has created a solid community of international fans whose devotion is to the label.

      Alongside conventional downloads, Monstercat offers subscriptions to its catalogue. This licence allows individuals on YouTube and Twitch to use the label’s songs in their videos without breaching copyright laws—meaning that subscribers can monetize their content, and Monstercat has a stable revenue stream. A win-win for Monstercat and its supporters—and a loss for the major labels, whose market share evaporates as more companies adopt Monstercat’s innovations. “It’s about shifting the model,” Darlington says.

      But while Monstercat’s groundbreaking formula is great for digital revenue, touring is tougher. A large percentage of the label’s audience is underage. Its online community is scattered all over the globe, and its devotees invest in a roster of tracks rather than artists.

      A tricky situation, especially for a dance label. Never one to shy from a challenge, Monstercat launched an ambitious 23-date flagship North American tour last year. The Uncaged showcase featured Euro-circuit electronica darlings Pegboard Nerds and relied on a democratic vote to determine which cities would play host. Ticket sales were hot, with midsize venues packed, but Canadian shows were few and far between, with Uncaged touching down in just Toronto and Ottawa.

      Nonetheless, Darlington is keen to point out that Monstercat is not just a global brand, but a resolutely Canadian company. “I definitely want to do more Canadian dates in the future. We could have moved the company a long time ago to L.A. or New York, where everyone was egging us to go. We stayed in Canada because we’re proud of our country, we’re proud of what we’re developing on a national scale. I want to keep growing it up and see where we can take it.”

      And that spirit extends to Vancouver. As Monstercat’s influence continues to swell, the city takes centre stage. Not only is Vancouver swiftly becoming the epicentre of an industry overhaul, Monstercat is out to help reshape Lotusland’s live-music scene.

      “Make sure I’m not quoted saying the nightlife here is bad! It’s not bad—there’s just not as many people actively going out to nightclubs in Vancouver,” Darlington says with a laugh. “The people that do the shows here do an incredible job, but there’s just less people in the city than somewhere like Toronto. Less people go to shows regularly, especially in the nightclub scene. Which makes it a bit more limited.”

      But Monstercat is set to shake things up. “Obviously, Vancouver is a city we’re going to be paying really close attention to, because this is our hometown. It’s something that I want to develop—a strong community of people right here.”

      Darlington has a clear vision for Vancouver. “I’m not going to be a promoter and start putting on shows, but I’m definitely looking to do more collaborative work with people like [local EDM and rock promoters] Blueprint,” he says. “We’re going to continue to work closely with them in 2016. Doing one-off shows is great for our artists. We curate the night for a particular performer, and showcase a lot of our different guys as they start to develop their careers.”

      As Monstercat’s brand blossoms on the international stage, gathering new global followers every day, Darlington refuses to leave Vancouver behind.

      “There’s more to come here,” he promises.