Why Small Independent Venues are the Lifeblood of the Modern Music Industry

The musicians who made up the headlining acts at festivals this summer didn’t magically materialise from the ether. They spent years driving hundreds of miles to play to a dozen-of-their-mates-and-the-bar-staff, to sticky-floored rooms, to bombing their sets, to locking themselves away and scrimping and saving to pay for somewhere to rehearse, to testing their ideas out on live audiences early on, to realising who they were on stage. That process has a home, and it’s not a 20,000-capacity arena. It’s the small independent venue down the road, the one that might not make it through the next rent review.

Niche Culture Needs Protected Space

Corporate-owned venues generally have an appetite for risk and book artists who have already proved in some way; artists with broad popular appeal, because they can’t show a loss to the shareholders. None of this is particularly controversial. They’re businesses, that’s how businesses operate.

The upshot is that scenes associated with a genre that are too early in their development to demonstrate viability on a spreadsheet do not get to play on big stages. Whether it’s a regional jazz fusion, a post-punk revival, or something so new it doesn’t even have a genre name yet, this kind of music has its first fans at small independent venues.

Live Music in Bristol provides a great illustration of what happens when a city gets this right. Bristol’s independent scene has consistently produced artists, movements, and entire genres that only later arrived on a national stage. That’s not coincidence, it’s the product of a circuit of small venues that gave musicians room to develop without commercial pressure to perform on command.

For example, the Agent of Change principle does exactly that; it protects the spaces in which new scenes are incubated. It does so by requiring that, when a new residential development is constructed immediately adjacent to an existing music venue, it’s the developer that must spend the money on soundproofing, not the existing music venue. Without protections like this, the low profit margins inherent in music venues leave them incredibly exposed to redevelopment pressure, even when it’s the value of the surrounding cultural infrastructure they create that is going up.

Small Venues Are the Industry’s R&D Department

Grassroots music venues play a crucial role in the music industry by supporting emerging artists. They provide a non-committal environment for artists to test their music, performance, and audience reception. New talents are given the opportunity to assess which areas need improvement and what can be appreciated. This is an essential step in the process of developing a successful act.

The Economic Case Isn’t Soft

Local economies are boosted by independent venues. For instance, when 200 individuals attend a show on a Tuesday night, most of them will eat locally, drink before or after, and some of them will be travelers who need lodging. This has a ripple effect on restaurants, pubs, taxis, and hotels, which goes beyond the ticket revenue of the venue.

According to the Music Venue Trust’s 2023 Annual Report, grassroots music venues contribute more than £500 million to the UK economy, with an average profit margin of only 0.5%. The businesses benefitting from the footfall do not share the operational fees or the licensing burden. The venue has to cover it all.

Let’s consider merchandise. For a new artist, one evening of merchandise sales at a show with a capacity of 200 can be quite a significant part of their monthly earnings. It’s more lucrative per person than the income generated by thousands of streams. Nonetheless, this would not be possible if people did not leave their homes to come and see the artist.

The Touring Circuit Matters More Now, Not Less

Streaming has changed how artists make a living. Revenue from recorded music no longer pays its way as artists try to gain a foothold in the industry, as physical sales once partially did. Rather, for all but the most successful acts, recorded music is essentially a promotional tool, a way to get people out to shows. That’s not a new story, but the album/tour model used to at least support itself. Now, it doesn’t. The cost of touring, meanwhile, has skyrocketed: fuel, accommodation, crew, van hire. That money has to come from somewhere. The answer can’t be abandoning regional touring as a career incubator. It has to be finding ways to make it possible.

A healthy domestic circuit of grassroots venues in cities and towns lets an act play support at touring artists’ shows, then host them in return. It lets them slowly build a compelling story and real audience in their own room before they risk the considerable expense of heading out to play a longer string of shows. It lets them get good enough to be worth watching.

If the rooms close, the circuit breaks. Instead of being loss leaders, shows become short-sighted plays to minimize loss. The many smaller towns and cities outside a country’s major population centers, suddenly alleged to be the cause of their own missed opportunities to see live music, stop getting visited by good small to mid-tier acts. The pipeline dries up at its thinnest point, and eventually, so do the headliners.