Dunmore has pulled off an enviable trick, not only building his own businesses but helping it to thrive in an industry that has been completely turned upside down.
The 50-year old has spent most of his life in the music business in one way or another. He began DJ-ing soul and funk aged 21 — “as a good way of meeting girls” — before working his way up through record shops, promoting, working at Cooltempo Records and eventually, in 1994 running AM:PM, the dance division of A&M Records.
In 1998, however, Universal bought A&M’s owner Polygram and merged the label with Island records. Dunmore saw it as “a watershed moment” and decided to leave to set up his own company. “I decided if I was going to be a failure or a success it would be on my own terms”, he remembers.
Dunmore struck a deal with Ministry of Sound and in 1999 they lent Dunmore £200,000 to start Defected. “We were supposed to provide the repertoire, they were supposed to provide certain back-end facilities.”
However, the relationship soon went south. “They didn’t really hold up their end of the bargain,” says Dunmore. Without Ministry of Sound’s administrative help, Defected soon ran into “cash-flow problems, accountancy problems, disciplinary problems, human resource problems.”
Defected finally parted company with Ministry of Sound in 2001, by which time it owed more than £500,000. Dunmore hired consultants to deal with the mounting problems and managed to rescue the business.
At the same time the industry transformed. “The advances you were paying to acquire [music] rights went from being very manageable to astronomical”, recalls Dunmore. “Records we might have offered £5000 to, Ministry would offer £50,000 for because they didn’t want the majors to have it. The value of music went a bit like football.”
Defected was forced to adopt a new approach. “We started to sign artists at a much lower level and try to grow them organically, which in hindsight was probably the best thing we ever decided to do.”
Dunmore’s willingness to reinvent the business helped when the internet began to disrupt the music industry by the mid-2000s.
“We had to make the transition from a physical record label to a digital record label”, Dunmore explains. Unlike most in his position, however, Dunmore evangelises on the benefits.
“You don’t have the problems of excess manufacturing, excess print, faulty goods — all the things that would hit us in the head, those problems don’t exist any more.”
He counts Steve Jobs as one of his idols and says iTunes has been “an incredible thing for the music industry”. “Every time they open a store it’s an extra layer of income for us. And everything’s already uploaded.”
He admits, however, that sales have been hit. They used to account for 90% of the business but now contribute only 60%. Defected has diversified to make up the difference, now offering merchandise, DJ management and copyright administration.
In addition to the 12 artists signed to Defected, the label has a catalogue of around 2200 recordings and 1800 song copyrights. Several of the songs it signed in its first few years are still licensed to compilations around the world each year, including Defected’s first release — SoulSearchers’ I Can’t Get Enough.
Defected’s club nights at Ministry of Sound also draw revellers in their thousands. Dunmore says the two businesses are now “frenemies” and adds: “It was a little bit tetchy when we parted company, but at the end of the day we realised we’re good for each other.”
This year Defected begins celebrations for its 15th year in business, culminating in a huge party on January 1 next year — the date of its founding. “I think the most important thing in music these days is you should stand for something”, says Dunmore. “If you stand for something and you’re consistent, the community will come to you.” Defected Records
Staff: 23; five consultants
Turnover: £4.5 million
Business idol: Mark Finkelstein [boss of Nineties record label Strictly Rhythm]: “He always said, ‘You’ve got to own your catalogue, you’ve got to have global rights and you’ve got to have long-term rights if you want it to be a long-term business.’”