I'd say this is only partially true. These days labels are not, and I would argue should not be the artists' primary target for income. Touring and new media are things artists have control over to a much larger extent and that's where artists should be focused.
If a good independent label wants to pick you up, like say Bella Union or Merge or Sub Pop (still) or the like then go for it, it might help. Or it might not. For some it's a big deal, but mostly in terms of promotion and profile, better tours. The good labels, like Bella Union, get very involved in that side of it, others not so much. Even then those lucky acts that are on good labels are still primarily touring bands, and downloads and sales and royalties are a small percentage of their income, unless something really breaks on radio, and that my friend is whole other ballgame and extremely rare from the average artists' perspective. Better to hope to get on a TV show or film, raise your profile some and get better tours.
Also, most of the time those higher-profile independent labels came along and were interested because those acts already had something going, some sales, regional numbers or whatnot that made the label relationship more like a partnership.
It helps to go into it from a position of strength, where you know you can walk away. And if you can walk away, you might not even need the Independent label. Mostly you need good management and good promotion to get better tour numbers going, build into a position of strength and really think about what means of income are available to you in an age where access to distribution channels (the primary former attraction of labels) are now available to virtually everyone.
That's the same as startup getting investment because they have "traction", and most won't if they don't. And the benefit of having a label is that, while you don't need one to tour and focus on new media, it sure as hell helps to have professional help from people who have done this countless times. There are thousands of independent labels. Some will do nothing for you. Those that do their job can do things that a fraction of 1% of artists can do on their own. Nobody should sit around waiting for a label, but nobody who knows what a good label can do would say they're not extremely valuable and worth signing over some of your "equity" to.
This is all true, and it's important to distinguish between "The Industry" and the good indie labels. Bella Union is one I have first-hand knowledge of and they are incredibly fair, and involved in the artists' tours and PR to a large degree.
If you know that's the kind of label you're looking at signing with, great! But the idea that labels are gatekeepers to distribution and royalties is a thing of the past.
Labels work best now when they act more like YC and less like RCA.
If a good independent label wants to pick you up, like say Bella Union or Merge or Sub Pop (still) or the like then go for it, it might help. Or it might not. For some it's a big deal, but mostly in terms of promotion and profile, better tours. The good labels, like Bella Union, get very involved in that side of it, others not so much. Even then those lucky acts that are on good labels are still primarily touring bands, and downloads and sales and royalties are a small percentage of their income, unless something really breaks on radio, and that my friend is whole other ballgame and extremely rare from the average artists' perspective. Better to hope to get on a TV show or film, raise your profile some and get better tours.
Also, most of the time those higher-profile independent labels came along and were interested because those acts already had something going, some sales, regional numbers or whatnot that made the label relationship more like a partnership.
It helps to go into it from a position of strength, where you know you can walk away. And if you can walk away, you might not even need the Independent label. Mostly you need good management and good promotion to get better tour numbers going, build into a position of strength and really think about what means of income are available to you in an age where access to distribution channels (the primary former attraction of labels) are now available to virtually everyone.