Inside Kato’s Private Briefing With Spotify: What Indie Artists Need to Know

In a rare behind-the-scenes look at how Spotify engages with creators, producer-entrepreneur Kato the Producer joined the No Labels Necessary podcast to break down the myths, misconceptions, and meaningful takeaways from his private sit-down with Spotify’s head of marketing and policy. The result was a wide-ranging, nuanced conversation that held up a mirror to the realities of being an independent artist today.

A Seat at The Table

Kato recently flew to Spotify’s headquarters to join a small group of music influencers for a private briefing tied to the company’s latest Loud & Clear report—a yearly attempt at platform transparency, breaking down royalty distributions, user metrics, and creator earnings.

“They invited me out there with a bunch of like a handful of other music influencers,” Kato told hosts Sean and Corey. “I was maybe one of 20, and they gave us the whole tour of the Spotify offices… Then they reserved one of their podcast rooms for me to sit down with Sam [head of marketing and policy] and interview him for an hour.”

What Kato came back with was more than just soundbites. It was a refreshed perspective on the role Spotify plays—and doesn’t play—in an artist’s financial well-being.

Misplaced Rage and Misunderstood Ecosystems

Kato was quick to call out what he sees as a dangerous trend among indie creators: blaming Spotify for financial instability without considering the full picture.

“I really don't think Spotify is the issue,” he said. “They are just one piece of the ecosystem… They are not the reason you're not able to make a living as an independent artist.”

This sentiment sparked a broader conversation about artist anger, which Kato believes is often directed at the wrong target. “Be mad at yourself that you’re not focusing on the right things,” he said. “The problem is the artists just don’t want to do the work.”

Sean echoed this energy, emphasizing that many artists are more committed to the idea of independence than actually building the infrastructure to support it. “They’re promoting this indie thing,” he said, “but you're not taking advantage of any of the indie benefits. You just want to be the same thing with more control.”

Direct-to-Consumer or Don’t Bother

For Kato, the alternative is clear: building a direct-to-consumer (D2C) business is not just smart—it’s essential.

“If you are not building a D2C business where you can go direct to your fans and your audience, you're missing out on the biggest piece of being an independent artist,” he said. “You gotta do your job as an artist to build your own community so that you can access your super fans.”

He pointed out that D2C doesn’t just offer creative freedom—it offers financial freedom, too. “If a thousand of your super fans are paying $100 each,” Kato noted, “that’s $100,000. So you're not tripping over fractions of a penny that Spotify is paying you.”

The Streaming Economy, Explained

One of the major points of friction in the artist community is Spotify’s per-stream payouts, which often amount to a fraction of a penny. But Kato came away from the Spotify meeting understanding how the company’s subscription-based business model shapes that reality.

“They charge a flat fee for their users to be able to have access to the entire world’s music catalog,” he said. “Is it a great system for music creators? No. But again, that's just one piece of it.”

He added that trying to compare Spotify royalties to what a super fan would pay misses the mark. “Music and art has no fixed price. It’s worth whatever people are willing to pay for it.”

From his perspective, Spotify is like Netflix—a convenient product for the consumer, not necessarily a robust income stream for the creator. “As a consumer, I love it,” Kato said. “I have access to all the music I want for $10 a month.”

Understanding Value Beyond Vanity Metrics

Another key moment in the episode came when Kato addressed the obsession with vanity metrics, particularly Spotify’s monthly listener counts.

“That is a vanity metric,” he explained. “It has no reflection of your core community or your true fans. It’s basically just what your monthly impressions are on Instagram.”

He pointed out that artists chasing those numbers are often chasing the wrong kind of success—fame, not sustainability.

“You have at least 10 fans who are probably willing to pay you 10x what a Spotify stream is worth,” he said. “And you’re spending all your time trying to figure out why the platform’s not giving you more.”

The Indie Illusion

Kato also challenged the perception that independence equals ease. For many, it’s the opposite.

“Being an independent artist is like showing up to a basketball game with a golf club and trying to change the rules,” he said. “That game wasn’t built for you.”

Instead, he urged artists to recognize that the true indie game requires building a business from the ground up—and that’s hard work. “The harsh truth is that most artists just want stability, not fame,” he said. “They just want to make $60,000 to $100,000 a year doing what they love.”

The Broader Context

Throughout the conversation, the No Labels team made a point to keep things in perspective. They compared the size of the music industry to other sectors like food and retail, highlighting that UMG’s $40 billion valuation pales in comparison to McDonald’s $240 billion.

“If there's less money being made,” Sean said, “then you're going to have less investment. Everybody’s impacted by that same thing in the industry.”

Kato agreed, noting that “the internet messed that up”—eliminating gatekeepers but also lowering the floor on what many creators earn.

Still Playing the Game

Despite his critiques, Kato continues to use Spotify and views it as a necessary part of a modern music career—just not the most important part.

“I’ve made millions off cultivating my own community,” he said. “But I still have my music on Spotify because I think it’s a great way to reach people.”

In other words: artists don’t have to choose between streaming and sustainability. They just need to understand which is which—and act accordingly.