Forty years of Virgin: How Richard Branson’s eccentric record label changed the charts

It's four decades since Richard Branson set up the mail-order business that became a hippie haven, a punk paradise, and then a big-money label. Pierre Perrone tracks the story

It was nearly called Slipped Disc until Tessa Watts, a member of the team Richard Branson had assembled around him at Student magazine, pointed out they were all "complete virgins at business." So Virgin became the name of the company Branson started in 1970 to sell discounted and import records via mail-order. The following year, a postal strike nearly put him out of business and forced his hand. He opened his first Virgin Records shop at the cheaper end of London's Oxford Street, then another one in Liverpool. Twelve more would follow and become cool places to hang out for the alternative, hippie crowd who never felt at home in WH Smith.

Branson began thinking big. With a loan from bankers Coutts, he bought an Oxfordshire manor house he converted into a state-of-the-art residential recording studio, the first of its kind in the UK, known as The Manor.

There was a setback in May 1971 when Branson fell foul of HM Customs and Excise after failing to pay duty on several van-loads of records. He spent a night in jail, was bailed out by his mother and had to pay a hefty fine of £60,000. He also narrowly avoided a criminal record that would have put paid to his entrepreneurial ambitions and confirmed his Stowe School headmaster's prediction in 1967 that he would "either go to prison or become a millionaire". The second part of the statement would come true a few years later.

As Branson reveals in his autobiography Losing My Virginity, Simon Draper, Branson's music-mad South African cousin, the one who knew about Krautrock and kosmische musik, became his right-hand man. Together, they launched Virgin Music at the end of May 1973 with the simultaneous release of four albums: Mike Oldfield's Tubular Bells – catalogue number V 2001 – Flying Teapot (Radio Gnome Invisible Part 1) by space rockers Gong – V 2002 – a Manor Live jam-session album that was definitely of its time – V 2003 – and The Faust Tapes – VC 501 – an album by German sonic pioneers Faust, sold for the price of a single.

With its Roger Dean-designed "twins" logo, Virgin was a progressive rock label, the home of underground acts connected to the Canterbury scene like Robert Wyatt and Hatfield and the North. It championed German groups Tangerine Dream and Can, as well as mavericks like Kevin Coyne and Ivor Cutler and avant-rockers Henry Cow/Slapp Happy. It was really following in the footsteps of Chris Blackwell's Island, Tony Stratton-Smith's Charisma, and Chrysalis, the Chris Wright and Terry Ellis operation, but was even more leftfield, a boon to lovers of outsider rock.

Mind you, in 1975 Branson showed chutzpah when he tried to sign the Stones, an ambition he would realise 17 years later.

By 1977, the company was over-reliant on Oldfield but managed to ditch its hippie image with the master-stroke signing of The Sex Pistols. Virgin became the punk and post-punk label of choice for X-Ray Spex, Penetration, XTC, Magazine, Devo, The Skids, the Members, Ruts and Public Image Ltd. The company became a synth-pop powerhouse with the Human League, John Foxx and Orchestral Manoeuvres in the Dark as well as Simple Minds and Japan, two acts poached from Arista that went on to define the Eighties, along with Culture Club.

Having started the wonderful Front Line reggae imprint and welcomed UB40 and Scritti Politti, Virgin acquired Charisma and Genesis in 1983 and made world superstars of Phil Collins and Peter Gabriel. In the late Eighties, the label relaunched the career of Roy Orbison, gave Steve Winwood his biggest album and helped Soul II Soul conquer America. After signing Janet Jackson to a worldwide deal, Branson reluctantly sold Virgin Music to EMI for £510m in 1992. That was the only way he could raise the finance to keep his Virgin Atlantic airline afloat against fierce competition from British Airways. Following Universal's acquisition of EMI, Virgin is now part of the biggest music company in the world.

Indeed, Universal has just launched a Virgin40 campaign entitled "40 Years Of Disruption". It packages post-Branson signings like Massive Attack, the Spice Girls, Daft Punk and Emelie Sandé together with the label's first two decades, and promises an exhibition, a coffee-table book, a documentary as well as compilations and live events. Its usage of a photo of the late Sid Vicious and Nancy Spungen, punk's tragic cartoon couple, does emphasize the disruption angle but is emblematic of the rewriting of pop history. Virgin is no longer the hippest place to be.

Branson's best: A virgin top ten

Mike Oldfield

The precocious multi-instrumentalist wasn't even 17 when he began working with Kevin Ayers in 1970. Two years later, his demo of 'Tubular Bells' caught Branson's ear. He gave him carte blanche to complete the project at The Manor. The spellbinding album went on to eerily soundtrack 'The Exorcist' and sell more than 15 million copies. Branson has named two Vrgin Atlantic planes 'Tubular Belle' and recently referenced the album in Virgin Media and Money adverts.

Gong

The 1974 budget release of 'Camembert Electrique' prompted many to take a punt on the teapot-obsessed psychedelic group founded by Australian Daevid Allen, an original member of Soft Machine. Guitarist Steve Hillage went on to produce Simple Minds and collaborate with The Orb. He now leads ambient dance project System 7.

Sex Pistols

Dropped by EMI and A&M, the punk rockers were running out of labels until Virgin came to the rescue and issued their epochal 'God Save The Queen', the alternative Jubilee anthem, in May 1977. The furore around the group's album 'Never Mind The Bollocks' helped Virgin reposition itself. John Lydon's Public Image Ltd and Pistols manager Malcolm McLaren continued to work with Branson into the Eighties.

Magazine

Led by the enigmatic Howard Devoto, the former Buzzcocks frontman, the 'Shot By Both Sides' post-punk group released four seminal studio albums on Virgin and influenced Morrissey, Simple Minds and Radiohead. Its members later found success with Visage, Siouxsie and the Banshees, and Swing Out Sister. They reformed in 2009.

XTC

Swindon's answer to the Beatles, the new-wave group were set to follow Squeeze and The Police into the mainstream until Andy Partridge was overwhelmed by stage-fright in 1982. Virgin persevered, indulging their psychedelic alter-ego The Dukes of Stratosphear but they went on strike over their contract in 1992.

The Human League

A decidedly oddball proposition that David Bowie declared "the future of pop music", the original electronic quartet splintered in May 1980. Ian Craig Marsh and Martyn Ware formed Heaven 17 while frontman Phil Oakey, he of the lopsided hair and distinctive baritone, recruited two teenage girls. With the help of producer Martin Rushent, they made the definitive synth-pop album 'Dare' and topped the charts with 'Don't You Want Me' at Christmas 1981. They're still going.

Culture Club

Fronted by the flamboyant Boy George, a former cloakroom attendant at London's New Romantic haunt The Blitz, the quartet took three singles to catch fire until the light reggae of 'Do You Really Want To Hurt Me?' reached No 1 in 1982. The band led the new British invasion of the US charts in the early Eighties alongside Duran Duran.

RIP Rig + Panic

A short-lived, post-punk jazz ensemble formed by two ex-members of the incendiary, radical The Pop Group, they appeared on 'The Young Ones' sitcom in 1982. Best remembered as the launchpad for vocalist Neneh Cherry, of 'Buffalo Stance', fame, whose 1989 album 'Raw Like Sushi' paved the way for the Bristol collective Massive Attack.

Soul II Soul

Given Virgin's championing of reggae and of the British soul trio Loose Ends in the mid-Eighties, the label was the perfect home for Jazzie B's sound system-originated outfit. Voiced by Caron Wheeler, 'Keep On Movin' and 'Back To Life' sound-tracked the summer of 1989 and topped the US R&B charts. Awarded the OBE in 2008, Jazzie B is still gigging.

Mary Margaret O'Hara

Not to be confused with Mary O'Hara, the former nun harpist and soprano signed to Chrysalis in the Seventies, the Canadian singer-songwriter issued the bewitching 'Miss America' on Virgin in 1988. Sounding like a female harbinger of Jeff Buckley, she enthralled Morrissey and Michael Stipe. Her sole release since a Christmas EP in 1991 has been the soundtrack of a film she acted in.

Soul II Soul and the Human League appear at next weekend's Wychwood Festival (wychwoodfestival.com)