"Have you heard this?"

On a recent Tuesday afternoon, Matt Sullivan and Josh Wright excitedly ask this question often while giving a visitor a tour of Light in the Attic's Fremont-based warehouse/office space. As they peruse the records and CDs on the shelves here, they really are proverbial kids in a candy shop, picking out titles and proclaiming their greatness with hints of awe in their voices.

But these über–record nerds not only built the candy shop, they supplied it with the high-quality goods about which they're raving. Light in the Attic's co-owners make the music industry—which we keep hearing is on its deathbed—seem like incredible fun... and even kind of profitable.

The incessant squeak and slap of tape guns securing boxes full of merchandise in the warehouse attests to LITA's brisk business, which includes 20 international labels that it distributes and the stock of LITA subsidiaries Modern Classics, Future Days, and Cinewax. Warehouse manager Heather Whittington and her interns' packaging maneuvers cause an insistent rhythm that some enterprising producer should sample and build a track out of, as a tribute to an underdog indie label thriving in a hostile economic climate for music retail.

Celebrating its 10th anniversary this month, LITA has never been more financially robust.Surprisingly for a company that most perceive to be a boutique vinyl label, LITA sells more CDs than wax (about 75 percent to 15 percent), and its digital sales account for only about 10 percent of business.

"When it comes to vinyl," Wright says, "every single year, we've probably increased 20 to 30 percent the quantity of vinyl sales. Every year in the business, we've increased sales in general.

"The folks who are buying our stuff actually like to have something tangible in their hands," Wright continues. "Our releases, it's usually more than just the music. There's usually a big story behind everything, and it's something you want to have."

Truth. LITA's lavish packaging includes extensive liner notes (full disclosure: I wrote the ones for Donnie and Joe Emerson's Dreamin' Wild), photos galore, thick vinyl, and high-quality covers.

"The packaging should reflect the sound and, as best you can, give the experience of a visual accompaniment to the music," Sullivan says. "In a lot of ways, our reissues are like a coffee-table book."

Light in the Attic's attention to detail and aesthetic excellence were apparent from its 2002 debut release: a double CD of the Last Poets' first two albums, The Last Poets and This Is Madness. That is known as entering the marketplace with huge balls. The Last Poets were one of the most incendiary groups ever, early-'70s forerunners of rap, strident linguistic wizards who were as tough on black folks as they were on the white power structure.

Sullivan, then 26, was living in a small two-bedroom apartment in Fremont. He had interned with a label called Vampisoul during a six-month period while living in Spain, and through this connection, he leveraged the release of The Last Poets/This Is Madness.

"My memory of it was sitting in this basement for eight months and obsessing over every little thing," Sullivan remembers with a laugh. "It was a good experience. We were like we are now: obsessed with every little facet of a release. Who's going to write the liner notes, what's the sticker tag going to say? I don't know if anybody reads this shit, but for us, it's really important."

Sullivan, who'd interned at the Sub Pop and Loosegroove labels, lucked out when a mutual friend linked him up with Scott Webber, a skilled designer who'd been canned by Virgin Records. "It's funny how it took eight months for one record, but I didn't know what the hell I was doing," Sullivan says, chuckling. "One of the reasons it took [that long] to finish is I was so concerned that it had to be perfect. That's always been our outlook on things. We'll sit on a record for years until it's done right. We hardly sold any of those records, and I gave so many away."

Impressively, Sullivan coaxed Public Enemy's Professor Griff and Saul Williams to write liner notes for the Last Poets reissue. It was an auspicious beginning, and Wright would join the company soon after.

The 36-year-old Wright is the pragmatic business mind of LITA. He's in charge of retail/sales and rules the Seattle office. Sullivan is the creative dreamer and main A&R operative (Pat Thomas—who helmed reissues by Michael Chapman and curated the Listen, Whitey! compilation—helps out with this task, too). Sullivan works from Los Angeles, which facilitates dealings with the major labels. Altogether, LITA employs a mere eight people full-time, including the owners. Everyone does multiple tasks. Sometimes the office dog has to make the coffee.

At any given time, LITA has about three dozen projects in progress. Many take several years to come to fruition; Kris Kristofferson's Please Don't Tell Me How the Story Ends took seven, and the massive Lee Hazlewood back-catalog excavation has been nearly a decade in the making. Much of Sullivan's day involves wrangling the legal minutiae of copyrights and dealing with musical rights holders. He also engages in the difficult sleuth work of tracking down artists who've long been out of the spotlight—or who never made a ripple in the industry, but created phenomenal music that must be heard.

Sullivan recounts several frustrating encounters with major-label drones who take forever to return calls and e-mails and who don't even realize the sonic gold mines that sit neglected in their archives. LITA is trying to unearth these gems and give the owners money, yet they still meet inertia and resistance. No wonder the majors are circling the drain.

A degree of LITA's success derives from having savvy record-collector allies who alert them to amazing obscurities. DJ Supreme La Rock clued LITA in to Seattle's fertile soul scene of the '60s and '70s, resulting in the Wheedle's Groove compilation and documentary. Kevin Howes similarly hipped LITA to Toronto's subterranean Jamaican music scene, culminating in the Jamaica to Toronto comp and releases by Jackie Mittoo, Noel Ellis, and Wayne McGhie. Zach Cowie did LITA a solid by curating the self-explanatory and excellent Country Funk compendium.

Sullivan and Wright's golden ears have led to a catalog that's both diverse (records by Serge Gainsbourg, Monks, the Black Angels, Annette Peacock, Karen Dalton, Thin Lizzy, Betty Davis, the Saturday Knights, and the Free Design just scratch the surface of its range) and devoid of duds.

But besides rescuing fantastic aural documents from oblivion, LITA also sometimes resurrects careers and does wonders for artists and their families' morale and financial situations. Jim Sullivan, auteur of the heart-wrenching loner-psych-folk anomaly U.F.O., disappeared in the New Mexico desert in 1975; LITA's reissue gave an emotional boost to his family—and led to an hour-long segment on Art Bell's supernatural-fixated Coast to Coast AM radio show.

The most spectacular example is Rodriguez, the Detroit troubadour whose 1970 LP Cold Fact is Sullivan's favorite label release. Through persistence and charisma, LITA's bosses coaxed the reclusive singer-songwriter out of his shell and got him to tour in 2009, turning on thousands of new fans to his urban, surreal folk rock. The Searching for Sugar Man documentary and appearances on The Late Show with David Letterman and 60 Minutes validated all of LITA's hard work... but in none of these high-profile media incursions did Light in the Attic get props.

But LITA's heads don't have time to dwell on slights. They're too busy scheming about future releases. Sullivan says they're "working on projects that won't be out till late 2013 or 2014... or maybe even 2016." On the horizon are a 7-inch series featuring contemporary musicians covering LITA classics, a boxed set of 11 Hazlewood 45s coming out on Black Friday, a double-vinyl reissue of D'Angelo's Voodoo on Modern Classics in December, and four 1970s gems from Brazilian star Marcos Valle in early 2013.

Sullivan sums up LITA's MO with a sincerity and altruism rare in the music biz. "A lot of people are pioneers. They put themselves out on a limb to do these records. Those are a lot of the records I gravitate toward. These artists have really struggled and sacrificed and slaved away, and the system or whatever else failed them. Serge and Thin Lizzy obviously had careers, but most of these people, things didn't go as planned. I think, 'God, I'd cut off my arms to work with this or release this. It's the best thing ever.'"