Launched in 1992 Madhouse Records Inc was a joint venture between US DJ and producer Kerri Chandler and Mel Medalieís Champion Records. Mel met Kerri on a trip to the US whilst visiting Todd Terry at Idlerís Studio in Brooklyn (whose Royal House project was later released on Champion).
Madhouse became predominantly an outlet for Kerriís music, as well as tracks from his producer friends as well as tracks he came across through his extensive DJ experience. The sound of the label was rooted in Deep and Soulful House, some instrumentals but on the whole full vocal tracks.
The first release on the label was a 6-track sampler entitled ďA Basement, A Red Light & A FeeliníĒ which showcased some of the artists and releases to come, and sold in excess of 100,000 copies on vinyl alone.