The American Record Company (commonly abbreviated as "ARCo") was founded by Ellsworth A. Hawthorne and Horace Sheble, formerly designers of accessories for Edison Records machines at their Philadelphia-based bicycle shop; in a previous venture, they had issued a small run of brown-wax cylinders in the mid-1890s.

[1] Hawthorne and Sheble partnered with John O. Prescott, whose brother Frederick worked with International Talking Machine in Berlin, which marketed Odeon Records.

The new company was based in Springfield, Massachusetts, though they maintained factories in Bridgeport, CT and Philadelphia; recordings were made in a studio in New York City.

[2] The label of the discs featured artwork depicting a Native American with a smoking pipe listening to a front-mount disc phonograph of undetermined manufacture; American Record Company advertising commonly marketed them as "Indian Records".

Other performers were mainly drawn from the ranks of singers that worked for Victor, Columbia and the cylinder companies, recording many of the same songs that they did elsewhere.