"I basically went into a number of studios in Brooklyn, New Orleans and Detroit and recorded a bunch of music that I wrote myself, from ambient piano music to a full band with horn sections and singers, and then all that music was taken from the tape and pressed to vinyl, so I've essentially created a crate of records so I can sample myself," he laughs.
"So I'm sampling and cutting up everything from there, so it still sounds like sample-based hip-hop electronic music but I made it all myself."
Have you ever met a bigger music geek? But you have to admire the guy's passion - and Smith is such a likeable, down-to-earth guy as he describes his goal to fuse everything from "1940s French film soundtracks" and 70s Brazilian funk to bog-standard blues and folk music into one cohesive whole.
And rest assured, if his previous music is anything to go by, he will come up with songs that get your head nodding, make your limbs go all liquidy, and then boot you in the bum to get your groove on.
"It's hip-hop, down-tempo, but in a banging 2013 dancing style. I just want to inspire people to commit to making original music and evolving music in general," he says of the new album, which includes a guest spot from legendary New York rapper Nas.
"We met and we really connected and he really wanted to rap on one of these tracks I had and he was saying, 'man, these tracks are so dope, it's like early 90s but so 2012'."
Another thing that makes Smith unique is the fact he has given away most of his music - or asked for a donation - for the past six years. He started offering free downloads of the first Pretty Lights album, Taking Up Your Precious Time, in 2006. He based it simply on the premise that he wanted people to be able to get his music easily so it would spread by word of mouth.
He was ahead of his time in this regard. "People say, 'oh, you copied Radiohead ...' Ah, no, I actually did that first," he says of the British band's 2007 release In Rainbows which you could buy on a "pay what you want" deal.
Though the first album uptake was good, when second album, Filling Up the City Skies, came out in 2008 the download rate went from 200 downloads a month to more than 10,000.
"I only realised it was working when I played my first show outside of Colorado and it was sold out. I thought, 'you know what, this f****** works'. So at that point I continued to give my music away for free because it helped build up my live show and gain more momentum."
These days his smallest live shows in the US draw 3000 and his biggest around 10,000. So Smith is doing okay, although with the upcoming release of the new album he is trying to figure out how to make a bit of money from it.
"I'm kind of still in the process of [working out] how I'm going to move forward," he ponders. "I don't want to stop what I've been doing for the last six years, but I want to be creative about how I release this record.
"If you can, I would encourage you to purchase this next one, but," he says with a laugh, "if you can't then I'm still going to make it available for free."
Who: Pretty Lights, real name Derek Smith
What: Liquidy, dancey down-tempo hip-hop
Where and when: The Studio, K Rd, Auckland, tonight
Listen: Go to prettylightsmusic.com to hear more and download tracks
- TimeOut