4 freelance engineers joining together to start small studio

[FlyMordecai]

Firstly, pardon my wordiness! I've put quite a bit of thought into this and would love some outside opinions and thoughts from some likeminded and more experienced people.

I've been collaborating with three other guys that are in the same boat as me and I'm thinking of pitching an idea to them. All of us as individuals are doing okay but are all wanting to step our game up a bit. We all have our respective rigs made up of decent gear that we've all been relatively successful freelancing with, whether it's tracking, mixing, production, whatever. However, none of us have a decent space to work in right now and we can't individually afford to rent or own a dedicated place so we end up working in terrible rooms, on headphones, etc. Assuming that when we combine our gear, experience and clientele we will have what we need, what's the best way to keep track of and divvy up bills and, hopefully, eventually profits? My initial thought is to put pen to paper and figure out our expenses and from that deduce a rate the studio will require to pay all the bills if its in use X hours per month. Each engineer charges a minimum of the agreed "room rate" which goes to rent, utilities, maintenance, etc. Each person charges whatever they want on top of the "room rate" that goes directly into their pocket. Again, I know this is all assuming a lot of very important details/finances we would have to work out but that's up to us to figure out and decide if it's realistic. The other immediate issue is the gear. Cumulatively we have a fairly respectable collection but two of us have much more than the two others. How should we address this? I suppose we could calculate each persons gear into the room rate and a percentage of the room rate goes to each individual for the use of their gear. Of course that would drive the room rate up and potentially beyond the point of affordability.

From what I've brainstormed, this model is pretty fair. The guys contributing more gear get paid for it while the others get access to gear they couldn't otherwise afford. The more you work the more you pay the room but the more you also put in your pocket.

Keep in mind none of us are quitting our day jobs and don't intend to get rich from this. If it takes off and becomes something, great! If it just serves as a place to make good music and enjoy the process, awesome. I tend to over-think things, as you can probably tell, but I want to be strategic about this to give it the best chance of working out and being fair for everyone.

[AstralPStudios]

The best way to make all of this happen and figured out comes from writing a business plan and that's the most practical answer I can give you.

You'll also need to come up with a studio name, location, you'll need to know your zoning, incorporate, market, etc, etc...

You need to figure out your finances as well and a decent sounding room is going to be upwards of 80k+ if you do acoustics yourselves you might be able to shave off a little more.

My initial thought is to put pen to paper and figure out our expenses and from that deduce a rate the studio will require to pay all the bills if its in use X hours per month.

Find your location and then say that because whether you have anything in use or not, your bill is going to be pretty gnarly on power in a commercial setting as well as utilities. Add rent to that which is going to be anywhere from 1200 to 4k alone per month depending on your area/square footage.

Then you have to think about marketing.

I'm in the middle of doing all of this right now but I'll never have a partnership in a business setting, just asking for disagreements and one person to get real pissed and screw ALL of you over. That's just my opinion on partnerships.

I highly advise you to learn how to write a business plan and develop your milestones and everything else, you won't succeed without one.

To start off with 4 engineers isn't going to be very easy mainly because of salary, none of you would really be able to take much of a salary because I guarantee you once you figure out just how much you're going to have to spend per month you're going to fly out of your chair even with charging a room rate + whatever you all want to charge. It's not as simple as you're thinking, in concept it sounds that way but truuusssttt meeeee it's NOT.

Keep in mind none of us are quitting our day jobs and don't intend to get rich from this.

If you're not going to do it full time, you're wasting your time, money and effort with the thought, either stick to audio or stick to your day job, if that's how you think about running a studio, you're already setting yourself up for failure. The goal of any business venture is to make capital, it's sounds greedy but it's not. You HAVE to pour yourself into your business because ultimately, you ARE your business.

Don't take this as discouragement please, I'm telling you this as someone who is currently doing it and going through the processes and has previous business experience. I'm also doing things even harder by going for government grant funding, so heed my advice.