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Financing Studio Construction
Old 26th February 2006
  #1
Gear Maniac
 
audioalchemy's Avatar
 

Financing Studio Construction

I have a question for all of you who own your own studio. I am in the process of putting togeather a bussiness plan in order to get loans to build my studio. I'm curious to see how others financed their studios. (loans, saved up, bought as you went).

Basically the setup i'm considering will cost 46,166 dollars.

PTHD Core System
3 96 I/Os
Soundcraft Ghost LE
Apogee Big Ben

and a few choice outboard pieces, pre's, comps, etc.

this doesn't include construction costs, but does include wiring, console furniture, interconnect etc.

Any insight anyone has would be most helpful.

Thanks,
AudioAlchemy
Old 26th February 2006
  #2
Smile

Sorry to rain on the parade, but I do, indeed, wholeheartedly concur with the previous post. Unless you have a religious organization, or a bunch of wealthy friends or relatives, or a job that pays serious bucks to pay for it, the main question will have to be, where are your clients coming from, and when will you possibly be able to break even, given the fact that you'll be playing gear-style keep up with the Joneses FOREVER. Unless you know something we don't know, you need rich friends. heh

However, if you're REALLY ambitious and resourceful, and a practicing magician, you may find a way. Good luck

I create music for broadcast in a way less than 500k studio, so I think $699 and a copy of Cubase should do you just about fine

Of course, we're being a bit facetious, but I'm sure you'll get yourself rolling, one way or another, if you've got your heart and mind set on it .
Old 26th February 2006
  #3
Gear Maniac
 
audioalchemy's Avatar
 

well here's the thing

like i said not including construction. but it will be in the basement of a large house, with 3 other people besides myself footing the bill.

I basically want it to be a mid level studio. more than a home studio but less than a really major one. upgrade as needed. we will be doing construction ourselfs, and i'm not looking for perfect rooms but good enough to do some rockin out.

thank you for the kind words though. i'm going to go through hell getting this done.

peace,
AudioAlchemy
Old 26th February 2006
  #4
Lives for gear
 

There is always the cheaper or easier way out. I was a previous studio owner and tried it the way you are except I put mine in a building... Total cost was under $100k and I struggled! Especially against people charging $25 with an mbox! Also I had to compete against a studio with a Neve in A and an SSL in B that charged ****in $28-35 an hour!!!!! How can I do that? So I liquidated and are the construction costs and now songwrite and produce, run a little label and work for one of the studios I competed against. I worked at a couple of them and it is so much better, I could charge $50-$75 an hour and my cost was $25 an hour... the downfall was the Neve breaks down, computer crashes, no vintage comps worked right.... the SSL was for mixing only and was a 5K series. To the avg customer nobody knew but thats a post board! Now I work and only make $15 an hour at a studio as a producer/engineer but I tell you what, I get to learn a real SSL (4K G+) and NO BILLS!
But to build a studio today and compete is HARD! Especially in Nashville where you have GREAT studios that you can get in for $40 with $8,000 mics and every pre in the world and the engineer has a long and successful history. Now why will they come to the new studio? Remember you sell yourself, not your studio although it helps!
Old 26th February 2006
  #5
Gear Maniac
 
Kalite Marka's Avatar
 

I can guarantee that you’ll spend less money on gear once you have an acoustically perfect Control Room (and a Tracking Room).
Old 26th February 2006
  #6
Lives for gear
 

A studio I'm helping put together in Canada for $50,000 budget:
Neotek series 3 console $6000CDN
2.5Ghz Mac G5 $5000CDN
Lynx Aurora16 $6000CDN
4 RNC's, 2 RNLA's, 1 Distressor, 1 Drawmer 1968 stereo tube comp., 2 Josephson sml, diaphram condensers, 1 SM57 $8000CDN.
cables, $200CDN, (studio out of business sale)

Still need more mics, stands, acoustic treatment, extra mic-pre flavors, headphone system, etc.
We'll come in at just under $50K and this is to be the highest end project studio in the area. This is in an old victorian house that does need acoustic work and a little floor treatment.
Basically this is enough for a little gear but not for the place to put it. This is not a business. This is in lieu of the owner going to school which is what it will be good for. The room will be cheap and comfy for loads of inexperienced bands in the area.
If it was for any sort of business, the room would some first in my opinion. There is no reason for me to do business with a studio that has improper room treatment. The first studio I was involved in put about $80,000 into the room before the equipment was brought in. This was a very small project studio aimed at doing over dubs.
In any case I have been involved in(my own included) the money came from family investments.
Of course this is just opinion and advise.
Please keep us informed on the progress!
Old 26th February 2006
  #7
Lives for gear
 
Benmrx's Avatar
 

FWIW, I've been able to survive, and just recently (about 3 months ago) quit my "day job" by going with a niche. Analog. I know it's not for everyone.

I spent about 7 years aquiring gear...selling it, buying it, trading up, trading down, etc. etc.. Then I got a $30,000 loan to sign a lease and build a studio. The one piece of gear I got with the loan was Langevin DVC.

The main item that keeps me in business is the 2" tape machine. I've been using a Ghost for some time now, and just recently lucked into a quad eight 15 channel sidecar. For the obvious need for pro tools, I've got an 001 and 002 + Tango24 synced together. It lets me dump all 24 tracks from tape in a single pass into pro tools and overdub/mix from there. My next purchase will most likely be a Lynx Aurora 8 cause my A/D/A at this point is a HUGE weaklink in my chain.

Everyone and their mom has a DAW, and if they've got even mid-level gear, a little know how and lot of creativity they can make some pretty amazing sounding recordings. You've got to offer something that's not available in your neck of the woods. At least that's been my approach. There's a guy in town with a studio with a very nice vintage Mellotron (not to mention a massive collection of other cool keyboards/synths) and I'm sure he gets a decent amount of business just from that.

Just my .02
Old 26th February 2006
  #8
Gear Addict
 

The best arrangement these days seems to be to keep borrowing to an absolute minimum, save save save, buy with savings, and don't fall into the trap of thinking that you have to spend 50K to build a studio to start working. I know people that are very very good with minimal equipment and we've all heard some people's work that's just so-so despite the fact they have every toy in the shed. Start small and get good. Half of 46K is plenty to get up and running, don't let anyone tell you different.

Borrow from family if you have to borrow and set up a repayment plan that gives them just enough to clear inflation and gets you out of debt in less than a decade. Don't mess with banks and business credit lines, this ain't that kind of business anymore.

Word to the wise... do something else at the same time. If you're a computer guy, be a consultant or if you're a carpenter, work part time, whatever. If you want it to be related start a label or do music licesnsing, children's music... anything to diversify the revenue stream. Be your own financing and forego the divorce and the early grave. The studio is, for me, love and extra income. I'm good with the gear I've got and I'm patient for the gear I want. I've got another job I probably won't leave because it's easy, flxible and pays well. I take off weeks at a time when I get gigs. Not very gear slutty but it works for me.
Old 26th February 2006
  #9
w2w
Lives for gear
 
w2w's Avatar
 

All the above replies offer great advice.Try not to sink into debt with this & like mentioned before,How are you going to pay it back?It IS brutal out there with the higher end rooms offering low rates,it comes down to why should we come to YOU?Having Protools these days means just about nothing because so does everyone else.The Ghost isnt anything special either(I used to own one).If you do jump in,invest in high quality pieces you can get your money back on,Neve,Api etc.Its better to have just a few tools of the best of the best,vs a rack full of prosumer gear just to make it look like you have some.(You want to go that route,buy some Funklogic rack fillers,you will LOOK great & I bet you coul resell em quicker!!).Just think it out & be real of what you expect when you get there,people wont just show up at the door.So much of this gear is way over hyped.Dont buy gear off of what you read is "Rich & creamy & huge" etc.Try the stuff for yourself,book a few hours in a few studios & try some of the gear your interested in,record a few tracks & take em home to reference,it will cost you a lot less & save you some bad buying decisions.....Best of luck..
Old 26th February 2006
  #10
Gear Maniac
 
audioalchemy's Avatar
 

WOW

thanks for all the advice and insight into this venture. i'm in a recording school now (flame on!!!) and am working on breaking in as an assistant through internships and hard work. the main thing for me was to have my own place as well. however it seems that selling my work and working at other studios is the way to go. besides i think that i can have a decent little 002R setup added to my exsisting gear for under 4grand. do that on the side plus asisting gigs and work up from there.

thanks again for all the advice.

AudioAlchemy
Old 27th February 2006
  #11
Lives for gear
 
cajonezzz's Avatar
 

Quote:
Originally Posted by audioalchemy
I have a question for all of you who own your own studio. I am in the process of putting togeather a bussiness plan in order to get loans to build my studio. I'm curious to see how others financed their studios. (loans, saved up, bought as you went).

Basically the setup i'm considering will cost 46,166 dollars.

PTHD Core System
3 96 I/Os
Soundcraft Ghost LE
Apogee Big Ben

and a few choice outboard pieces, pre's, comps, etc.

this doesn't include construction costs, but does include wiring, console furniture, interconnect etc.

Any insight anyone has would be most helpful.

Thanks,
AudioAlchemy
Our room is financed by an investor, but makes it's own nut.

When we sat down before busting walls out on our paltry ONE MILLION DOLLAR. facility- I told him i would never, ever, in a million years- build a studio as a commercial PROFITABLE business. He did it anyway, and we've all been lucky to be involved.

Business plan implies you are going to try and make money correct?
Stop now.

don't open your own shop, DON'T GO INTO GEAR DEBT. The only debt you should even remotely consider IMO would be buying the property.

Baby steps outta school my friend. Learn the BIZ. Learn how to wrangle deals into shops that are already built.
go out and find the artist, drag em into someone else's room, and get busy.
Finish the project- repeat.



Freelance- right out of the chute.

Save your $$$ and buy an editing/odub rig( cash) and do as much work you can AT HOME. This will help you save some $$ in the bigger rooms.

Book into nice rooms to do the stuff you can't.
Work in the best rooms you can- using some of that "income" that you are counting on to pay your 46 k loan. all the while you'll be making connections, staying in the loop, and not incurring the mind bending day to day pressure of running a room for profit.

DON'T EVEN THINK that you can build a room, expect to work enough local stuff to " pay the nut" ( especially a gear lease/loan) and still have time to work on stuff you dig.

The decent rooms arent going to dry up and blow away- and what your talking about spending won't get you close to the rooms that are already sitting there, with open days on their schedule.

I can't afford to work in our room on some projects I do- that 's the reality of the biz.

overcome and adapt, but please- Don't take on the debt.
Old 27th February 2006
  #12
Gear Nut
 
AcousTronic's Avatar
 

If you are a start-up business, you'll have tough time getting financed for any amount unless you don't mind paying a crazy rate. Once you have two years time in business, banks will through themselves at you. People should incorporate & open a bank account long before they actually open the doors. I do equipment and software financing as my main gig... You may want to consider an SBA line, and group your equipment expenses with the construction costs...

BUT, if it were me...

cajonezzz has a great point about the real estate. Put the bulk of your savings into a building and 9 times out of 10 you'll come out on top even if you don't profit from the actual business. Another great point, is to find talent and use someone elses facility for now... but do yourself a favor and incorporate and open a business bank account NOW, so that you don't have to pay the "start-up dues" when you do go on your own. That's free advice that you can literally "take to the bank"!
Old 27th February 2006
  #13
Lives for gear
 

Quote:
A studio I'm helping put together in Canada for $50,000 budget:
Neotek series 3 console $6000CDN
2.5Ghz Mac G5 $5000CDN
Lynx Aurora16 $6000CDN
4 RNC's, 2 RNLA's, 1 Distressor, 1 Drawmer 1968 stereo tube comp., 2 Josephson sml, diaphram condensers, 1 SM57 $8000CDN.
cables, $200CDN, (studio out of business sale)
Sounds like your doing OK with the kickbacks Jerry123heh

$6000CDN for a Lynx Aurora??? My god MSRP CDN is $3700 which includes a healthy 30% markup.

Old 27th February 2006
  #14
Lives for gear
 
T_R_S's Avatar
I bought a studio that went bankrupt. It was very cheap. There are several sales that come up. over the years I prurchsed the assets from 3 bankrupt studios.
When a bank is selling gear then tend to let it go cheap. When I built the studio I got a government low interest long term loan (very low payments) and a small grant.
Old 27th February 2006
  #15
Gear Addict
 

Quote:
Originally Posted by T_R_S
I bought a studio that went bankrupt. It was very cheap. There are several sales that come up. over the years I prurchsed the assets from 3 bankrupt studios.
When a bank is selling gear then tend to let it go cheap. When I built the studio I got a government low interest long term loan (very low payments) and a small grant.
Where does one find these listings?
Old 27th February 2006
  #16
Lives for gear
 
Igotsoul4u's Avatar
Make sure you have a nice blue print to follow. I would contact a studio designer and ask to purchase blue prints and build it yourself if you are really up to the challange.
Old 27th February 2006
  #17
Lives for gear
 

"$6000CDN for a Lynx Aurora??? "
Cables for the thing were just over $100 per channel. Plus Tax.

I heard a good rule of thumb is that after you cost your equipment, you can add a quarter of that again for the cable to connect it all. Seems to be true in a lot of cases.
Old 27th February 2006
  #18
Gear Maniac
 
audioalchemy's Avatar
 

what about this?

what about having a small mobile rig with say

a 002R
apogee big ben
pres with adat out
some decent mics

and doing a mobile rig setup where you could record anyone anywhere, live shows, a bands house etc. i realize going to where other people are is rough becuase you will have to fight with the room etc. but basically i need to upgrade my home rig and if i can move it easily to make some $$$ on the side until i get steady gigs at a higher profile level.

anybody do this, or done this. just wondering

AudioAlchemy
Old 27th February 2006
  #19
Lives for gear
 
Midlandmorgan's Avatar
 

Real estate is an area that seems to always increase in value...mine is just another way to look at what I think you are trying to accosmplish:

- First and foremost: find living quarters that are commercially zoned and all that
- Second, get your studio operating in inside the home, with a steady growth pattern built into your long term plans.
- Third, as time/finances permit, start building new building and failities/renovating old ones on your existing home pad...still a big investment, but an investment that can will still be yours should the studio go out of business....(this is where the right combination of location and zoning come into play...)
- Fourth: Doing as much of this as possible without financing is the smartest thing to do...it might take longer, but in the end you'll have something that is YOURS, not the bank's...and if push comes to shove and you GOTTA move, you will likely get a much higher return on your investments when the place is free and clear of 3rd/4th party finance companies...who are really out to do nothing more than take your money so you can get things done NOW as opposed to later.
- Fifth: don't wait too long before new construction/renovation of old ones begins...nothing is getting cheaper, and the longer you wait, the more expensive it is. Living on Peanut Butter and Ritz crackers for a year, stashing away the rest, and then buying in cash the upgrades/new additons outright, is in the end a whole lot cheaper than getting it all done now and paying for it for 15 years.

Just my opinion...
Old 27th February 2006
  #20
Gear Addict
 
AdAudioInc's Avatar
 

I put my studio together for that same amount - it's totally workable. Be honest with yourself and the bank in the Biz plan - and if it adds up, do it. Most banks hate these types of loans and you will be turned down a lot. But keep trying, I got my SBA loan on about the 5th bank.
If you KNOW you can make it work - you'll find a way.
Good luck.
Old 27th February 2006
  #21
Lives for gear
 
Jetblack's Avatar
 

Quote:
Originally Posted by audioalchemy
what about having a small mobile rig with say

a 002R
apogee big ben
pres with adat out
some decent mics

and doing a mobile rig setup where you could record anyone anywhere, live shows, a bands house etc. i realize going to where other people are is rough becuase you will have to fight with the room etc. but basically i need to upgrade my home rig and if i can move it easily to make some $$$ on the side until i get steady gigs at a higher profile level.

anybody do this, or done this. just wondering

AudioAlchemy
I have a small mobile rig that I use to pre prod bands in their own rehrsal space for fairly cheap before bringing them into the studio. Lately however, I have been doing a lot of live shows. My rig is a G4 powerbook, an 002R, a Presounus Digimax LT and a Lacie HD. I have about 16 mics and cables, and the band takes care of stands. Pretty straight forward and I get a ton of work done. This is by no means a substitute to the studio, but a great way to pre prod stuff or to charge for a limited demo.
Old 27th February 2006
  #22
On a $50k budget for kit only, here's what I'd buy:


Digital: G5 2.5ghz + Lynx AES-16 + AD-16x + DA-16x = $11,000

Software: Including Logic + Altiverb + Tritone bundle + EXS24 = $2,000

Automated Control Surface + MIDI keyboard + $1,500

Selection of Mics = $6,000

14 Mic Pres: SH Gama 8 + GR MP-2NV + Phoenix DRS-2 + 2 John Hardy = $11,000

Mixing: Phoenix N16 + Dangerous Mixer + SPL monitor/Talkback = $7,000

8 Channels of EQ: GR EQ-2NV + 4 x Speck ASC + 2 x ADT + $6,000

2 Channels Compression: Gyratec X = $3,000

Monitoring: Mackie HR824s = $1,500

Cables + Patchbays + Headphones + Consumbles = $1,000
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