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advise on taking a loan to pay for gear Digital Converters
Old 3rd January 2011
  #61
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dont do it
Old 3rd January 2011
  #62
Gear Addict
And yet, it makes one wonder doesn't it? If so many professionals are saying "don't do it"....why would that be? Oh yeah, they're probably all scared about loosing business to the new $100k startup guy. heh heh

Drbill You are probably right about that heh

EVEN if that was true, it would be telling in and of itself. If so many established people are scared of a startup, what does THAT tell you about the biz?


true true but why be afraid I tell you it would be in some sense liberating when the popular way of selling music goes to pop, it is dominated by manipulative moguls who care less about music and more about lining their pockets with dough. If you take american Idol, Xfactor in the Uk the artists get no way a decent share of the mega royalties. i don't know if you guys ever heard of Steps they sold some serious amounts of Cds about 20million i think, BUT (allegedly) the artists only ever pocketed £100k (allegedly)

I say if the guy has rich parents, a trust fund, or a secret plan (as alluded to), has good self esteem that won't be crushed by a lack of clients, and doesn't need to cash flow positive, GO FOR IT!!! You only go round once.... stikestike

hear hear otherwise in 10years time he will look back and say I had dream but consulted my fellow gearslutz members and then i decided to pack it in and now ... ok you get the drill
Go for it if you plan well that's all i'm saying.


Plus, the gear pimps need the biz. Buy new!!!

and we need cash-flow so are selling our slutty gear too, ok buy both new and secondhand
Old 3rd January 2011
  #63
Gear Guru
 
drBill's Avatar
Quote:
Originally Posted by digi882 View Post
And yet, it makes one wonder doesn't it? If so many professionals are saying "don't do it"....why would that be? Oh yeah, they're probably all scared about loosing business to the new $100k startup guy. heh heh

Drbill You are probably right about that heh
[I][COLOR="Red"]


Give me a break.

If you don't have to make your bottom line with money made off music/studio time, (and you self admittedly don't) you shouldn't even be commenting in this thread.
Old 3rd January 2011
  #64
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djmukilteo's Avatar
My point was obviously lost by your response digi.

If I had $100K and wanted to be in the music business I would start a business making the gear.
The technology available to the masses today and forward into the future just doesn't support recording studios!
Film/Post production ads etc. in the commercial world where there is a major market clientele can survive but I don't think that's what our OP was eluding to.
I may be wrong and he may have some major business going on with Disney or the like, but from a business model perspective his money would be better spent on developing new gear or software rather than opening up a recording studio.
And don't think these comments posted here by a lot of individuals is about discouraging anyone from some activity in their life that has the potential of making a living or following a dream, it isn't....
There is a big difference in a dream and delusion!
I wish more young people would realize that!
Go buy a lottery ticket!
Old 3rd January 2011
  #65
Lives for gear
 
dreamsongs's Avatar
 

Quote:
Originally Posted by digi882 View Post
And yet, it makes one wonder doesn't it? If so many professionals are saying "don't do it"....why would that be? Oh yeah, they're probably all scared about loosing business to the new $100k startup guy. heh heh

Drbill You are probably right about that heh

EVEN if that was true, it would be telling in and of itself. If so many established people are scared of a startup, what does THAT tell you about the biz?


true true but why be afraid I tell you it would be in some sense liberating when the popular way of selling music goes to pop, it is dominated by manipulative moguls who care less about music and more about lining their pockets with dough. If you take american Idol, Xfactor in the Uk the artists get no way a decent share of the mega royalties. i don't know if you guys ever heard of Steps they sold some serious amounts of Cds about 20million i think, BUT (allegedly) the artists only ever pocketed £100k (allegedly)

I say if the guy has rich parents, a trust fund, or a secret plan (as alluded to), has good self esteem that won't be crushed by a lack of clients, and doesn't need to cash flow positive, GO FOR IT!!! You only go round once.... stikestike

hear hear otherwise in 10years time he will look back and say I had dream but consulted my fellow gearslutz members and then i decided to pack it in and now ... ok you get the drill
Go for it if you plan well that's all i'm saying.


Plus, the gear pimps need the biz. Buy new!!!

and we need cash-flow so are selling our slutty gear too, ok buy both new and secondhand
You obviously don't make a living in the music biz in any way shape or form. There's a reason why most of the posts start with "don't do it".

And... this thread is beginning to be a tremendous waste of everybody's time. The OP gives no info whatsoever. We know nothing about his plan and what he intends to do except he wants to spend 100k on gear ???

Granted I have a little time to kill this weekend but this thread is useless at this point unless the OP let's us in on his "big secret"...
Old 3rd January 2011
  #66
Moderator
 
narcoman's Avatar
 

the main reason being - $100k is pin money. To even compete in the world where that sort of money is easily repaid you need to spend a LOT more. It's a catch 22. The gear in my studio is three times that (not including console). The rooms themselves - again - more money. A hundred grand is a big loan to take out for an ineffectual amount of cash - in other words you can't do much more with $100k than you can with $20k other than more gear. You can't get the room, you can't the business.
Old 3rd January 2011
  #67
Gear Addict
Once again the point seems to be lost by such a ridiculous narrow minded view points....

Let me say it again and listen carefully this time.

1. I DO make a living in the music industry is it millions NO!!!!
2. The fact i do other things is irrelevant it is simple economics if you are not making enough, supplement your income
3. The fact of the matter a lot of people on gearslutz a full of it, diversify is the name of the game anyone not prepared to do it cant then complain if business suffers.

This isnt just an expensive hobby for me btw i do actually work with talented individuals some who pay some i invest in thank GOD i have another job I can use the money to sponsor, pay for, buy gear etc. There is no defined method of making money in the industry.

I am not a 9-5 er i work every hour possible and make money the best way i can. I am not going to point out how much i make either way but as i mentioned INNOVATION is key.

A lot of studios have this closed shop mentality, this is the price that's it. I have seen a number of those types of studios close down owing loads of money. When i approached some of them and asked for flexibility they didn't in the end i went to a studio that did and they are very much still busy.

What again is funny is to the so called experts i mentioned a number of studios in poor countries make a living using gear AKA called prosumer MI etc

OP my advice is have a clear vision of what you want to do be prepared to slum it work different jobs if you have to. Plan plan plan I did and i'm still enjoying making music earning money and being CONTENT........

To the rest Good luck in your endeavors but please don't rain on the guys dream because you are struggling or even had to bail out or are even successful.

There are enough people in this world to make music you have to go beyond the norm and find them the internet is wonderful also as you can meet clients anywhere in this world. If you are doing just for local clients please pick a very large area.
Old 3rd January 2011
  #68
Lives for gear
 
djmukilteo's Avatar
Quote:
Originally Posted by digi882 View Post
Once again the point seems to be lost by such a ridiculous narrow minded view points....

Let me say it again and listen carefully this time.

1. I DO make a living in the music industry is it millions NO!!!!
2. The fact i do other things is irrelevant it is simple economics if you are not making enough, supplement your income
3. The fact of the matter a lot of people on gearslutz a full of it, diversify is the name of the game anyone not prepared to do it cant then complain if business suffers.

This isnt just an expensive hobby for me btw i do actually work with talented individuals some who pay some i invest in thank GOD i have another job I can use the money to sponsor, pay for, buy gear etc. There is no defined method of making money in the industry.

I am not a 9-5 er i work every hour possible and make money the best way i can. I am not going to point out how much i make either way but as i mentioned INNOVATION is key.

A lot of studios have this closed shop mentality, this is the price that's it. I have seen a number of those types of studios close down owing loads of money. When i approached some of them and asked for flexibility they didn't in the end i went to a studio that did and they are very much still busy.

What again is funny is to the so called experts i mentioned a number of studios in poor countries make a living using gear AKA called prosumer MI etc

OP my advice is have a clear vision of what you want to do be prepared to slum it work different jobs if you have to. Plan plan plan I did and i'm still enjoying making music earning money and being CONTENT........

To the rest Good luck in your endeavors but please don't rain on the guys dream because you are struggling or even had to bail out or are even successful.

There are enough people in this world to make music you have to go beyond the norm and find them the internet is wonderful also as you can meet clients anywhere in this world. If you are doing just for local clients please pick a very large area.
digi:
Calm down...no one here is trying to undermine or attack you!??
In fact I'm sure nobody really cares that much about this, how could we?
This isn't about you, you offered up your opinion to the OP and several of us disagree with you and offered some of our own to the OP.
You can believe and do whatever you like. More power to ya
It's just different peoples opinions, ideas and advice.
But I would still advise you the same way if you were thinking about taking a loan out to build a studio and buy gear! That's all!
There's no agenda here, or at least there shouldn't be.
And as you may know nobody in this world decides on anything in their lives except themselves...nobody. Somebody here posting some advice is rarely taken into account by the individual, 9 times out of 10 they've already made up there minds on what they're going to do, as most everyone should do, the OP will do what he decides to do, not you, not me...there are no winners or losers, were just discussing this topic.
Old 3rd January 2011
  #69
Gear Guru
 

Quote:
Originally Posted by digi882 View Post

1. I DO make a living in the music industry is it millions NO!!!!
2. The fact i do other things is irrelevant it is simple economics if you are not making enough, supplement your income
far from being irrelevant, #2 negates #1

If you need to supplement your income, you are NOT 'making a living' in the music industry.

you are making 'some money' in the music industry

My first question to you is: if your music work dried up tomorrow, or your "other things" work dried up tomorrow, which one of those two events would financially hit you the hardest?

My second question to you is: how far in debt are you? How big of a loan for gear are you paying off, and are you paying it off entirely from the proceeds of your music work with enough left over to live on should your other things fall apart?

Are you advising to OP to put himself in a fix that you yourself are too smart to get into?
Old 3rd January 2011
  #70
Gear Nut
 

Quote:
Originally Posted by Lee Cardan View Post
I guess some people like golf, nice cheap hobby,
??? Cheap only compared to recording gear or watch collecting By any rational frame of reference, ridiculously expensive !
Old 3rd January 2011
  #71
Lives for gear
 
doug hazelrigg's Avatar
Originally Posted by Lee Cardan
I guess some people like golf, nice cheap hobby,

Quote:
??? Cheap only compared to recording gear or watch collecting By any rational frame of reference, ridiculously expensive !

Oh, man... if you only knew how much money I've wasted over the years on golf clubs, golf schools, golf outfits, golf balls, golf equipment, and greens fees... and my handicap in fact has gone UP
Old 3rd January 2011
  #72
Lives for gear
 

I would say if your planning on charging a reason studio rate then a loan is should be considered to be paid off within a 24 month payment plan. We are still in a recession!
Old 3rd January 2011
  #73
Gear Nut
 

So anyway, if everything is in such a state of disaster and gear is worthless and studios are selling off their stuff, why can't I find a slutty mic pre, say 1073ish for 300 bucks? Or some decent monitors for the same?
Old 3rd January 2011
  #74
Lives for gear
 
djmukilteo's Avatar
Quote:
Originally Posted by matic View Post
So anyway, if everything is in such a state of disaster and gear is worthless and studios are selling off their stuff, why can't I find a slutty mic pre, say 1073ish for 300 bucks? Or some decent monitors for the same?
That my friend has to do with market value!
Two different commodities with two different markets.
Old 3rd January 2011
  #75
Lives for gear
 
doug hazelrigg's Avatar
I don't consider this thread a waste of time. It's interesting reading people's opinions on this.

I'm not sure why we're still discussing the option of a $100,000 unsecured loan. Ain't gonna happen. Period. Now, I'm not saying such loans don't exist; they do. Some years ago I took out a sizeable signature loan (what I mean by signature is, all the bank required was my signature, nothing else) but this was because I had a long relationship with the bank but far more importantly, our successful business of many decades transacted with the bank to the tune of millions each year. But from I gather this isn't the OP's situation at all... not to mention that banks in bigger markets have tightened up their loan portfolios drastically.

As I said, I think an equity loan or HELOC IS an option. But just as most of us have said, don't do it. For a number of years now Bob Brinker of the radio show "Money Talk" has been warning of a huge growing bubble of outstanding equity loans in America, and advises his listeners against it (except to pay off unserviceable credit card debt).

I really think the incremental approach is the best idea. "Purists" here on GS rage at the idea, but you really can create a viable piece of music without spending a fortune these days.
Old 3rd January 2011
  #76
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cinealta's Avatar
 

Quote:
Originally Posted by djmukilteo View Post
If I had $100K and wanted to be in the music business I would start a business making the gear.
Or closing out failing studios.
Old 3rd January 2011
  #77
Lives for gear
 
djmukilteo's Avatar
Quote:
Originally Posted by cinealta View Post
Or closing out failing studios.
As in investing in buying out the gear from said failing studios and selling it, I would agree!
Anything with tangible market value!
Old 3rd January 2011
  #78
Lives for gear
 
Hammer Mark's Avatar
I can't imagine any responsible lender making this loan regardless of the interest rate or other conditions. Do you have a business plan? Can you generate enough business to pay $1,000/month in interest on top of $2,000 in other expenses and have enough left over to shelter and feed yourself?
Old 3rd January 2011
  #79
Gear Addict
 
glenn_jr's Avatar
 

You don't need financing!

I didn't read all of the posts, so apologize if this has been brought up....

The timing of your post with an email I received brought my reply on. I've been following a guy named John Spiers for quite some time. I've read his book twice, and follow his blog from time to time. He's essentially a 'small business guru' who teaches how to start up your own business (import type), but his advice really works for most any business.

Here's what he says on financing:

If you are contemplating getting a business started, you must get rid of one bad idea: financing. You do not need money to start a business, you need customers. Customers buy things, and give you money. There is all of the financing you need. But but but... I need money for... NO YOU DON"T. You can get along with out it... if you have some savings, and things might happen faster investing a wee bit of savings, then fine. Your own money, ok. But you need no financing.

Bu but but... my project is so big I need financing. NO YOU DON'T! Just make the project smaller. Cut out the part you can handle without financing, and do just that. Start from there. You do not need finance.

Taken from: How Business Happens: You Do Not Need Financing

I too find his words very true. When we started out, we had a Superlux SM58 knockoff. We recorded that into our *gasp* motherboard stock sound card through a dj mixer; our room 'treatment' consisted of putting the mic into a foam-covered box.

Funny thing was, the customer didn't care. He wasn't willing to pay for good quality from a studio, so he happily chose us. From that we slowly built up our business and paid for better gear from what we made. We so far haven't been labeled 'the cheap guys' because we didn't try to take on cases that required quality that we didn't have. We quoted reasonable rates for the work we provided and equipment used. We essentially existed through word of mouth until we got to the point that we felt our quality was good enough to go after bigger clients and higher pay; and that has worked for us.

We still have a ways to go. But so far so good. And all from literally nothing. I say, don't finance.
Old 3rd January 2011
  #80
Lives for gear
 
doug hazelrigg's Avatar
I don't disagree with Spiers at all, as far as starting out goes. But many businesses start up, and get rolling, and inevitably hit a wall that is basically a shortage of capital. But if they have a proven customer base (like you said), and can show past revenues, they can often find a well-heeled investor who will provide them that capital in exchange for a share of the business (or whatever sort of arrangement they negotiate).

I have a good friend in Texas who does this sort of venture capitalism. He's not big like the Silicon Valley venture boys are, but he has made millions. He's my age, 49, and he made enough money that a few years back he "retired" and returned to his lifelong dream of being an actor. And he's gotten work -- in fact he's in the new Jim Carrey movie "Phillip Morris"

If you don't follow your dream, it will become your curse
Old 3rd January 2011
  #81
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play/record's Avatar
 

have a job.
Old 3rd January 2011
  #82
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doug hazelrigg's Avatar
Quote:
Originally Posted by perform/record View Post
have a job.
"Get a job, na na na na , na na na na na...
Get a job, na na na na , na na na na na..."


Can't remember the group's name
Old 3rd January 2011
  #83
Gear Maniac
 
LimeMusic's Avatar
 

OK, OP...

I did what you want to do. Not through a bank, but my partners and I took out a loan (not 100k, but close) through a local small business owner to buy gear and build our room. Of course, no bank would have ever lent us the money!!

Anyways, we had a business model etc, did research on the local studio rates, etc, and determined that we had a good chance of making a successful studio business. And we actually did have a chance!!! Not to make myself sound great or anything, but I was against it. I wanted us to go slow and buy what we could afford....

Anyways...
4 years later, its all been de solved. Studio makes no money. I broke off from my partners and moved away. I guarantee you I make more from recording in my small project studio than my partners do in their decent "well-financed" studio...

Just my experience... Take what you will....
Old 3rd January 2011
  #84
Gear Maniac
 
LimeMusic's Avatar
 

Quote:
Originally Posted by digi882 View Post
a number of studios in poor countries make a living using gear AKA called prosumer MI etc
I'm sure this is absolutely true. So you agree with others here... You don't need to take out a huge loan to make money...

Quote:
Originally Posted by digi882 View Post
OP my advice is have a clear vision of what you want to do be prepared to slum it work different jobs if you have to. Plan plan plan I did and i'm still enjoying making music earning money and being CONTENT........
We aren't talking about doing what you have to in order to get by... We're talking about saddling yourself with a HUGE debt in a climate that isn't conducive to success in the recording studio industry. Getting by is hard enough these days. It sounds like you don't really grasp the debt the OP is looking to take on...

Quote:
Originally Posted by digi882 View Post
To the rest Good luck in your endeavors but please don't rain on the guys dream because you are struggling or even had to bail out or are even successful.
Again, it sounds like you don't have a concept of what's being discussed. 100k is A LOT of money. It's a HUGE decision, no one is raining on the guys dream, just presenting a logical point of view....
Old 3rd January 2011
  #85
Moderator
 
narcoman's Avatar
 

Quote:
Originally Posted by digi882 View Post
Once again the point seems to be lost by such a ridiculous narrow minded view points....

Let me say it again and listen carefully this time.

1. I DO make a living in the music industry is it millions NO!!!!
2. The fact i do other things is irrelevant it is simple economics if you are not making enough, supplement your income
3. The fact of the matter a lot of people on gearslutz a full of it, diversify is the name of the game anyone not prepared to do it cant then complain if business suffers.

This isnt just an expensive hobby for me btw i do actually work with talented individuals some who pay some i invest in thank GOD i have another job I can use the money to sponsor, pay for, buy gear etc. There is no defined method of making money in the industry.

I
Aye but your success isn't a reason for someone else to take a huge risk? I make money - I make a lot of money. In this business. But I wouldn't want to start up now with a loan... no way.........
Old 3rd January 2011
  #86
Lives for gear
The reason people are saying dont do it is simply because of the size of the initial investment.

Start with a 1/4r of that, for instance...if things are still moving in a couple years and you have a plan then do what you need to do to grow.
Old 3rd January 2011
  #87
Lives for gear
 

I just don't think that anyone who comes on an internet music technology forum can be trusted to handle $100,000 of somebody else's money in a manner where they are ever likely to see it again, and thus even if the OP does have a reasonable capital and a house at the moment, they might not do forever.

If you want information on taking out a loan, go and see a financial advisor. Why the Fk would anyone on Gearslutz know anything about loans?

I think people should give in telling him not to do it, you have no idea about what he's doing do you, so why ask? He might have $800,000 already and is looking for the extra $100,000 because he has a detailed business plan and has identified the need for $900,000; so people really should quit on the 'with $100,000 you're screwed' train because you don't really know.

My point is, $100,000; $1,000,000 or $10,000,000; if you are using Gearslutz for your financial advice you cannot be trusted with upwards $100,000 of somebody else's cash...
Old 3rd January 2011
  #88
Moderator
 
narcoman's Avatar
 

..... actually he's made it pretty clear that this is the only money he has and it's in the equity of his home! You're right about the whole "asking on GS" thing, that actually adds to the point of "don't do it". Truth is - nobody will LET him do it - only a shark would take him on and hopefully he's wise enough to spot one!
Old 3rd January 2011
  #89
Gear Addict
far from being irrelevant, #2 negates #1

If you need to supplement your income, you are NOT 'making a living' in the music industry.

OK lets see here I take it in your line of work you do one thing right.
Ok you Record, Mix, Master, etc
Ok what else do you do then if you say that's it fine.

However some of us have multiple skills i.e we can do more than one thing
You see it all the time a singer, successful, makes loads of hit record decides the $5millon is not enough decides she wants to be in the movies, so she takes on a movie role hmmm lets see now what exactly is she a singer or movie star and like it or not she is supplementing her income. IT IS ALL RELATIVE, people have a variety of reasons. I don't like to pigeon holed as one thing alone.

Life is about risk taking win some lose some. Some of the most inspiring successful business men i know went bankrupt a few times before finally succeeding. The reality whilst $100k is a lot as a few people have pointed out it wont be enough for a top drawer studio. The OP is seeing if anyone else took a big loan out and was successful at it I am pretty sure there have been a few successes as i mentioned plan plan plan.

Someone advised he should buy a house rent it out then use the rent money etc that may seem a wise decision but i am not sure that would yield enough, still it aint a bad advice heck i have done that too.
So people get back to the OP question he has already decided he needs $100k why not advise the best way to get it and if that means telling him to go to a financial adviser then that is a good advice oh provided he finds a good one off course.
Old 3rd January 2011
  #90
Gear Addict
Quote:
Originally Posted by LimeMusic View Post
OK, OP...

I did what you want to do. Not through a bank, but my partners and I took out a loan (not 100k, but close) through a local small business owner to buy gear and build our room. Of course, no bank would have ever lent us the money!!

Anyways, we had a business model etc, did research on the local studio rates, etc, and determined that we had a good chance of making a successful studio business. And we actually did have a chance!!! Not to make myself sound great or anything, but I was against it. I wanted us to go slow and buy what we could afford....

Anyways...
4 years later, its all been de solved. Studio makes no money. I broke off from my partners and moved away. I guarantee you I make more from recording in my small project studio than my partners do in their decent "well-financed" studio...

Just my experience... Take what you will....

Hey but you still have a Business studio right albeit a small personal one i bet you if tot up all your gear its worth a fair sum right.

If you read my posts I am saying he should start of with a decent room maybe cap the price at say $45k once done then buy secondhand or new if he gets gear that negates the needs for multiple gear i.e zed gsr24 it takes care of 4 things then maybe 2 outboards, 2 mics headphones cables and he is done. my rough calculations is that tops he will spend $65k the rest he either returns or try to invest in something that might bring some return. The best advice i think would be to get $100k lined up but only take out the amount as needed i.e get it approved on a basis he takes half and can come back for more later. Anyway we don't know his circumstance and to be honest I'm done now. Good luck which ever way you go OP it is risky but if you plan plan plan well then maybe you can be successful.
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