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ewatk

Opening a studio

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I have recently begun thinking about starting my own studio along with a producer friend of mine. I have been a freelancer for a good long time now (7 years) and feel that the time is right to go to the next level. Problem is its obviously my first time and much like many first times, Im clueless, nervous, and completely inexperienced. So I would love to hear from people who have started their own studios or have knowledge of it, what are the pitfalls, things to look out for, first steps, etc, etc.

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In somewhat of an order, the hurdles you will need to jump through before you even pick up a wacom as a new company:

  • Lawyer / Accountant
  • The deal between you and your business partner in writing (by the above lawyer)
  • Incorporation (Fed, State, & City)
  • Clients you can start working for from the get-go
  • A marketing budget / planned initiative that your producer friend can field prospective clients with (spec works, etc)
  • Infrastructure (ie. new office, computers, network, supplies, etc)
  • Development of a solid brand - takes time, costs $ for site, reel, slate animations, etc etc etc
  • A really healthy chunk of change left after everything above is in order (I'd advise at least 30k - reserved strictly for business, no take-home) to cover costs of operations until checks start coming in 30-90 days after you finish your first job
  • Taxes

Just be prepared before you start. If you start telling prospective clients you are a company, you damn well better look and act the part or risk losing their respect forever.

Edited by AromaKat

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In somewhat of an order, the hurdles you will need to jump through before you even pick up a wacom as a new company:

  • Lawyer / Accountant
  • The deal between you and your business partner in writing (by the above lawyer)
  • Incorporation (Fed, State, & City)
  • Clients you can start working for from the get-go
  • A marketing budget / planned initiative that your producer friend can field prospective clients with (spec works, etc)
  • Infrastructure (ie. new office, computers, network, supplies, etc)
  • Development of a solid brand - takes time, costs $ for site, reel, slate animations, etc etc etc
  • A really healthy chunk of change left after everything above is in order (I'd advise at least 30k - reserved strictly for business, no take-home) to cover costs of operations until checks start coming in 30-90 days after you finish your first job
  • Taxes

Just be prepared before you start. If you start telling prospective clients you are a company, you damn well better look and act the part or risk losing their respect forever.

 

I have a lawyer and an accountant, Ive started the process of becoming an LLC, We havent signed anything between us but we were assuming we would be. infrastructure we have workstations, server, weve been scouting a few locations, and as far as furniture, Im thinking we have to get down and dirty with that Maybe get some sweet Ikea deals or state auction stuff. We have some scratch saved for the business as well.

 

As for clients thats a whole different story. I have work that I can show outright, no other company can lay claim to the design/production, but we have no readymade clients waiting for us to set up shop, I was hoping to shop around for representation, but I guess well see how that goes.

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Going through this now, about two years in with a very small studio. Everything Aromakat said is on the money. Before you do anything else get an agreement with your partner in writing. Seriously do this before anything else, make sure the agreement states what happens if one of you decides to leave.

 

Other advice is keep your overhead low. I agree avoid buying lots of expensive furniture etc. at the beginning, most of your clients prefer that you go meet them at their offices anyway so start off just spending on what you need to get the work done.

 

It's going to be tough to start if you don't have any clients lined up. I converted a lot of my freelance clients into studio clients and waited to have a big project that carried us for 6 months to start. From initially pitching a new client on your services to actually signing a contract to do work for them is a dance that can often take 6 months to a year so you need to be prepared for that.

 

Even with a small studio organization, time management and scheduling staff on multiple projects, forecasting cashflow, etc. can be big undertaking make sure you have a solid plan for this.

 

Have a good understanding of why you are starting a studio, what sets you appart and what you're specialities are, there are lot's of studios out there you need a good USP.

 

It might sound silly to say but treat your employees with respect. So many people in this biz are treated like disposable commodities that if you treat people with dignity and respect you can get great people who are happy to work with you even if you aren't offering the most lucrative or coolest projects.

 

You also have to be prepared to take a step back from the creative and be a businessperson with everything that entails. It can be tempting to want to just focus on the creative but this can get you into trouble fast.

 

Anyhow it's tons of work but it's a great experience. You need to be ready to roll the dice a bit and learn as you go.

 

 

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I'm almost 2 years in. Everything stated above is invaluable information. Keep overhead very low and work in a second bedroom/small space as long as you can do it. I was working in my server room for the first year, which usually was around 85 degrees (90+ in the summer and couldn't afford the volts for AC). Not fun, but starting a new business is not fun. It takes a shit load of hard work, focus and perseverance. You will doubt yourself, you will get depressed, you will drink a lot, but keep going and it will pay off. Make sure you surround yourself with other business owners who have done this before you and made mistakes and ask them lots of questions.

 

Oh ya, don't forget to get lots of exercise. This really saved me during the stressful days and still does. I'll go play hockey during the week and not think about anything business related.

 

Good luck!

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