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July 2014
Issue: June 1, 2013

Big Things, Little Packages

By: Randi Altman
The industry has been in flux the past few years, with some of the larger post houses going away or being acquired by others.
While there is still a place for those larger entities, we’ve been seeing the rise of smaller facilities, those who are able to keep overhead low and morale high.

Sometimes big things do come in small packages.

RED ECHO POST
Cincinnati’s Red Echo Post (www.redechopost.com) opened its doors in September of 2001 — September 10 to be exact. On September 11, the staff was awaiting delivery of equipment when the world changed. “We didn’t know what would be happening in the next few weeks, but we just had to move forward,” explains CEO/president Craig Tyree.

And they did.

After years of being on the client side of post, Tyree’s dream was to build a post house where he would have felt at home... a place he would have brought his business. It took Tyree about a year to secure funding, which he ultimately got via a large local bank, and he was on his way. “I borrowed a chunk of money, and signed away everything I owned,” he explains.

Tyree (pictured, right) then went to work building a business aimed at meeting client needs. Red Echo Post started with two edit rooms, as well as a suite for graphics and 3D animation. At the time, the idea was a hybrid of a boutique and a full-service facility. “We wanted to keep it small and nimble so we could react fast,” he says. “We knew one of the shortcomings of boutiques at the time was they could only work with one format; we wanted to be full service on the back end. We wanted to not only handle the creative, but to also have the ability to offer mastering, duplication and distribution services for our clients.”

So the idea was to stay small and only expand as needed. Two more edit rooms were added along the way, one in 2003, the other in 2010, and about six years ago came the Red Echo audio suite. The most recent addition is a two-year-old Filmlight Baselight for color grading work.

The studio’s 10 full-time employees take on all the work themselves. “We got to a good size where we can handle whatever our clients need and still stay somewhat sane,” laughs Tyree. The jobs that come in are a combination of regional and national commercials. On the local side there is restaurant, financial and healthcare work as well as projects for the Ohio and Kentucky lotteries. On the national front, they have serviced Fifth Third Bank, Long John Silver’s, Fresh Express and many Proctor & Gamble brands, including Olay and Secret. “In our 12 years, we have probably touched something for every P&G brand.”

Tyree believes the key to a happy client is a talented and happy staff. He considers his — made up of older veterans and younger talent — a family that works and hangs out together. “They are friends, and they have lot of respect for each other.”

Red Echo Post has even been known to close down for long weekends so employees can attend a company-hosted trip. And when the studio is doing well, the staffers benefit. “It’s nice being a small company and not having to answer to a board or investors. So when we are in a busy cycle and making money, it’s nice to be able to share those profits.”

It’s apparent just how much Tyree cares about his staff and that, along with offering clients the services they need, plays a big role in Red Echo Post’s success. “I always say, anyone can buy the equipment, but you need great people doing the work. When we bring in someone new we make sure their work is good, but we also make sure they fit into the family here.”

He has a similar theory about securing and keeping clients. “When we opened, myself and my operations manager Rob Smith called everyone we knew in the market and asked them for a chance to earn their business. That was our sales for about 10 years,” he says. “Keeping them coming back involves giving them respect and personalized service.”

Ultimately, Tyree says, the key to staying small but successful is growing when it feels right. In terms of adding new rooms, he offers up the Baselight color grading room as an example. “We were being asked more and more to do color in the edit suite. Just as you have a dedicated audio room because it’s tuned for sound, you need a dedicated room tuned for color to do proper color grading.”

NATHAN LOVE
Animation and design studio Nathan Love (www.nathanlove.com), based in Soho in New York City, opened in 2007 as a 3D character-driven studio. There weren’t many around at the time. “That helped us get noticed,” explains founder/creative director Joe Burrascano.
While character animation might have been the origin of Nathan Love, the studio has since diversified and added 2D animation, visual effects and mixed media work to their offerings, while continuing to do character work.

The eight-person studio will swell to 30-35 people for a few months at a time, depending on a particular project. “Then we’ll get to wind down, recover, and think about ways to grow from the experience and think about how we can take our work to the next-level before ramping up again,” says Burrascano.

Initially, Nathan Love carried a larger staff, but then the economy tanked. “As a young business owner I learned you don’t just get lucky and keep rising for the rest of your life,” he shares. “There are actual pitfalls and lessons to be learned. So my staff dwindled down at that point. That is also when I realized if we wanted to stay in business we had to diversify, expand our design capabilities and handle more requests in-house.”

They scaled down to “a more capable and diversified team” who are now the core of Nathan Love. Around that core they rely on a trusted and steady stream of artists to come in and help out, depending on the project. Some of those artists are based around the world. “It’s become a global phenomenon,” explains Burrascano. “We had an artist in Poland reach out, there is another one in Brazil who is a specialist in the type of characters we develop; he is amazing. Being small and not having to commit to certain full-time artists, we have set ourselves up to be working with better and more interesting talent from around the world.”

When he opened Nathan Love, Burrascano believed all he needed was a group of good artists, but quickly realized the importance of client management and scheduling. There are two full-time producers — an EP who deals with the clients day to day and oversees business management, and a head of production handling clients and the staff. “They work with the other six in-house to make sure all the components work together,” he says. “The people we have hired full time are very compatible with our own personalities and complement the work we like to do and expand on things we wouldn’t normally be able to do,” reports Burrascano. “So far, we have a very harmonious staff; everyone pitches and helps each other.”

While 90 percent of Nathan Love’s business is in commercial advertising, they also have a relationship with Morgan Spurlock’s The Warrior Poets, located just a floor away from them. This gives them the opportunity to try other types of work. “We do title development, show packages, we’ll help them with some of their graphics on the pitches they do for TV shows or movies. It’s been interesting extension.” Another extension is developing Websites, which Burrascano calls a natural progression from creating the entire visual look of a campaign. “Clients would ask, ‘Can you also develop the Website too?’ That is when we started from the beginning with the whole user experience in mind.”

A recent job was for McGraw-Hill Education, a publisher of school textbooks, which refreshes its reading program every six years. They came to Nathan Love with a loose concept. “Typically, they hire illustrators for 20 or so book covers across six grades, but his time they wanted a studio to develop a consistent look across all covers, plus one big story, which can be told to all grades.” When it was done, McGraw-Hill asked the studio to build a Website too.

A more traditional Nathan Love project was a Kellogg’s Froot Loops spot, Carl the King Crab, in which the studio brought the 50-year-old character Toucan Sam into a 3D world for the first time. The studio used Leo Burnett’s script to create a “detailed CG wonderland,” in which Toucan Sam and his nephews take on a grumpy pirate crab.

Tools used included V-Ray for rendering, RealFlow to simulate the coins, and Joe Alter’s Shave and a Haircut to detail Carl the King Crab’s goatee and moustache. The studio also uses Autodesk Maya, Adobe’s Creative Suite and Pixologic ZBrush. You can see their work big on our cover this month.

When Burrascano looks back to when he first started Nathan Love, he realizes that being “young and naïve” actually worked in his favor. He sort of bet it all on the dream of his own studio, and with the help of his wife, a loan from his folks, and the promise of work from Psyop, he made it happen. “I got my first credit card and I’d order two computers, then wait until my daily limit cleared, then call again. It was all on credit and a dream!”

AUDIOENGINE
Audio post house AudioEngine (www.audioengine.net) opened its doors in New York City back in 2002. Two years later, the studio expanded to Phoenix, with partner Bob Giammarco heading up that location. This past January, Giammarco bought out his partners — Tom Goldblatt, Rex Recker and Brian Wick — to become the sole owner of AudioEngine.

“The post business began to change and we were looking at different options on how we wanted to move forward,” he explains. “When it came down to it, I still, very much, had the entrepreneurial spirit in my belly, and my partners, for a multitude of reasons, didn’t feel quite the same way. We realized that what served everyone the best was for me to buy them out and run it myself — with them continuing.”

Yes, they are all still at AudioEngine, which has 23 employees across both its locations, servicing the clients and producing the work. “They are here doing what they do best, but just relieved of the burden of the day-to-day operation of a business in two states and the things that go along with that.”

Acquiring full ownership of AudioEngine required financing, and Giammarco went about it in the traditional way. “I am not a  beginner anymore. That allowed me a lot of options. When my partners and I first set out to form AudioEngine we were a complete start-up. No one would talk to us,” he laughs. “The world was so different in 2002 with us having no proven track record. Plus the overall business environment was so different. The amount of money we wanted to borrow to start AudioEngine in 2002 was the amount big banks were looking to make in terms of commission. Now with a balance sheet and P&L, I have proven myself and can demonstrate I know how to run a business, control costs and deliver on the bottom line. So I was able to secure a great loan without having to use private equity or any of the programs that drive up costs.”

Giammarco, who still works sessions daily in Phoenix and during the one week a month he’s in New York, acknowledges that the post audio environment itself is more challenging than ever. “You have consistent downward pressure on margins from every point of view. From services that used to give us a high-margin opportunity that don’t exist anymore to room rates that are consistently under pressure.”

In addition to controlling costs, including having the back-end administration part of the business based in the more real-estate-friendly Phoenix, Giammarco says it’s imperative to keep brand recognition strong. “We need to maintain that in the face of new competitors, including ad agencies and editorial studios adding services in-house. Even guys working out of their kitchens, who don’t offer the same services, help erode business.”

Yet, Giammarco is quick to point out that competition is good and makes everyone work harder… as long as everyone is on a level playing field. “I don’t even mind the ‘in-house’ facility, as long as you are going to do it right. If you hire a guy like (renowned studio designer) John Storyk, buy the right gear and build that to compete with us, then that’s fine. It’s when these in-house facilities are substandard — from a facility or talent point of view. That’s when I have an issue, because the work doesn’t win.”

What does help win jobs and keep clients coming back is a happy and talented staff, and AudioEngine believes in treating its staff right. Giammarco describes the process as simple. “In terms of your senior people, pay them right and give them the right gear. That keeps most engineer types happy. In terms of the junior staff, provide an environment for them to grow in. Right now morale at both locations is perfect, probably the best it’s ever been in the history of the company, and the only way to keep it that way is to be consistent and make sure you only keep the right people.”
Another thing that helps with staff is offering them insight into decisions that are made.

“I try to share as much information with the staff as possible to let them know why we do and don’t do certain things. People feel empowered by that. By bringing my people in on the decision-making process, it helps them understand my decision, whether they agree with it or not. That way they don’t feel as though they are just being dictated to.”

The Mission: happy clients

VENICE, CA — The Mission (www.themissionstudio.com), which opened in 2011, offers visual effects for commercial, film and digital content projects. In a little over two years since opening its doors, the VFX shop has doubled its space with the recent expansion of over 6,000 additional feet.

With a team of 18 employees in their Abbot Kinney location in Venice, the studio was funded with independent savings and investments by th e owners, and retains their talent with a “beach-style company culture” and “a hip and accommodating space.”

According to executive producer Michael Pardee, “It’s not your ordinary post house. We have movie nights, happy hours, and on Fridays we do a big breakfast for anyone that’s here. It makes for relaxing moments amidst the craziness that we can encounter in this field we chose.” Artists and clients can be found playing guitar by the fire pit or enjoying a drink by the koi pond after a long, hard deadline.

The Mission, which has contributed VFX to a number of projects recently, including repeat work with Hershey’s, Samsung, Nike and Old Spice from agencies such as Wieden+Kennedy, 72andSunny and Arnold NY, takes on all kinds of projects.

“Every job is the most important. It doesn’t matter if it’s a pharmaceutical [project] or one for the latest and greatest phone/tablet,” explains Pardee. “You can hit it out of the park nine times out of 10, and they still always remember the one time you didn’t — the goal is to not let that happen.