It’s the type of business idea that provokes skeptical reactions.
Really? You want to make vinyl records? In 2017?
Caren Kelleher says she isn’t too troubled by the skeptics, because the former band manager, who also worked at Google, knows more about the demand for vinyl records than most people.
When Kelleher tried to order vinyl records for the bands she managed, she was told it would take as long as seven months to get the records delivered -- often meaning they’d arrive too late to be able to sell them at shows.
The reason for this delay has to do with a shortage of vinyl record manufacturing facilities -- called pressing facilities -- that are able to do smaller runs for independent artists.
“Up until now, the factories that had survived the (vinyl) downturn had been at capacity,” Kelleher said.
Kelleher is trying to solve this problem by opening a vinyl record pressing plant in Austin called Gold Rush Vinyl. She plans to open it in December, after the equipment arrives from Canada to make the records.
“We’re going to focus on special orders,” Kelleher said, working primarily with independent artists interested in printing up to 1,000 copies. “Other plants can print more than that,” she said.
She plans to initially hire eight employees, including Build A Sign veteran Gator Russo.
Kelleher expects the operation to eventually grow to 20 employees. She has already secured the space: an 8,400-square-foot warehouse in Northeast Austin.
Though Kelleher’s vinyl pressing facility will be the only one in Austin, there is at least one other business in town that can make vinyl records. Recording studio Austin Signal uses a lathe-cut technique to carve out grooves.
Jon Niess, who owns Austin Signal, described the lathe-cutting process as essentially creating a record one at a time. It only makes sense for very short runs, such as 10 records, or for people who want personalized records.
Kelleher’s idea makes sense, he said, especially if she’s using new record-making technology. A lot of the older record manufacturing plants are relying on aging manufacturing equipment, he said.
“There’s still a lot of demand for vinyl,” he said.
Kelleher has ordered new manufacturing equipment from a Canadian company called Viryl Technologies.
Kelleher’s background is actually in music technology. After getting an MBA from Harvard, she went to work for Songkick, which is a concert ticketing firm, and then Google’s music division.
“By the end of my career at Google I was instead managing the partnerships that Google had with other mobile services,” Kelleher said. “One of the things that struck me was how little innovation was left for mobile music.”
She saw more room for improvement in vinyl record manufacturing, which essentially had stagnated over the last few decades as interested in vinyl records dipped.
Kelleher raised the money for Gold Rush Vinyl by taking out a manufacturing loan through the U.S. Small Business Association. She raised $750,000 through that loan and some money from friends and family.
Streaming services made up the majority of music sales in the United States last year, according to the Recording Industry Association of America, and that’s where the biggest growth is.
But when it comes to physical sales -- such as compact discs, cassettes or vinyl records -- vinyl records are where the growth is. CD shipments still make up the bulk of sales of physical products. But vinyl record sales were up last year by 4 percent, representing sales of $430 million, according to the association.
“One of the things that surprised me about being a manager and watching people buy vinyl is how young the people are,” Kelleher said. “It’s not just an audiophile explosion. This is people wanting to own a piece of art from a band they like.”
John Kunz can vouch for the comeback of vinyl records. The owner of popular Austin music store Waterloo Records says as of last year two-thirds of Waterloo’s music sales come from vinyl records.
He’s seen vinyl come full circle, because when he opened Waterloo Records in 1973 all he sold was vinyl records. Then came cassette tapes, then compact discs, the move to digital files, and now records again.
“I’ve always maintained that an analog sound is what our ears are designed to hear,” Kunz said.