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# Schiit Happened: The Story of the World's Most Improbable Start-Up - Page 94

@ab initio - This is based on just a brief Google, and I'm not an expert in anything, but it looks as if wavelets have been used in DSP primarily for compression.

Quote:
Originally Posted by judmarc

The uncertainty principle in quantum mechanics has to do as I noted with particle position and momentum as the conjugate variables, not frequency domain and time domain behavior.  I used it as another example of conjugate variables under Fourier analysis - as position becomes more precisely known, momentum becomes less precisely known, and vice versa.  For the same reason (because they are conjugate variables), with digital filters as time domain behavior becomes more optimized, frequency domain behavior becomes less optimized, and vice versa.

"Position and momentum", "spaitial distribution and spectrum" call it whatever you like, the uncertainty principal holds. The quantum mechanics article on uncertainty principal was previously linked because it elaborates further, but to reduce confusion, I have linked to the short discussion in the Fourier transform article.

Cheers

Quote:
Originally Posted by judmarc

@ab initio - This is based on just a brief Google, and I'm not an expert in anything, but it looks as if wavelets have been used in DSP primarily for compression.

This is off topic in this thread. If you want to discuss wavelets, I encourage you start a thread in Sound Science.

Cheers

Edited by ab initio - 6/16/14 at 12:58pm
Quote:
Originally Posted by Armaegis

So for those who have been weighing in on the digital filter thingamajigs... what do you guys make of this guy's work: http://www.dddac.com/dddac1794_design.html

He does a PCM1794 NOS with no digital filters

A Delta-Sigma Dac with no Oversampling digital filter?  Is that even possible? The achievable resolution will surely be very poor?...

As long as mrs Stoddard and Moffit get their regular conjugal visits I'm certain whatever they Schiit out will be great. Regardless of the variables or the quantum state of their asymptotes.
^ ROTFL
Quote:
Originally Posted by ab initio

The frustrations with using fourier analysis, where signals are broken down into a sum of sine modes (sine modes have infinite extent in time and are perfectly localized in frequency) led to the development of methods such as wavelet analysis, where one can use a different set of test signals to (i.e., wavelets) to decompose a time domain signal. here, Wavelets have some localization in time and some frequency content; however, they too cannot be localized in both time AND frequency.
Quote:
Originally Posted by ab initio

This is off topic in this thread. If you want to discuss wavelets, I encourage you start a thread in Sound Science.

Cheers

So a couple of posts after you raise the subject of wavelets, it is off topic, eh? OK, I am pleased to agree. Back to DACs or something else Schiit-related. (Conjugal visits?)

As a "liberal arts" guy, I get lost in a l lot of the engineering-e's-but as a music lover and someone interested in hi-fi (both the head and speaker variety) I enjoy trying to put the pieces together in my mind.

One of you guys could make a living writing a digital audio for the "dummies" or "idiots guide" series and then, they would have pay you to update it every six months at the rate of technology

Seriously, for newcomers or folks that are less tech oriented it would be great to have a very simple-this is how it works and what it means-well written resource. There may be one and I'm just unaware of it.

In the meantime, I'll keep trying to decipher this foreign language with the endgame of having my music sound better and better!

Quote:
Originally Posted by markm1

As a "liberal arts" guy, I get lost in a l lot of the engineering-e's-but as a music lover and someone interested in hi-fi (both the head and speaker variety) I enjoy trying to put the pieces together in my mind.

One of you guys could make a living writing a digital audio for the "dummies" or "idiots guide" series and then, they would have pay you to update it every six months at the rate of technology

Seriously, for newcomers or folks that are less tech oriented it would be great to have a very simple-this is how it works and what it means-well written resource. There may be one and I'm just unaware of it.

In the meantime, I'll keep trying to decipher this foreign language with the endgame of having my music sound better and better!

I really don't think you need to know about this so much. Just know there are specs, then there are reviews, and then there's personal experience and that's how everything is tested.

^^ markm1 there are the wikis on head-fi that partly address this but what you suggest is a good idea. There are indeed tech people on here who write well and simply for non-techies. One of them will have to see your idea and decide to do something about it though...

Chapter 20:

The HOA Problem

While we were working on Magni and Modi and Gungnir and Mjolnir—through all the troubles and triumphs and setbacks and workarounds—I couldn’t fight a growing unease.

Unease about how big we were getting.

Yeah, I know, laughable now. Hell, I’ll be signing a lease to increase our total square footage to over 8,000 square feet on this week of out 4th anniversary.

But that’s now. As of early 2012, I had very good reasons to be worried. Rina and I live in a neighborhood with a home owners association, or HOA. For those of you outside the USA, that’s where a bunch of insanely picky buttheads get together so they can determine the acceptable colors of each others’ homes, send nastygrams about cracked concrete or broken bricks, and generally act like a bunch of old-timers with bad “get off my lawn” syndrome.

(Of course, I’m being flippant here. My business partner at Centric specifically avoided buying a house with an HOA neighborhood, and later had a neighbor paint their house in day-glo sky blue. Yeah. And, in our case, the HOA does serve a useful purpose, since it maintains the greenbelt that separates us from the hillside brush. Which I was very thankful for in 2003, when brushfires literally came within 50 feet of our house—and were stopped by the greenbelt.)

Protip: if you’re having trouble with your HOA, the easiest way to get them off your back is to learn Morse Code and get your ham radio operator’s license. Hams are protected by the FCC as part of the critical communications infrastructure of the USA, so if you wanted to, say, put a 90-foot-tall radio antenna in your front yard, the HOA can do absolutely nothing about it. Threatening to do that will shut them up good and fast.

Anyway, what does an HOA have to do with getting too big?

Plenty. Most HOAs prohibit operating a business out of your home. Now, this isn’t usually strictly enforced. They don’t care if you have a home office or a studio, or if you’re shipping some eBay or Etsy stuff out of your house, or selling a few hobby things you make in the garage.

But when you have two employees coming and going every evening, 7 days a week, with garage lights blazing and music blaring…well, that’s a different story. It was only a matter of time before the HOA would start complaining. And since the city doesn’t really like businesses being operated out of homes, they could absolutely enforce it.

So we had to look at moving…and soon.

7 Figures in a Garage, and the Reality of Having Your Own Business

What’s the limit of a garage business? A lot higher than you might think. When I finally started looking for space, we were still only using 1/3 of a 3-car garage for “production and shipping floor.” In that space, we’d just cracked seven figures in sales.

A note on numbers: Schiit is a private business, and I usually don’t discuss revenues, because (a) it’s gauche, (b) we are not required to, and (c) it’s really not that important.

However, in this case, I’m using a specific number to illustrate what you can do with a self-funded, home-based manufacturing business. Remember, we started this with \$10K. 18 months later, we’re into 7 figures annually. In a garage.

This isn’t intended to be bragging. This is intended to be inspiration for you. Starting your own business is absolutely do-able—without taking loans, leasing tons of space, hanging your ass out for bankers, gambling on delivering a crowdfunded product on time, or otherwise betting big on getting big.

But that brings us to what I call The Reality of Having Your Own Business.

In my opinion, the difference between working for someone and having your own business comes down to a single phrase: When you have your own business, you can’t say, ‘that’s not my problem.’

Sounds too simple? No. Sit back and let it sink in.

When you’re working for someone, you’ll usually have a fairly well-defined role. No matter if you’re a clerk or an engineer or a COO, in all cases, you’ll know what’s expected of you. A clerk isn’t expected to design a new product—that’s not his problem. An engineer isn’t expected to write the ad copy for the new line launch—that’s not his problem. A COO isn’t expected to stand up in front of the press when the firm does a billion-dollar acquisition. It’s not her problem.

“Well, I’ll hire people to take care of marketing, production, operations, etc,” you say.

Yes, and hiring them is your problem. As is budgeting for their salaries. And keeping them motivated.

And who do they report to? You.

And I mean, everything. In this book, I’ve covered only the top level stuff—engineering, putting things together, dealing with production problems, space. But let’s look at a bigger list of things that will be your problem, if you start your own manufacturing biz:

• Engineering Documentation
• Prototyping
• Schematics
• PC board layout
• Testing
• Compliance (FCC and the like)
• Production procedures
• Testing procedures
• Documentation and archiving
• Managing changes
• Pricing
• Functional Items
• Product manuals
• Product description
• Product setup guides
• Driver installation guides
• Packaging
• Packaging testing
• Design
• Industrial design
• Packaging design
• Collateral design
• Marketing
• Website structure, functionality, copy, design
• Product “sell”copy
• Press releases
• Photography
• Informal communications (blogs, forums, etc)
• Review samples
• Sales
• E-commerce capability, functionality, testing
• Sales through other sites
• Sales through dealers and distributors (ack)
• Accounts receivable (if you are dumb enough to give terms)
• Vendor interface
• Purchase orders
• Accounts payable
• Account setup
• Wire transfers
• Customers
• Incorrect orders
• Technical questions
• General questions
• Customer service
• HR
• Hiring
• Firing
• Vacations
• Benefits
• Shipping
• Choosing shipping providers
• Negotiating rates
• Setup for e-commerce
• Mis-shipments
• Lost shipments
• Accounting and Taxes
• Bookkeeping
• Forecasting
• Federal taxes
• State taxes
• Sales taxes

Yep, it’s a long list. And it’s not complete. Not by a long shot.

Now, it may seem I’m relatively cool on the prospect of starting your own business. No. Just realistic. It’s a ton of work—but I’ll re-iterate. It’s the biggest, most satisfying thing you’ll ever do. At least for me. But I’m weird.

Again: it’s always your problem. No hiding. No passing the buck.

If you’re cool with that, go for it. Create your own business. Own it. Grow it. Enjoy the great times—and there will be plenty. And work through the tough times—those will happen, too. Hire and build and make it easier on yourself.

But don’t do it because you think it’s going to be easy. Or because you think you’ll have more freedom.

Because, if it’s your business, it’ll always be your problem. Until you decide to sell it and get out. And when you’re small, everything is your problem.

Including looking for space.

Which is another of those invisible lines that, once you cross it, you won’t go back. It’s a big step that takes you from “This may be a hobby,” to “OK, we’re committed, this is a real business.”

When I started looking for space to lease in early 2012, I employed a proprietary algorithm using non-Fourier wavelet mathematics, known as DBLFSN, as well as a well-known methodology called BSLA. DBLFSN and BSLA rapidly narrow the lease candidates to a handful of locations best suited for a business’ use.

Yeah, I’m having fun with you:

DBLFSN: Driving By Looking For Space Nearby

BSLA: Borrowing Someone’s Loopnet Account

Here’s the deal. I was still working daily at Centric, which is located in downtown Newhall. Being lazy, I wondered if there was anywhere nearby that we could use to house Schiit. So that’s where I started. And, being observant, I noticed a building only a block away that might be a good candidate. Looking it up on Loopnet confirmed that it was about 1800 square feet, but didn’t give a lease rate.

Now, 1800 square feet is kinda big for getting started with a small company. But it’s not really that pricey. At a standard industrial lease rate of, say, \$0.60, plus \$0.10 CAM, you’re looking at under \$1300 a month. Plus electricity, water, gas, etc.

And this space had one thing going for it: the building was a schiithole. It was a mixed siding-and-stucco one-story building with holes kicked in its sides, dry-rotted eaves, peeling tan paint that revealed 5 decades worth of colors underneath, a nasty potholed blacktop parking space or two…

In other words, it would probably be almost free.

I was thrilled. It seemed like the perfect place. I called the realtor listed on the sign. “Hey, that building on the corner of Railroad and 6th, is it available?”

“Yep,” said the realtor. “What are you planning to use it for?”

“Um…I have an audio company, we’d be doing some light manufacturing—“

“Manufacturing, nope,” he cut me off. “It’s not zoned for that.”

My heart sank. “We’re not talking machine tools and stuff. Just assembly.”

“No can do,” the realtor told me. “You start doing manufacturing in there, the city’s going to come in and shut you down. The whole thing is a mess. We’re now technically a flood plain, and the whole Enterprise Zone thing is screwing everything up, we don’t know exactly what we can do with that building, period.”

“There’s no way we can make it work?”

“Nope,” he said. “Sorry.”

Stupid Rules, and Types of Business Space

Okay, if you’ve never leased business space before, you’re probably shaking your head, wondering what the hell is going on here. Let me ‘splain.

What’s going on here is zoning. As in, a city divides its space, and decides what you can do in each place. Some common zones will include:

• Residential: You can only build houses here. This is where you live.
• Commercial: Only shops, thank you. Get your \$10 fancy ice cream here.
• Industrial: That’s where them crazy people build things. Like Schiit amps.

Now, some cities are crazier than others about zoning. Where Mike Moffat lives in Agua Dulce, you could probably build an 80-foot-tall purple freeform house with a 10,000 square foot manufacturing facility and a Mexican restaurant, and bring in 15 employees to run it, and the city wouldn't blink. (I’m exaggerating, of course.)

Santa Clarita, which encompasses Valencia, Newhall, Canyon Country, Saugus, etc, is about 1000000x opposite. In fact, Valencia is entirely master-planned. Which means it has big business areas full of offices and warehouses and manufacturing firms—and not a single restaurant. Everything must be in its place. And they are famous for sending their snoops around to make sure you’re abiding by the rules. Yeah, we live in a wonderful place.

And the problem was, that beautiful Schiithole was zoned for commercial use, not industrial. Commercial meant that we could have an ice cream parlor or an office there, but not a manufacturing floor, nor a warehouse.

So did we look for other space? Yeah, sure. We looked in the Valencia Industrial Center, which is where we are now. But I really, really didn’t like the idea of driving from Centric to Schiit to get things done. Remember, we had no operations people at that time, so it would be me overseeing things, Rina shipping and doing listening tests, and Eddie and Tony putting things together.

Which brought us back to that crappy little building in Newhall. The question was, how the heck could we get our hands on it?

It took two more conversations with the realtor to get him to agree to let us take a look inside the place. He still didn’t think he would lease it to us, but I guess he was either (a) too bored, or (b) pissed that the space still wasn’t moving. I still don’t know why he did it, but it was that meeting that turned the tide.

And, man oh man, it was at least as bad inside. The tile floor had been cut open to do plumbing work, then roughly cemented over. Every thing was covered in dust. A contractor was using it to store parts and equipment, and it was packed floor to ceiling with all kinds of stuff. The heating and air conditioning were nonfunctional. The layout was a weird L shape around a dirt-and-concrete yard. It was next to a barber shop and a thrift store. And the hammering of passing trains across the street made bits of the acoustical ceiling fall like snow.

“I guess this wouldn’t be all that great for an office, even,” said the realtor, looking at it with new eyes.

“It’s perfect,” I told him. “If we could just screw a few things together here.”

He shook his head. “This is commercial. For shops and such. Places that sell things.”

A sudden idea hit me.  “But we do sell things,” I told him.

“Yeah, but you’re a manufacturer,” he said. “I’m talking about shops that sell to the public.”

“But that’s what we do,” I told him. “We sell direct to the public.”

“Hmm,” he said, rubbing his temples. He clearly wanted someone in the space that would pay more than the guy who was using it for storage, but he was still scared of the city. “So people could come in here and buy one of your products?”

“Theoretically, yes.”

“Theoretically?” he looked doubtful. “How do you sell your stuff now?”

“Online, mainly.”

“Hmm. But you could sell something to someone who came in?”

“Yes.”

The realtor nodded. “Huh. Well. Let me see what I can do.”

“Great!” I said.

He frowned. “No promises.”

But somehow I knew: this would be Schiit.

I guess this is why so many small businesses fail ... most people who start them (at least if you watch "Kitchen Nightmares") seem to have no idea of what is entailed beyond having a general desire to "do something".

This series is a sobering eye-opener, given how many unexpected/unforeseen issues cropped up in starting Schiit - and this is with people at the helm who had already successfully started other businesses. There seems to be a belief in "lands of opportunity" (such as America/Australia et al.) that sheer passion and hard work is sufficient to counter any difficulty.  I'm guessing for every success story there must be hundreds of failures.

To paraphrase the old "frozen bird" joke, the upshot of this story may be "Not everything you get out of schiit is crappy.", to extrapolate from your new Schiithole digs.

When I was getting to the bottom of part 20 I was expecting a "never tell me the odds".

I never knew anything about ham radio operator’s license and the threat of installing an antenna in the front yard. I HATE our HOA...thanks for the idea. We get bitched at if we forget an leave one of the cars or the motorcycle in our driveway rather than in the garage...and God forbid if you want to set your trash cans out the "night" before the early morning trash pickup! My grandfather told me that he'd never live anywhere that he couldn't paint his house the color he wanted (nothing stupid/outrageous) or park his car overnight in his own driveway...I should have listened, but we loved the house. Live and learn.

I find myself really looking forward to Wednesdays new chapters, thanks Jason!

So America invented Home Owners Associations.......

HOAs have also driven me to look for a new home that is far removed from one and I intend to paint it pink when I get the chance.

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