Feb. 6 2013 08:32 AM

For months, the local business marketed itself by recording bands for free

The Paragraphs work on a song, “Turns to Dust,” at The Lost Ark Studio.
Photo by Robert Sanchez

Jesse Lee Hofbauer wasn’t expecting much when The Paragraphs got invited to The Lost Ark Studio last year. Boasting a dizzying collection of vintage gear, the Pacific Beach studio seemed like it would be too pricey for his humble band. Hofbauer figured they’d stop by, look around a bit and then go home.

But when The Paragraphs visited the studio last November, money wasn’t an issue. Working with Mike Butler, The Lost Ark’s in-house engineer, the band spent about three hours recording their song “Turns to Dust.” To play his parts, Hofbauer picked out a black-and-white ’60s Silvertone from a room full of hollow-body guitars.

“I was completely thinking, OK, well, after this session’s over, I don’t even know how much this is going to cost us,” Hofbauer recalls. To his surprise, though, “They didn’t charge us anything.”

The Paragraphs aren’t the only band who’ve gotten a killer deal from The Lost Ark. For months, the studio’s brought in dozens of artists to record singles for free, as part of a compilation series—last year, the studio released a new single each week, featuring a different artist. In the process, The Lost Ark has exploded in popularity, with musicians raving about its sound, equipment and low rates.

“I think anyone that gets to record in a space like that is getting hooked up, even if they’re getting charged a normal rate, because it’s so much better than any other studio, in some ways,” says Brian Holwerda of local country-rockers Blackout Party, who recorded their 2011 album Closed Mouth Don’t Get Fed at The Lost Ark. “They definitely have helped out, I think, every band they’ve worked with.”

But while the studio seems to be helping lots of musicians, some studio owners and engineers have bristled at the novel approach of The Lost Ark’s owner, Paul Cavanaugh. They say The Lost Ark’s low rates have made other studios suffer and wonder whether Cavanaugh’s flashy studio is actually helping the scene.

“What about a tour van? A publicist?” says Brad Lee, a veteran local musician who owns the label Loud + Clear Records and Clairemont studio Stereo Disguise Recording Laboratories (SDRL). “Start a record label and help these bands put out CDs. Pay a booking agent.”

Cavanaugh declined to be interviewed for this story and rebuffed several requests from CityBeat to visit The Lost Ark. But people who’ve been to the studio describe it as a musician’s wonderland, with guitars hanging on the walls, rooms full of gear and a picturesque seaside view.

John Meeks, a songwriter who helps Cavanaugh recruit bands to record, says The Lost Ark started in early 2011. Cavanaugh opened the studio with former Buck-O-Nine bassist Scott Kennerly, Meeks says, and snapped up loads of vintage equipment when he began working with Butler, who’s known for making roomy live recordings.

Meeks says that Cavanaugh got the money to fund the studio when a software company he founded, DefenseWeb Technologies, was acquired by Humana, a billion-dollar healthcare company, in 2007. The way Meeks describes it, Cavanaugh and Butler are building a musical utopia, where great musicians can achieve their recording dreams without worrying about equipment or money.

“They only want to do records of people who they believe in, who they think are doing music for the right reasons, or who have something special to offer, or who have a lot of drive,” Meeks says. “They don’t want to just do anybody to try to make a buck, because they don’t really, necessarily have to make money off of this.”

Musicians who record there are urged to help each other—and The Lost Ark—by hyping the music that comes out of the studio. Cavanaugh seems particularly enthusiastic about social media. In December, in a mass email to musicians who’ve recorded there, he urged them to post links to the studio’s Soundcloud page in a final push for the holidays.

“I know you all know about how to reach your fans, build a fan base and such, and that we’re fairly new to it—but if we’ve learned anything, something I’m sure you all know—it’s not just a matter of having fans, it’s a matter of taking care of your fans—and if you feed your fans, they will feed you,” Cavanaugh wrote in the email, obtained by CityBeat. “So if you haven’t ‘fed’ your fans music lately, and more specifically the single we worked with you, well it sure would be great if you could look back, dust it off and send it out there again!” 

The recording business can be tough: Overhead costs are high, studios have to compete with home recording technology and the market is unpredictable. While several studio owners and engineers say their businesses haven’t been affected by the rise of The Lost Ark, a couple have been frustrated by the studio’s bargain rates.

“I think Mike Butler is very good at what he does and his arrival in San Diego has had a considerable impact on the overall quality of what gets done in this town,” Ben Moore, a freelance engineer, tells CityBeat in a Facebook message. “Unfortunately, the subsidization aspect of the Lost Ark business model has done significant damage to the low-end and mid-range studios that I frequent with my independent clients. It’s very difficult for a quality facility in Clairemont, for example, to compete with a beachfront recording studio that doesn’t charge its clients for studio time.”

After months of hooking artists up, it looks like The Lost Ark is shifting to a more traditional business model. Last Friday, Cavanaugh emailed Hofbauer, the frontman of The Paragraphs, telling him that the studio is now going with a standard “day rate” like other studios in town, Hofbauer says.

Though it may not have been economically sustainable, The Lost Ark’s free recordings have been a boon for publicity. Hofbauer says The Paragraphs now want to record an album there—even if they don’t get a sweetheart deal.

Email peterh@sdcitybeat.com or follow him on Twitter at @peterholslin.