At Krazy Karaoke, everyone can sing

The Shiromas have been so successful that they plan to expand to the mainland

STORY SUMMARY »

Malcolm and Lynn Shiroma have built a thriving family-oriented karaoke business and are preparing a strategic expansion to the neighbor islands and mainland over the next five years.

The husband-and-wife team, who anticipate gross sales to exceed $1 million this year from Krazy Karaoke, are looking at franchising opportunities, which is expected to take the company to the next level.

The couple have found a niche in the competitive karaoke market, focusing on children's parties, baby showers and birthdays at their two locations at the Pearl Kai Shopping Center and on Young Street.

The Shiromas also juggle a second career in real estate, operating Property Center Inc. -- a sales and property management company -- from the second floor of the Young Street location.

While unexpected, being involved in a music-related career comes natural to the Shiromas. Lynn is a former a backup singer with Liz Damon's Orient Express, a local band from the 1970s, while Malcolm was a trombone player for a rock band -- known as Warning -- while at Kaimuki High School.

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Malcolm and Lynn Shiroma are known by some around town as crazy -- but that's not a bad thing.

Patrons identify the couple with their business, Krazy Karaoke, which has been an overnight hit over the past few years.

To sing along » Owners: Malcolm and Lynn Shiroma. » Hours: 11 a.m. to midnight on weeknights; 11 a.m. to 2 a.m. on weekends. Open daily except Christmas and Thanksgiving. » Aiea: Pearl Kai Shopping Center, 98-199 Kamehameha Highway, H-13 (nine rooms). Phone: 484-0269. » Honolulu:1308 Young St. (15 rooms, including super room that seats up to 60 people). Phone: 591-8843.

"If we go out in public, people don't call us by our names, they'll say, 'Hey, Krazy Karaoke,' " Malcolm said. "People enjoy themselves, that's why they have good memories of us."

So much so that the husband-and-wife team is anticipating gross sales to exceed $1 million this year for their two locations at the Pearl Kai Shopping Center and on Young Street in Honolulu. That compares to sales of $600,000 in 2007.

In addition, the couple is preparing to expand the 9-year-old venture since receiving numerous requests for franchising opportunities. They are looking to franchise to the mainland, starting with Las Vegas, within the next five years, and are seeking to open another location on Oahu before branching out to Maui and the Big Island.

The Shiromas have built a thriving karaoke business by striving to be unique and family oriented, focusing on children's parties, baby showers and birthdays.

It was by chance that the couple, both former band members, fell into the karaoke industry. Both have 20-year careers in real estate and also run Property Center Inc. -- a sales and property management company they opened in 1988 -- from the second floor of the Young Street location.

It was while working in real estate that they cultivated their passion for the hobby when entertaining clients from Japan at a karaoke establishment at Joy Square in Waikiki.

"Once we started going it was hard for us to stop because we enjoyed it so much," Lynn said, adding that they found themselves singing karaoke three to four times a week in the 1980s and early 1990s. "We used to practice a lot, tape ourselves, play cassettes and do critiques to try to improve so we wouldn't embarrass ourselves when we were with real estate clients."

But the couple is already musically inclined. Lynn is a former backup singer with Liz Damon's Orient Express, a local band from the 1970s, while Malcolm was a trombone player for a rock band -- known as Warning -- while at Kaimuki High School.

Still, working to improve their karaoke skills eventually paid off when a real estate client asked them to manage his fledgling business -- Karaoke Box -- which later changed to Hawaii Stars Studios.

At the time, they knew nothing about running a retail venture, and at first struggled with basic operations, including how to close the register. The couple learned what needed to be done by their employees, who were college students with previous retail experience.

"We made it grow into six locations not knowing what we were doing," Malcolm said. "It was unexpected and random."

The experience gave them the confidence to take a shot at their own business when the opportunity arose to take over the existing operation at Pearl Kai, which they managed for eight years.

The couple, who married in 1996, invested $100,000 in 1999 into the Pearl Kai location. In 2005, they spent another $700,000 to gut and renovate a second stand-alone building on Young Street. The company that started with only four employees today has 15 workers.

Between the two businesses, Malcolm and Lynn work 12 to 16 hours per day, handling real estate in the daytime and karaoke operations in the evenings.

"This is our first home, our home is second, but it is so rewarding," Lynn said, adding that at least 90 percent of customers leave happy.

The Shiromas eclectic and detailed style can be seen throughout the more than 6,000-square-foot Young Street establishment, with customers greeted by a talking Elvis bust atop an intricate miniature band that actually plays Japanese music and sings on track.

Album covers and large posters of popular musicians line the walls, while miniature records dangle from the ceilings.

The couple has purposely stayed away from the bar concept found at other establishments, and instead try to encourage more disabled and elderly customers to enjoy karaoke for discounted rates. Arch of Hawaii, Loveland Academy and Easter Seals Hawaii are among the groups that have patronized the business.

Customers say what sets it apart from other karaoke businesses is the owners' dedication to a quality environment.

"It's way cleaner, has more songs and it's right next to the nightlife," said Sassy Fely, 25, who sings karaoke once every two months. "It's kind of like they learned from the (last location) so they're more organized, they're more friendly, they're more experienced and know what to expect already."

Regular customers include celebrities, lawyers, mortgage brokers and doctors, some of whom sing for relaxation therapy, according to Lani Naki, manager of Krazy Karaoke at Pearl Kai.

She's also seen someone propose in one of the rooms and another couple actually say their vows there.

"You see all walks of life, all different ages, they all have one thing in common -- they love to sing," said Naki, who has worked there for nine years. "Some can't, a lot of them can, but it makes them real happy."

Krazy Karaoke has nine rooms at Pearl Kai and 15 rooms in Honolulu. The rooms can seat one to 60 people, with prices ranging from $12 to $160 an hour, depending on the time and day.

Malcolm tries to keep on top of the latest hits with more than 40,000 songs at each location, including broadway musicals, children's tunes, gospel, and Filipino, Hawaiian and Japanese melodies. The couple have invested between $100,000 to $150,000 in equipment, including songs.

While the biggest challenge has been finding and retaining good employees -- a universal problem for most small businesses -- another obstacle is obtaining the latest songs in a limited market.

"There's not too many Hawaiian songs available in karaoke, but there's nothing we can do about it," Malcolm said. "We're at the mercy of whoever is going to make karaoke songs."

So when a new song is produced, the family immediately snatches it up, purchasing about 30 songs a month.

The mom-and-pop operation also tries to stay ahead of the curve in terms of technology. Malcolm wrote his own proprietary software for their karaoke-on-demand system, which allows customers to select and input multiple songs through a remote control. The system also allows singers to pause and rewind tunes and use a voice-over function to learn a new song.

He is currently working on the latest version of the software, which would allow patrons to choose and program their songs via the Internet.

Despite the long hours, their passion for music and making people happy is what drives them to continue to expand in the karaoke field.

"We just love this business," Lynn said. "It's very rewarding when you see so much joy."

The "addicting" nature of the business likely has something to do with the environment as well.

"We try to be different, warm and friendly and hopefully that'll get across to customers," Malcolm said. "It's just a happy business and we're glad we're in it."