diff --git a/setup b/setup
index 35a4a05..9676bb3 100755
--- a/setup
+++ b/setup
@@ -40,6 +40,7 @@
 		if [ -n "$target" ]; then
 			if [ "${name}" = "${target}" ]; then
 				echo "Machine ${target} found in ${tmpl%/conf}"
+				mkdir -p ${build_dir}
 				TEMPLATECONF="${tmpl}" source \
 						oe-init-build-env ${build_dir}
 
@@ -68,7 +69,7 @@
 else
 	bld_dir=$2
 	if [ -z "$2" ]; then
-		bld_dir="build"
+		bld_dir="build/$1"
 	fi
 	machine $1 $bld_dir
 fi