Drinking, Skills, Banking and Venture

This Weeks in Coworking for September 17 - 30

Hey, BarKeep. Does your cowork space have a drinking problem?

While it’s nice and a very cool perk to offer beer, wine, cocktails at your coworking space, generally in the name of team cohesion or morale upkeeping, I often wonder how an HR executive would view the issue? Is there additional liability insurance one must procure? Is it hidden in the membership terms and conditions whereby the coworking space is immune to lawsuits? This article on Covene’s blog goes a little deeper.

Learning skills faster, making more connections, feeling inspired and in control

These are a few of the reasons given by employees that are also pushing corporations into taking the leap into coworking. But while the overall ROI is still difficult to measure, innovation and learning from others seems to be enough of an outcome for the forward-thinking co’s to take the plunge.

Capital One Banking, Free Wifi and Peet’s Coffee?

I watched a Capital One television commercial over the weekend, you know, the what’s in your wallet people, and was shocked to see them advertise a coworking/banking concept called Capital One Cafes. Just to be clear, I was more shocked at the fact that a brand was spending big money on a national ad campaign, not necessarily at the concept itself. After all I get that banks want to be convenient and to be where the customer is, but personally I’ve never been a fan of banking within grocery stores. Such a terrible experience. This one might be a better fit. Reminds me of the German coworking/coffee concept, St Oberholz. Additional insights from St Oberholz’ Manager here.

WeWork is launching a venture fund to invest in the future of work (article below)

Emily Keeton, who joined WeWork last year as global head of mergers and acquisitions, is now managing director at WeWork Creator Fund. Ms. Keeton is planning to assemble a team of about five people behind the effort, according to a person familiar with the situation.

The move is another way in which WeWork is tapping its significant funding and revenue for expansion purposes after the company and its subsidiaries gathered more than $6 billion in equity and debt funding.

WeWork has already been an active acquirer of startups over the past 12 months, buying companies including education startup MissionU, marketing software specialist Conductor and group-organizing platform Meetup.

The size of WeWork’s fund couldn’t be determined. It has started taking outside capital that will add to the balance-sheet resources it is dedicating to the fund, one of the people said. The fund has already started evaluating startup deals, the people said.

Corporate funds are fairly common at more established companies, but some private technology companies have created them. Examples include enterprise software startup Slack Technologies and drone startup DJI, both of which teamed with traditional venture firms for their corporate funds.

WeWork Creator Fund will seek out social-impact startups, as well as those in the future of work category, one person said. Those will include technologies for human resources, recruitment, training and education, employee experience and real estate.

The fund also will house existing investments that WeWork has made through its $20 million Creator Awards initiative. Under the program, the company funded about 50 companies through a “safe agreement for future equity” structure, which entitles WeWork to equity in the event of a future financing.

The new fund might be used for additional investments into Creator Awards entrants, according to one of the people familiar with the matter.

The New SaaS, a Primer & Catchup

This Weeks in Coworking for September 1 - 15, 2018

The new SaaS - Space as a Service

“Every landlord, whether multifamily or office, is going to have to embrace the fact that tenants now have the power. They want amenity rich, tech savvy buildings with great programing and communications. Employees want it. Tenants want it. This generation in particular expects it. Landlords will have to completely change the way they build, operate and communicate now and forever.”

Bringing people together

Okay, so you’ve added some flexible office space inside your building or you’ve opened up your coworking concept, so now how do you get folks to mingle or just get to know each other, you know “Accelerated Serendipity? That was one of the questions discussed at FlexOffice 2018, hosted by NAIOP and the Global Workspace Association. With the lines between life and work blurring, all panelists seemed to agree that the answer lay somewhere in hospitality amenities and service. Just keep things in check.

Latest explainer on what a coworking space is

I’m constantly having to explain coworking. Even to folks who say they know what it is. And even to those in the Real Estate and Property Management side of things. The good news is that there’s always someone writing up a much better explanation than I. So here you go; this is Kyle Pinto’s take, he’s Head of Community at ChargeSpot.

A trusty guide to being a better coworking member

William Frazier bullet-points some smart reminders for how to deal with fellow coworkers and how not to be “that guy". Interestingly, six out of the ten items settle around food and drink. Something to be said about how food and drink help create a community, which is after all the goal of a coworking space. Coffee is a given. Beer is commonplace. But should spaces provide lunch? A Happy Hour? Cocktails? How far into restaurant-space should they nudge?

Cool branding

Make Lemonade is a women’s only space in Toronto, Canada. Not only is the design of their space spot on for their demographic, the entire vibe of making lemonade (when life throws you lemons) is a terrific inspiration and battle cry for fellow comrades in arms. Well done Rachel Kelly, founder and your tribe of lemonaders.

Travels, Coworking in Europe

This (month) in Coworking for August 5 - 31

Coworking London, Amsterdam & Brexit

Having just returned from the great cities of London and Amsterdam, one thing I can say for certain is that Brexit is causing some uncertainty. And while London is now the largest flexible workspace market in the world, and there doesn’t seem to be any slow down in coworking uptake, the word on the street and pubs say otherwise. Purely anecdotal, but some founders I spoke with are leaving to set-up their startups in Dublin, Berlin, and Amsterdam. Just mark your calendars March 29, 2019.

Only 6 markets account for half of all coworking space in US

Combined, the six gateway markets - Manhattan, Los Angeles, San Francisco, Chicago, Washington, D.C., and Boston - dominate the coworking subsector, and New York City leads the pack by a wide margin. As of mid-2018, the Big Apple accounted for 12 million square feet of coworking space, 10.7 million of which is located in Manhattan. Los Angeles follows with 3.4 percent. All told, the six markets account for 23 million square feet, or roughly half of all coworking offerings. 

Workonomy, Office Depot’s attempt at a Coworking Space

Office supply stores are like toy stores for me (and quite a few grown-ups I know). So when Staples announced a coworking partnership with WorkBar earlier this year and with Office Depot opening their first location last week in Los Gatos, California, I was excited at the idea of working from inside an office supply store. The photos and the renderings look terrific, but still, when I walk into my local Staples and Office Depot, just can’t see myself working there. And really, what kind of community will flourish? Incidentally, Staples/WorkBar charges a monthly fee of $130, Office Depot's Workonomy charges $40 for daily use to $750 a month for a private office.

Franchising?

One opportunity for coworking operators to scale up and grow quickly is through franchising” says Dallas-based Ryan Hoopes, a senior associate at real estate services firm Colliers International. And while only two major coworking operators so far, New York-based Serendipity Labs and Naples, Fla.-based Venture X, have leveraged this strategy, he expects more coworking operators to adopt the model. Actually, I found another one - Office Evolution. Except when you look at this site and the prospectus, it’s so cookie-cutter that it makes one wonder can, and should, coworking really be franchised? I guess we’ll wait and see.

Additional bullet-points from Cushman & Wakefield to reflect upon this month:

  • Inventory in this office niche has increased by 5 million square feet every year over the last three years

  • Before you go to bed tonight, another 15,000 sf of coworking space will have opened in the U.S.

  • Investors are comfortable with a coworking space ratio of 15-30% of a building

  • This ratio is increasingly perceived as a strategic necessity by landlords and investors

  • Flexible office space will triple in size—representing 5-10% of office inventory in many markets

  • Coworking demand is strong, but only 30-40% is additive

And my favorite takeaway:

  • Coworking is well-positioned to weather an economic downturn

IWG, WeMRKT, Labs, Location

This Week in Coworking for July 29 - August 4

BREAKING: No Buyers for IWG/Regus

After months of protracted courtship by multiple suitors, IWG Plc decided it doesn’t want to be sold at a price that private equity firms are willing to pay. The shares plummeted. Ouch. The world’s largest serviced office network (fancy name for coworking or coworking 1.0) is now valued at a little over $2bn. Compare that to WeWork’s valuation of $20bn. Now really, what the heck is going on?

WeWork is getting into retail

Good or bad? Keep in mind, it’s only in their buildings (for now), but as a distribution outlet for some of their lucky members it makes a ton of sense. “Traditional retail is changing, and as brick and mortar locations are dissipating… right now (weWork has) 300 buildings that members can distribute to”, so says Julie Rice, Chief Brand Officer at WeWork.

WeWorkLabs

Along with access to workspace, WeWorkLabs offers programming, mentors, experts, and intros to enterprise businesses partners. This is an obvious WeWork flavored version of the hundreds of incubators and accelerators out there and is a great pipeline for retaining members. It’s also a great strategy for workspaces targeting startups and founders, but as long as you have the access to the right network of advisors. And that’s the hardest part of this whole thing - the right mentors, advisors, developers, project managers are busy doing their own thing - right?

Location. Location. Location

People want, and need, something different from the traditional. The space around you influences your perception of reality, your self-worth and level of happiness. Working in a large, empty space transmits feelings of a business that is lacking. Coworking environments allow for a kind of cross pollination of ideas, something that can only be achieved from a collaborative workspace vibe. AndCo is a startup in London that’s taking the Spaces model from the US and applying it in the UK.

The Modern Workplace

Here’s an interesting stat: 60 per cent of under 35's place greater value on the ability to work remotely over generous holiday allowances. This according to the latest whitepaper by Ingram Micro Cloud and Microsoft, The Modern Workplace. Firms that are unable to provide this next generation workforce with the tools they are accustomed to risk losing employees to their more tech savvy competitors. Yep, the motivations of today’s talent has changed from previous generations. Choice, flexibility, and experiences at work are vital factors in job satisfaction for millennial workers - outweighing even salary (for some).

The Role of Community Manager

According to architect and coworking consultant, Andrea Garcia, the role of Community Manager was basically unknown a few years ago. But thanks to technology and the rise of the collaborative economy, the CM is a key hire in the success of any coworking space. What does she look for in a succesful CM? Someone who

  • Defines the philosophy of the space

  • Connects members

  • Creates internal dynamics

  • Stays updated on all the trends and news relevant to your membership

  • Speaks less, listens more

  • Is the brand of the space

  • Connects with other community managers

Cannabis, Mall Space & more

This Week in Coworking for July 22 - July 28

Following up from last week's story about Green Street and Paragon Space, the Cannabis-related coworking spaces in Los Angeles, apparently there seems to be a major land-rush for offices, warehouses and retail space in the blooming marijuana field. No surprise really as the stats are pretty eye-opening; by 2020, cannabis will rival the $7bn California wine industry growing to $75bn nationwide in 2030.

Note: as I see it, the opportunity for coworking operators here is to simply offer innovation, technology, and business development. You know, what successful spaces should normally provide.

Forward-thinking mall owner PREIT is opening a coworking space in their upscale property in Cherry Hills, South Jersey. Offering the standard desks, offices, conference rooms, and entrepreneur-centered programming, PREIT considers the space and partnership with incubator 1776 the “wave of the future”. Taking up 11,000 square feet next to the likes of Nordstrom, Apple, Zara, Hugo Boss and The LEGO Store, 1776 hopes to curate a mix of retail-focused startups to give them direct access to retailers and consumers for their ideas.

Not sure about you, but most folks I talk to have never heard of coworking. Which is exciting as an entrepreneur and getting in early is your thing but not so much if you’re trying to attract new members (or even investors) and you need to go through your Coworking101 pitch deck. Finally, some help by way of a short story on coworking on a mainstream media outlet, CBS News. Yay.

Freelancers make up almost 40% of the American workforce and the majority of a coworking space’s membership. Yet government and the employment laws made over 75 years ago, still favor W-2’s over 1099’s. So it’s a good thing that the IPSE U.S. – The Association of Independent Workers – was founded. The organization aims to create a political voice for independent workers—addressing issues such as the high cost of health insurance and the hazards of unsteady income.

Finally this week, Distinctly Creative, a niche-oriented coworking space is expanding its footprint and services in Brentwood, Maryland and they’re taking the crowdfunding path to help make it happen. Howard grad Morgan Davis wanted to create a safe space + community for black creative entrepreneurs to grow professionally & personally and what began as an Instagram Page is heading to a 3,000 square foot space about 1 mile southeast of Washington, DC. Here’s Morgan’s Indiegogo page.

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