Allen Stone was ending 2015 with a good “problem”. His startup, PetCru, a pet care service in Austin, Texas, had taken off after its launch a year earlier. With almost 200 customers and more than 300 pooches and kitties to tend, Stone couldn’t justify having his six-person team work from coffee shops and their homes. “We needed a work space, but we weren’t big or established enough to commit to traditional corporate rents,” he says.
The answer was moving into Orange Coworking, which charges $40 per week per person, for part-time use. After a few trial days, Stone knew the laid back yet productive culture was perfect. “We can make calls, use the conference space for our weekly meetings and conduct our daily routine,” says Stone, who launched PetCru while he was a full-time employee at the online legal service LegalZoom. “I can add on or break the monthly contract depending on our growth.”
In New York City, Katie Kapler, co-founder of CourseHourse, which she helped launch while working for the small business lending platform Biz2Credit, co-leased the office space of a company said to excel in customer acquisition. The big incentive, says Kapler – whose startup helps people discover and enroll in local in-person classes – was sharing each others’ networks for potential clients. “Given that we’re both the same size and [at the same] stage, we benefited from one another’s learning around hiring, management and culture,” she explains. “We could also co-lease a larger, better office space than either of us could afford alone.”
From corporate to co-working
Stone and Kapler exemplify the trend of side hustlers ditching traditional corporate environments for shared, collaborative ones. Exact numbers of hustlers using co-working spaces are hard to track, but Mark Walsh, associate administrator of the US Small Business Administration’s (SBA) Office of Investment and Innovation, has seen it steadily grow since the dot-com era, when Yahoo’s Jerry Yang famously sat in wall-less, open cube, incubator-like workspaces.
“America has a rich legacy of shared, flexible work spaces,” Walsh says. “Now, offering collaborative space arenas has become big business.” As part of the co-working and peer-networking trend, the SBA launched an annual competition in 2014 to award operating funds to select incubators and tech accelerators.
Walsh says shared workspaces promise entrepreneurs in the creative, internet technology (IT) and service sectors three things: collaboration that reduces duplication of efforts, infectious energy and the shared innovation that emerges from casual connections.
Hustlers also find that thriving incubators and accelerators provide networking opportunities. Don Addington, president and CEO of Mobile Labs, which creates mobile-app testing products, moved in July 2015 from a regular office to Atlanta Tech Village, a huge, thriving startup community.
Addington says while the rent is comparable to his former location, the 30-day commitment is less stressful given his business is a startup without a proven business model. He finds the environment upbeat and highly entrepreneurial. “We’re all startups, developing code and trying to solve the world’s big problems,” Addington says.
Another benefit: lawyers and venture capitalists (VCs) visit the office to hear pitches. “The suits come to us, and I gain exposure to VC firms and services I’ve never heard of,” says Addington, adding his company is expanding into Europe, Asia and the UK, where it will also use shared office spaces. Redg Snodgrass, CEO of San Francisco-based Wearable IoT World Labs, an accelerator focused on wearable technologies, says entrepreneurs in his 15-week program feel the big takeaway is the energy. “The passion and commitment of those around you inspires you to push that much harder,” he explains.
Established companies can also motivate startups. When C2FO, a financial tech company in Kansas City, Kansas – part of the emerging scene known as “Silicon Prairie” – doubled its office space, the company designated an extra room as an incubator. “The goal is helping startups to grow – give them a leg up,” says Sanjay Gupta, the company’s chief operating officer.
So far, five startups are using C2Fo’s space. “One group was working out of a public library while others worked out of their home[s],” Gupta says. His leadership team offers mentorship for technical issues as well as business and marketing ideas. No money is exchanged, and leadership makes no request for equity. “C2FO benefits from the added exposure to startups, talent and a good feeling of giving back,” he claims.
Tips and caveats for co-sharing
Despite the trend, Walsh says the pendulum could shift from collaborative spaces. For one thing, things will reach saturation. Many spaces exist, but more immediately, he says he suspects there will be a growth of cocoon-like spaces offering visual and auditory privacy. For those considering co-workspaces for their side hustles or startups, here’s expert advice:
- Know that some co-working environments can breed drama for human resources, since co-workers might know more personal information about one another and occasionally start conflict, says Walsh.
- Watch for intellectual property theft. When sharing space with other companies, use screen savers with reduced time and monitors with visual recognition technology. Ensure your monitor goes into lockdown when you step away, Walsh urges.
- Understand that co-working spaces are more progressive and therefore prone to change constantly, says Snodgrass – so embrace it.
Note that despite the benefits, the shared work environment can feel transient and less like a home for your team, says Kapler: “To fully celebrate your company’s personality and embody your corporate culture, there’s something uniquely unifying about having a space to call your own.”
This content is brought to you by Squarespace. Receive 10% off your new Squarespace signup with offer code SIDEHUSTLE.
guardian.co.uk © Guardian News & Media Limited 2010