6 Life Lessons from Coworking Founders

6 Life Lessons from Coworking Founders

A panel of veteran coworking owners and operators shared war stories experienced when scaling their respective businesses at a recent workshop presented by the Global Workplace Association.

Exchanging sometimes painful lessons learned were panelists Ashley Buckner, SVP of Sales and Operations of Carr WorkplacesBill Jacobson, Founder of Workbar; Justin Stewart, Co-founder and President of Industrious; Shlomo Silber, Co-Founder, and CEO of Bond Collective; and Kane Wilmott, Co-Founder, and CEO of iQ Office Suites.

GWA Executive Director Jamie Russo moderated the discussion, which included perspectives from both entrepreneurs and corporate players. Among the highlights:

1. Stick with what you know. Don’t wait too long to hire the right help.

Shlomo Silber and his partner come from a building and construction background and figured they could bootstrap the work on their first spaces themselves. But having to manage construction, design, and management quickly brought them over budget, eating into their rent-free savings.

They pivoted to a new strategy and put together an infrastructure, working with a contractor, design team and landlord to design, build and lease the space.

While it may have cost more up front, it supported the expansion they were eager to undertake. Silber admitted the move ultimately stunted their growth, but fortunately, it was only their second space, which brought up a related lesson: make your mistakes early and learn from them. With four locations currently in operation, Bond Collective will have eight open by 2019.

Real estate veteran Kane Wilmott and his partner recognized they loved doing deals but not managing construction projects. As anxious as he was for a more detail-focused manager to take things off his plate, Wilmott was not sure he wanted to pay the price.

“Those credentials come with a lot of money,” Wilmott recalled of the construction manager they ultimately hired, a smart MBA with an engineering background.

“We thought ‘Is this worth it? Is it sustainable?’” But when they looked at it in the context of $5 million project budgets, where one small mistake could cost a month’s rent, it was well worth it, Wilmott admitted. Not only did it allow iQ Office to escalate construction, but the expense of the manager’s expertise was also absorbed by his ability to manage risk and avoid expensive mistakes.

At Workbar, founder Bill Jacobson recognized that marketing was important but somewhat elusive for his team. A partnership with Staples catalyzed a new marketing approach. Nervous about being swallowed up by a behemoth brand, Workbar stepped up its marketing efforts.

“We hired an expensive branding firm on a project basis and brought on a marketing person who can really talk corporate marketing,” he recalled.

While the corporate marketing person was helpful to the project, it was a difficult cultural shift and the position was eliminated in favor of a contract model. “Now marketing is outsourced, knowing it’s not a core competency of ours.”

2. The importance of timing in big hires.

Finding the optimal time to hire key staff was a common challenge.

At Bond Collective, a COO was hired “way too early” according to Silber, probably before they could really afford them.

However, others learned that waiting too long to hire internally or contract with consultants could lead to dire consequences.

“If something isn’t working, whether it’s a contractor, consultant, or employee, you don’t want to wait till it is completely broken, “shared Ashley Buckner of Carr Workplaces.

Lest “then you make the desperate hire,” added Jamie Russo.

3. The importance of cultural fit.

Most panelists learned lessons the hard way about the undeniable value of cultural fit in hiring.

Credentials only count for so much; the panelists agreed. More important was whether or not a new addition was the right fit culturally with the organization.

“When making ‘reach’ hires from outside, consider whether they are a cultural fit and on the same page as far as business,” advised Ashley Buckner of Carr Workplaces, a homegrown group that had expanded organically with people who had been working together a long time. “Addressing cultural fit can avoid disrupting what you’ve worked hard to do,” she noted.

When expanding from his Toronto base to a Vancouver location, Kane Wilmott hired a general manager with extensive technical and industry knowledge, having worked for a competitor.

But it was a short-lived hire.

“When the values don’t line up, they end up leaving,” he admitted. Ultimately Wilmott learned it was easier to move someone up in the organization – in this case, someone in Toronto – to the Vancouver location.

“Taking someone from the organization who already understands your culture is a bigger piece than ‘how do you run that coworking space?’” he shared. “If the person can fit from a cultural perspective, we can teach them the business.”

A similar ethos prevails at Bond Collective.

“Our director of operations, head of community and chief of staff all started as community managers and now run a team,” explained Shlomo Silber. “The best part: they really know the culture.”

“Outsiders may or may not know the industry,” he related. “But if they don’t know the culture, it can be hard to mix with the team.”

“When someone’s a good community manager, that usually means they’re talented and good at a lot of things,” he explained. “Community managers get bored. As we scale, it’s important to be able to give them that opportunity where they can grow into bigger roles.”

4. COO: Outsider. Staff Whisperer. Cheerleader. Therapist. Pennywatcher.

Outsiders can provide a fresh perspective which can be particularly valuable when cofounders are long-time friends and/or business partners.

In the cases of Industrious and Bond Collective, where the two co-founders were close friends, inevitable conflicts arose that were often resolved by a third party.

For Industrious, that role often fell to their COO who acts as both advisor and therapist when sticky points come up between cofounders, according to Justin Stewart.

“It’s difficult to start a business with your best friend,” admitted Stewart, who along with partner and co-founder Jamie Hodari hired a COO about two-and-a-half years into their operation.

Equally important to tasks of counsel and spending monitor is the COO’s role as cheerleader.

“He took a leap of faith, unlike other candidates who were equally qualified,” Stewart noted of the COO hired when Industrious had 10 locations and coworking was still considered a fad.

“He was a believer. We needed another believer on the team,” said Stewart, who along with Hodari, presides over a company with more than 50 locations in 33 cities across the country, COOs tend to have a defining role in the success of coworking operations as they scale.

“He’s someone who’s been doing it longer, who’s seen downturns,” Stewart emphasized.

“It’s a key hire,” agreed Wilmott. “They have the experience. They know how to get sales to work with operations. They know how to put measurables in place and make everyone accountable. They know what success looks like. You need someone to help pull those pieces together.”

5. Shifting gears when it doesn’t feel right.

The nature of a startup business means constant change and it often takes more than one approach to manage a dynamic organization as it shifts from one phase to another.

Ashley Buckner related her firm’s difficulties with whether to structure regional management geographically or task-based as Carr Workplaces added layers.

In the end, neither approach worked. “It was terrible. There was so much gray area,” she recalled. “We ended up grouping centers by similar size and area. So, all 20,000 square foot centers in suburban areas have the same regional manager.”

As a serious design aficionado, Bond Collective founder Shlomo Silber and team were excited to hire a well-known architect. But he quickly realized they were not on the same page.

“The architect wanted to design a museum when we wanted a boutique hotel,” Silber recalled. His solution was to bring on a freelancer and begin building his own interior design team. “We realized that no one gets and understands the space like we do.”

“Design is the most enjoyable part of this job,” said Silber, describing his “war room” with floor plans on walls, books for each space, and boxes of finish samples.

“Looking at cool spaces and building something we think is special is our secret sauce. We’re super passionate about design. We’re never going to give someone the reins because they’re not in our heads. We have a good idea of what our members want.”

6. Knowing when to listen.

Despite their eagerness to invest and expand, Justin Stewart related how he and his co-founder learned to listen to their COO about holding off spending before funds were available, ultimately fueling their growth trajectory.

“Our COO is the reason why we are where we are now,” added Stewart, whose firm is slated to reach about 115 locations in 2019.

He also shared another lesson learned about listening to trusted advisors.

When an employment contract came back from a key hire with extensive changes marked up, Industrious adjusted the terms to accommodate the candidate. “We had never done that before,” recalled Stewart, noting he ignored warnings from his co-founder, HR person, wife and mother who all told him such accommodations were not a good sign.

Indeed, the amended contract turned out to be a pain point in numerous interactions between the employee and management and she eventually left.

Lesson learned? “If something doesn’t smell right, it probably isn’t,” Stewart stated. And, listen to your mother.

This blog post was originally published on allwork, to read the original post click here.

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