Lisa Taylor, a former business executive who lives in Newport Beach, was experiencing the same problem that has frustrated so many other entrepreneurs who don’t have their own offices.
She would go to a coffee shop to work but couldn’t find a seat.
“The people who were sitting there taking up spaces were not there for the coffee but the Wi-Fi,” she recalled. “They couldn’t get up to use the bathroom because they were afraid they’d lose their seat.”
And it was a lousy place to work, she said: “It was a cold, loud, disruptive environment, and I thought, ‘I could build a better model.’ I just need to make it comfortable, like it’s their office, home and coffee shop all in one.”
That’s what Taylor did. She founded a new chain of co-working spaces in Costa Mesa that provide all the Wi-Fi, photocopiers, meeting rooms, desks and coffee a startup could want in a space that is colorful and collaborative.
The company, called CrashLabs, is not the first co-working space to come to Orange County, but it is the first home-grown one.
Tech Space, originally founded in New York, is one of a handful of co-working chains operating in Southern California. It runs “full-service,” “flexible office space” in Costa Mesa, Aliso Viejo, New York, Los Angeles and San Francisco.
BlankSpaces, started in 2008, is another chain operating in the Los Angeles area. New York-based We Work runs 30 locations globally, including one in Los Angeles.
Co-working has yet to become a household word, but it’s an idea born from the realities of the modern workplace. The Bureau of Labor Statistics estimates that by 2020, 40 percent of the U.S. work force, or 65 million Americans, will be freelancers, temporary workers, independent contractors and entrepreneurs.
Co-working spaces like CrashLabs cater to the untethered worker with a shared environment that lets individuals work independently but not alone.
A global phenomenon that began a decade ago, co-working is prominent in major urban areas like San Francisco, Boston and New York, where there are clusters of entrepreneurs in densely populated areas. Orange County has been slower to the game, analysts say, because much of it is so spread out.
At CrashLabs, memberspay an annual flat fee of $25 to join and then pay by the hour, day, week or month to use its amenities. In addition to a kitchen and lockers, there are tables wired with outlets to plug in laptops, private meeting rooms with soundproof sliding glass doors, and walls coated in a magnetic paint that doubles as dry erase board to jot down ideas or make presentations.
“The whole space is movable, flexible – just like people’s schedules and lifestyles,” Taylor said.
Combining a place to crash with a lab environment that encourages cooperation, CrashLabs earlier this month soft launched its first of two Costa Mesa locations in a 2,000-square foot-space on 17th Street.
It officially opens July 17 and will eventually expand to 6,000 square feet. It already counts its membership at roughly 100. A second, 6,400-square-foot location on Randolph Street will open in August and provide space for performances and dinners, as well as open co-working.
Similar to traditional businesses, CrashLabs operates from 8:30 a.m. to 6 p.m. Monday through Friday, but it also hosts after-hours networking and workshop events to help entrepreneurs of disparate disciplines bounce ideas off one another and learn about topics ranging from finances to search engine optimization.
“It’s not just a place or a space,” Taylor said. “You tap into a community. That’s when collaboration and synergy happens – and innovations.”
Taylor should know. In 1998, she founded the Irvine-based global semiconductor distribution business, NexGen Digital, and expanded it to a $16.5 million company in two years. It was after selling her stake in NexGen in October 2013 – and experiencing firsthand the difficulty of having no office space – that she decided to set up CrashLabs.
Co-working, as both a concept and a term, dates to 2005 when San Francisco computer scientist Brad Neuberg invited strangers to use the loft that was his home and workspace. Neuberg went on to co-found Citizen Space, which is credited as the first co-working environment.
San Francisco has since become a hotbed of co-working, through companies with catchy names like NextSpace and Sandbox Suites. So has New York, where We Work grew into a $5 billion company.
By some estimates, there are now more than 700 co-working spaces in the U.S. The number of co-working spaces has doubled each year since 2006, according to Innovation is Everywhere, an international coalition of co-working entrepreneurs.
Even so, “The demand far outstrips the supply,” said Jerome Chang, founder of the 7-year-old BlankSpaces, which has co-working locations in Santa Monica, downtown Los Angeles and the Mid-Wilshire district, and will open one later this year in Pasadena.
“The supply is barely, even remotely, trying to catch up,”Chang said. “The army of people who are potential clients, users, visitors of these spaces is growing just on an individual worker basis.”
Chang is also the founder of the League of Extraordinary Co-working Spaces, a group of 20 co-working space owners operating 45 locations globally who formed an industry association in 2012 to share best practices and establish co-working standards about membership policies and Wi-Fi systems, among other things.
“No matter how advanced we are as a civilization technology-wise, the success of one business always comes back to building strong, personal, long-term relationships,” said Melissa Geissinger, global collaboration partner with coworking.com, a website that is working to establish collaboration, openness, community, accessibility and sustainability as the core values of co-working.
“Co-working goes beyond the physical desk. It goes beyond the shared workspace,” Geissinger said. “These are real communities full of people who trust one another and rely on one another.”
That has been the case for Erin Leigh Brown, who was like a lot of new Orange County residents when she moved to Costa Mesa six months ago and was looking for a place to operate the independent marketing consultancy she launched in January after 14 years as a salaried marketing manager in New York.
“I was finding it very difficult to get things done working from my home,” said Brown, 38, who moved to the area with her husband and 1-year-old daughter. She experimented with working at coffee shops but was too distracted by people watching.
A member of CrashLabs since May, Brown said that what started as a distraction-free place to work has become a confidence-building tool. She meets fellow CrashLabs members who can help with her website design and other platforms she’s using to build her nascent business.
“CrashLabs is a different dynamic,” Brown said. “I get up in the morning. I get ready as if I’m going to the office, and I treat it as if I’m going to work.”
Liz Elam, the executive producer of GCUC, kicks off day two of the conference at the Freight & Salvage in Berkeley, Calif. Image courtesy of GCUC.
We convened in Berkeley, California with hundreds of of workplace experts, “people-people”, and coworking space providers last week for the Global Coworking Unconference Conference, better known as “juicy”. The international gathering is the brainchild of Liz Elam (whom you may remember from our recent webinar and this popular Expert Insight), and the three-day event—full of talk about design, technology, branding, and real estate—had something for workplace nerds of every persuasion.
Day one saw an introduction to the event and the history of coworking for first-timers, followed by two full days of presentations, “unconference” (where attendees chose and then voted on discussion topics for breakout sessions), socializing, and tours of nearly 30 coworking spaces across the Bay Area. On top of all that and in the spirit ofcoimmersion, we shacked up with Copass (a global network of coworking spaces that also organizes week-long Copass Camps—coliving and coworking adventures in far-flung places) atThe Red Vic, a coliving experiment in the Haight. But more on that later.
Below, we’ve whittled our notes down to five takeaways that have stuck with us and have us thinking about coworking as movement, strategy, and lodestar for what the future of work has in store.
Tony Bacigalupo, founder of New Work City, hypes the morning crowd of GCUC first-timers on day one of the conference. Image courtesy of GCUC.
1. Shifts in real estate combined with shifts in the way we work have created a perfect coworking storm
“The category of coworking is exploding and it’s an underserved market. There’s a tremendous number of people looking for a home,” said Rosemarie Ryan, the co-founder and CEO of co:collective, a strategic branding firm.
How underserved and how tremendous, you ask? Right now, there are 44.7 million independent workers in the U.S., and only about 88,250 coworking seats. That means there are 506 potential coworkers per seat.
“There’s been a fundamental shift in real estate, and a fundamental shift in the way we work,” she added. “These are two very different constituencies, [and] if you can figure out how to meet them in the middle” then, well, you’ve got coworking gold.
2. No one has mastered the phone booth
“Are they rentable? Paid for by the hour? What’s the policy? The reality is that people camp out—it’s comfortable, but it’s not fair,” said Jerome Chang, an architect and the founder of BLANKSPACES, a coworking community in Los Angeles. “Unfortunately, I’ve yet to see really well-executed phone booths.”
We nodded in agreement. In our own brief coworking experience, the phone booths gave the impression of privacy—a heavy wool curtain—but acoustically, you could hear every word. And, despite the 30 minute time limit, people still camped out. What’s the solution? “People want to pace,” said Chang. “Maybe it’s to have a 7×7 meeting room, [one] that’s actually soundproof.”
A gaggle of conference attendees rush to add their desired topics for the unconference sessions to the pool. Image courtesy of GCUC.
3. There’s room for both a Four Seasons and a Ritz
Plus a few Marriotts, a Holiday Inn, and any number of boutique hotels. And that’s just in one zip code. See where we’re going with this? The coworking market is saturating fast, but, “in terms of differentiation,” said Ryan, the branding expert, “coworking spaces should think of themselves like hotels. Just because there’s a Four Seasons doesn’t mean there can’t be a Ritz.”
In the end, a coworking space is going to flourish because of the authenticity of its brand and the community that builds up around it. Which brings us to…
4. People aren’t just showing up at your coworking space because you have better printers
“Our work lives and personal lives are blending,” said Jacob Sayles, the founder of Office Nomads, a coworking space in Seattle. “Coworking supports this way of life.” During his presentation, he shared the results of a recent survey of nearly 700 coworkers across North America, conducted by GCUC and Emergent Research.
Jacob Sayles, founder of Office Nomads, a coworking space in Seattle, shares the results of the 2015 GCUC/Emergent Research Coworking Survey. Image courtesy of GCUC.
Of the respondents, 84 percent said that they were more engaged and motivated when coworking; 67 percent said coworking improved their professional success; and 89 percent reported that they are happier working in a coworking space than at home or in a more traditional work setting.
“These are the reasons people will come to your coworking space,” said Sayles. “It’s not just because you have better printers.”
5. There’s so much more to coworking than cutting up office space and leasing it to businesses at a profitable margin
The GCUC crowd was comprised of a gritty, go-getty, dedicated bunch of fiends, striving to stay true to the coworking “core values”—collaboration, openness, community, accessibility, and sustainability—set forth in 2007, two years after the word coworking was coined by Brad Neuberg. In his opening remarks, Tony Bacigalupo, the founder of New Work City, a—you guessed it—New York City-based coworking community, drew a distinction between the larger, very buzzworthy office space providers—Regus, WeWork: the “Starbucks” brand of coworking—and the smaller, more specialized and community-oriented spaces: your local boutique coffee roasters.
“Is coworking a new way to cut up office space and lease it to businesses at a profitable margin, or is it about something more important?” he said, and answering his own question, to hearty applause: “We’re building a movement to change the way we work forever.”
To kick off last week’s Global Coworking Unconference Conference in Berkeley, Ca., Tony Bacigalupo, co-founder of New Work City, posed a question: Who thinks coworking means dividing up office space to sell at a profit? Not a hand went up. He then asked those who think coworking is something more than that to raise their hand. Nearly every hand in the room shot up, accompanied by cheers, shouts, and hollers of approval. And with that, we launched into three days of community building, information sharing, and planning around coworking.
The recurring themes of this year’s GCUC (pronounced “juicy”), hosted by NextSpace Berkeley, were community, colearning, creating alliances, and a notion that is at the heart of GCUC: that those within the coworking community are collaborators, not competitors.
In just 10 years, coworking has grown from a temporary space in San Francisco, complete with card tables and a few chairs, to over 3,000 spaces around the world. A GCUC participant from Japan told an unconference session that there are now over 300 coworking spaces in Tokyo alone.
Brad Neuberg, who opened that first coworking space in San Francisco in 2005, and coined the word coworking, told the GCUC audience that when he told people about coworking originally, he had people laugh at him.
“Go ahead, be weird,” he advised. “Sometimes what’s weird goes mainstream and becomes the new normal.”
Brad Neuberg, who created the first coworking space, encouraged the GCUC audience to steal his idea and build on it. Photo: Cat Johnson
As coworking booms worldwide, coworking space operators build on the concept and create spaces to suit their community. Neuberg encourages this evolution. Throughout his presentation he returned to a mantra that drives open culture, including coworking: Steal this idea, remix it, make it your own.
Liz Elam, executive producer of GCUC, explains that the growth of coworking means there’s more opportunity for everyone. When asked what she would like to see from the coworking movement, she says she’d like to see more people “jump in the pool and do it” because there’s so much room for growth. Her goal for GCUC is to inspire people.
“I want to give them that push into the pool that says, ‘I can do this,’” she told me. “I want to give them the tools and let them know it’s OK and that other people are doing it.” She adds, “People took the time to help me—I’m just taking the time to help people out on a bigger scale.”
A hot topic at GCUC was the rise of corporate “coworking.” In 2011, much to the laughter and dismay of those in the coworking movement, office rental giant Regus announced that it “pioneered the concept of coworking two decades ago.” Business complexes that have been divided into cubicles or offices are also jumping on the “coworking” bandwagon. Those gathered at GCUC questioned whether WeWork, which The Atlantic recently described as “the biggest player in the coworking universe,” can really be considered coworking. Regardless of whether you consider a company valued at $5 billion to be aligned with the collaborative ethos at the heart of coworking, the fact is, these corporate spaces are here.
Bacigalupo sees the rise of corporate “coworking” as a sign of coworking’s arrival.
“It’s part of the natural evolution of things,” he told me. “One thing starts out punk rock and eventually gets corporate. I think that what we do with that is up to us. If there are enough people that believe in rock and roll, then rock and roll will live.”
GCUC executive producer Liz Elam (far left) leads a panel discussion about real estate and coworking. Photo: Cat Johnson
Coworking’s maturation had GCUC participants asking what the definition of coworking is, and what the difference between a mobile worker and a coworker is. Responses ranged from those who feel that community is at the core of coworking to those who feel that any space that serves mobile or independent workers is a coworking space.
The driving spirit of GCUC leans heavily toward community, but that’s not to say that business is left by the wayside. There were sessions on real estate best practices (get a broker and negotiate with landlords), tech tools (people are hacking together apps, spreadsheets, and platforms seeking integrated solutions), and how to design a space to attract members and get the highest return on investment (“Simplify what you have, and prioritize what you need,” advised Jerome Chang, of Blankspaces).
Now in its fourth year, GCUC has grown into an international event to empower coworking professionals. The unconference sessions, where participants choose the topics, included discussions about event marketing, the operating costs of opening a space, what to do before you sign a lease on a space, how to stay productive in your space, tech dos and don’ts, tips for community managers, funding a coworking startup, securing sponsorships, what amenities to offer, the best customer relationship management (CRM) software to use, how to cultivate diversity in your space, and more. There was also talk about coworking spaces partnering with municipalities, small business organizations, and economic development departments.
Unconference participants, including Tony Bacigalupo (left) choosing topics they’d like to discuss. Photo: Cat Johnson
GCUC provided a glimpse into the future of coworking as participants discussed what they’re working on and what they’d like to see. Here are some of the things we can look forward to in the not-so-distant future of coworking.
Coworking Alliances: Coworking space operators are looking to create alliances on the local, regional, country-wide, and international levels. These alliances benefit space operators who can share best practices and information, coworking space members who can stay connected to a trusted network when traveling, and coworking newcomers looking for the right space for them. Examples of these alliances include Coworking Toronto, Coshare, the League of Extraordinary Coworking Spaces (LExC), and theMountain Coworking Alliance.
Partnering with Educational Institutions: There’s a bright future in coworking spaces partnering with educational institutions. There are already spaces partnering with universities to create incubators and provide workspace, but look for spaces to partner with schools of all levels to cultivate talent, ideas, and community.
Colearning: One of the buzzwords at GCUC was “colearning.” The idea is to utilize the wealth of information within coworking spaces to benefit other members through facilitated colearning environments. This includes workshops and presentations, but also extends to online coursework, peer-to-peer exchanges, and more.
The Growth of Coworking in Small Cities, Suburbs, and Rural Settings: No longer contained to cities, coworking spaces are popping up in cities and towns of all sizes. These spaces have unique challenges and are well-served to learn from each other. From tiny towns in Texas, to isolated mountain towns and even islands, coworking is becoming a part of communities of all makeups and sizes.
Local and Global Networks for Mobile Coworkers: Coworkers want to be able to travel to trusted spaces and, ideally, work for free. Seeing this need, there’s a lot of conversation about the best ways to create global networks of coworking spaces that members can connect with. Already, there’s the Coworking Visa, LExC, and Copass. Expect to see more focus put on connecting members to spaces around the world.
More Specialization: Want doggy daycare for your pooch while you work? There will be a coworking space for that. There are already coworking spaces for artists and creatives, writers, rock climbers, musicians and more. Expect to see more specialization as spaces experiment with filling needs of communities.
Now somewhere between its infancy and global ubiquitousness, coworking is being shaped by coworking space owners and members from around the world, many of them in attendance at GCUC. There were dozens of countries represented at the conference, and there are several international GCUCs, including GCUC Australianext month in Sydney, GCUC Canada in Toronto in September, and the just-announced GCUC South America in Brazil this fall.
“This is a movement that we’re building to change the way people work forever,” Bacigalupo told the audience. “One hundred years from now, when they talk about the history of coworking, they’ll be talking about what we in this room are doing. If you’re here, you’re a part of it.”
Our founder Jerome Chang quoted in this recent piece published by Officing Today: http://www.officingtoday.com/2015/04/can-a-piece-of-technology-replace-a-coworking-community-manager/
In coworking circles, a bubbling atmosphere with a vibrant community of supportive members is its most prized possession.
But building this beating heart isn’t easy. It takes long hours and painstaking dedication, building personal connections, managing workspace dynamics, and organising frequent events and socials as sideline encouragement.
This takes valuable time, effort and money, which usually comes in the form of a community manager. But for smaller cash-strapped coworking spaces struggling to get going, is there an alternative way to foster coworking’s cherished community?
As with most things nowadays, there’s an app for that.
Many workspace management platforms come with built-in social tools to encourage member engagement, in addition to essentials like invoicing, attendance and meeting room bookings. Some apps, however, focus predominantly on the social community aspect rather than the business and booking end of a workspace.
Rotterdam-based mrWatson is one such example. A quick glance at the website will tell you that while the tool takes care of bookings and analytics, its chief approach is all about building coworking communities.
Straight out of university, young entrepreneurs Bart van der Zande and Fabian van den Berg co-founded mrWatson whilst working in another company’s spare office in Rotterdam.
“We felt the urge to surround ourselves with other entrepreneurs and share knowledge, experiences, ideas and network,” Bart told Officing Today. “So we started looking for such a space. It was around that time we came up with the idea of mrWatson.”
During their lonely search for “a sort of entrepreneurial community”, Bart and Fabian found that most coworking space users they met didn’t know who they shared the building with.
“Working on different floors made people total strangers. Even community managers from successful spaces had to admit that it was difficult to organise communications and help people get to know each other.
“That was quite disappointing because we really saw the great possibilities a strong community could have.”
Some spaces use the system as a standalone tool, but Bart believes that it works best alongside a human presence.
“I think it should be one of the main tools of the community manager,” he said. “It makes their lives easier. A lot of communication can go directly from one person to another or through the whole community, instead of going via the manager, saving precious time.”
“Humans who speak to other humans”
Coworking is growing fast, which is bringing innovative ideas out of the woodwork. Established spaces such as BLANKSPACES have seen many novel ideas come and go, and while founder Jerome Chang is open to consideration, he is skeptical over the social element of management systems.
“I prefer organic, in-person connections. We have humans at the front desk who speak to other humans,” he said. While Jerome has been “researching options” for BLANKSPACES, he remains unconvinced of the value of a social tool that in-house employees already achieve.
“People are pretty busy. It’s not the headache of managing a system that deters us, it’s the receptiveness from members. The effort to get buy-in will be so huge, the reward is unlikely to be worth it. Then the on boarding and exiting of members who come and go…”
Victoria Arnold, founder of DeskUnion and manager of The Square in Edinburgh, uses Nexudus as their coworking management platform. It includes social elements such as a community board and members list.
“Being honest, we’ve not had much online engagement from members despite encouragement,” she said. “Most members look at it as just an extra thing they need to remember to do. They’re already time poor.
“We’ve toyed with a Facebook group as that’s where members naturally socialise online, but I’m reluctant to duplicate efforts. For us, it’s the physical community activities that are most effective. Regular networking events, chats over the coffee machine, post-it note walls. It’s the simple visual stuff that our members seem to enjoy most!”
While a social tool can help to alleviate time-strapped operators, it seems some coworking members may be less inclined to add another task to their to-do list.
As Jerome also commented, the best coworking communities rely on “give and take, not just take” – and there is concern that some members may use social tools to solicit information for sales opportunities.
And yet, mrWatson shows that the idea works – and it’s catching on.
Tije Vos, a community manager at Workspot, which operates numerous coworking spaces in The Netherlands, uses mrWatson.
“I like the fact that I can manage multiple communities and organise the communication in a way that is much more interactive and less annoying than email,” said Tiie. “It’s really easy for users to discover the facilities that we offer and the people that are in the building.
“Even when I had just one community, it helped me empower our members to set up events themselves, creating a ‘Do It Yourself’ mentality, which makes it way more powerful.”
According to Bart, Demand for mrWatson is rising, “just like the market of coworking”. And while he accepts that larger spaces like WeWork can afford to build their own tools, systems like mrWatson can help smaller spaces manage a space without high or ongoing development costs.
“We are focusing on developing into a platform that can easily connect with other services, making us the ‘people part’ and the portal to all kinds of services that are relevant for coworking spaces,” he added. “In that way we want to be able to fulfil every growing requirement for a platform like this.”
So the question remains. Can a piece of technology create a coworking community – and can it ever replace a human being? Despite the early successes of some coworking community systems, it seems – for now at least – these developments work best in the hands of a real coworking space ambassador. As Victoria Arnold puts it:
“Never underestimate the value of an effective Community Manger. They’re the best possible community building tool you have!”
DOWNTOWN LOS ANGELES — When it comes to high technology in Los Angeles, the location of choice is “Silicon Beach.” The label describes the thriving scene in Santa Monica, Venice and adjacent neighborhoods that is home to the local offices of Google, Snapchat, Hulu and many smaller companies.
At the same time, and with far less flash, Downtown Los Angeles is emerging as a destination for some tech companies. While the Central City is not yet a rival to the Westside, certain startups are finding a ripe atmosphere in a supportive, creative community. In other instances, established firms like the ability to grow with the neighborhood.
There are numerous reasons for this, say tech industry and real estate players. The Central City has cheaper office space than on the Westside, and the offerings are growing as developers build more “creative” office space, with open floor plans rather than traditional corner offices and cubicles (see sidebar below). Others point out that Downtown’s growing roster of restaurants, bars and entertainment spots makes it more urban and flat-out hipper than the more venerable hubs, which is important for an industry with a hefty concentration of young workers.
Downtown’s greatest tech strength is in e-commerce, thanks to the proximity of the Fashion District and its network of manufacturing and distribution centers. Online fashion retailer Nasty Gal last year expanded into a larger space in its home of the PacMutual Building near Pershing Square. Other web-centric retailers to set up in Downtown include Hautelook, StyleSaint, GoJane, Ella Moss and Splendid.
Additionally, more than 35 tech startups call Downtown home, according to startup mapping site Represent L.A., with brands ranging from the customer service app maker Showkit to online truck parts shop Findit Parts to teleconferencing company Oblong Industries.
S. Ryan Meyer, regional director of tech education company General Assembly, has closely watched the area’s growing tech environment.The company, which has locations in 14 cities around the world, is expanding from Santa Monica into new digs at shared-office space Maker City, near Broadway and Washington Boulevard (in the complex formerly known as the L.A. Mart). They are also nearing a deal for a permanent office in the Arts District.
“There’s a lot of innovation Downtown in the tech sector, and as an educational startup, being closer and more accessible to a majority of people in the city was important,” Meyer said.
One man with a bird’s-eye view of the local tech scene is Peter Marx, a longtime Qualcomm executive who Mayor Eric Garcetti hired to be the city’s first Chief Innovation Technology Officer. His duties include improving tech infrastructure across Los Angeles and tracking tech sector growth.
“Downtown is a completely different place than when I was growing up,” he said. “You have public transit, you have bike lanes, you have nightlife. It has all the characteristics of what a hip, contemporary digital crowd would want.”
Marx is not alone in pointing to the cultural shift in the community.
Jeff Ellermeyer founded the production company Buck, which specializes in motion graphics, usually in ads, in 2003. Three years later he moved the growing company from Koreatown to office space on the fourth floor of a building at 515 W. Seventh St., above where Mas Malo and the whiskey bar Seven Grand sit today. Ellermeyer has 30 employees in his Downtown office and calls coming to the community the “best decision I’ve made.”
“Production likes to be cool, and one thing I’m noticing now is — this is important for advertising — when clients come and participate in production, they used to want to be at the beach,” Ellermeyer said. “But a lot of clients want to stay Downtown now instead. There’s a tipping point for attracting creatives.”
Anthony Kelani, the co-founder and CEO of startup app company Showkit, saw a similar hip factor before deciding to move to the Spring Arts Tower after “graduating” from a West Hollywood incubator. He has five employees and plans to expand the office soon.
“Everybody kind of congregates on the Westside and a lot of mixers and networking events take place there,” he said. “But you’re starting to see those things in Downtown, too. I think the whole startup ecosystem is growing up right now.”
The hip factor is complemented by cost concerns. Scott Steuber, a broker with Avison Young, who has experience in both West L.A. and Downtown, said that a number of companies are getting priced out of Silicon Beach and are winding up in “peripheral” markets such as Downtown.
Rents could be $7-$8 per square foot per month in certain neighborhoods in Venice, he said. It can cost $5-$6 in Santa Monica and $3-$4 in Playa Vista. Meanwhile, rents in Downtown are closer to $2.50-$3 per square foot, he said.
Steuber doesn’t yet see a full-on migration of tech companies into the Central City, but he noted there are more office options for innovative brands than ever before.
Other companies are choosing to expand in Downtown. NationBuilder, a digital organizing platform company founded in 2009 by longtime Central City resident Jim Gilliam, is moving from the Pershing Square Building into bigger headquarters in the Biltmore Hotel. Gilliam saidhe resisted pressure to relocate his company, which now has about 150 employees, to West L.A.
Part of the reason for staying, he said, was to avoid being in a “bubble.” The Downtown location, he added, allows NationBuilder to integrate with the neighborhood in a meaningful way.
“D.C., Silicon Valley, the Westside — they all have their own dominant culture that’s toxic in its own way,” Gilliam said. “I wanted to be in a community where people were trying to build new from something old. Downtown really represented that to me.”
Ani Okkasian, director of member experience at Hub L.A., an Arts District incubator that specializes in companies with social entrepreneurship elements and has more than 30 locations around the world, echoed the point.
“A couple years ago, the Arts District wasn’t as desirable. Now, people are coming in and newer businesses are re-establishing neighborhoods,” she said. “It felt like a neighborhood where we could ask, ‘Can we change it through good business?’”
Hunting a Juggernaut
No one pretends that Downtown is a direct competitor to Silicon Beach. Instead, say experts, its rivals for attracting businesses are smaller communities such as Culver City.
One issue, Steuber said, is that much of the top engineering and programming talent is concentrated in West L.A., and executives from national companies continue to be attracted to living on the coastline. Moving Downtown into the tech big-time, he said, may require persuading a juggernaut company to set up in Downtown.
That’s easier said than done, of course. Most recently, Yahoo, which real estate players say toured Downtown, rejected the area in favor of Plaza Vista, which is also where Google just bought 12 acres of land.
In Rising’s long view, Downtown has more breathing room for companies and their talent. Santa Monica and Venice are low on space and are getting more expensive to live in, he said, and potential office and residential projects have been “shut down” by the community.
“When these kids get older and start building families, they’ll run into a huge housing imbalance,” he said.
Meanwhile, Rising said, younger people are attracted to Downtown’s “24-hour experience,” which he compared to the scenes in San Francisco and New York’s SoHo area.
Marx has high hopes that the burgeoning Downtown tech trend will continue to grow. The Central City’s emergence, he said, reminds him of an aged San Francisco warehouse, next to a vein of railroad tracks, that software giantAdobe converted into its huge headquarters.
“It was when Giants Stadium was being built, the Embarcadero was growing, and they’re still there and thriving,” Marx remarked. “We’ll have our own examples, in a very L.A. way, where Downtown and its beautiful buildings and communities stay hip and rejuvenated as a center for technology.”
Many Downtown law, banking and insurance firms have traditional office layouts, with executives in window suites and assistants relegated to interior cubicles. Amid the emerging tech boom, however, Downtown landlords are trying to lure innovative tenants by offering collaborative floor plans and modern tech infrastructure.
It seems to be working.
The New York-based We Work, which offers shared office space for entrepreneurs in creative and tech industries, recently announced it is leasing six floors (44,500 square feet) of the Fine Arts Building at 811 W. Seventh St. There’s a similar arrangement at Maker City L.A., near Broadway and Washington Boulevard, and newcomer Blankspaces in the Historic Core.
The L.A. Cleantech Incubator also offers office space and support services to startups, as does its neighbor Hub L.A., which specializes in companies with social entrepreneurship elements.
If office space is being built in Downtown, it probably comes with the “creative” tag. The former Ford and Coca Cola factories in the Arts District are undergoing such a transformation. The Herald Examiner Building in South Park will also have creative office space as part of its renovation.
Rising Realty Partners’ Christopher Rising, who oversaw a renovation of the PacMutual Building into creative office space, notes that the shift in workspace design is affecting not just the tech and startup sectors, but “traditional” occupations like law and finance, too.
“What’s interesting is that the term ‘creative’ isn’t going to mean a lot in the future,” Rising said. “A 32-year-old lawyer trying to start their own business is going to want open offices, too. I don’t see us going back to the time of 10-by-10 offices with all your files in cabinets. We don’t have horse-and-buggies anymore, either.”
Five Intriguing Downtown Tech Players
Location: 515 W. Seventh St.
Who Are They?: Even if you’ve never heard of motion graphics production company Buck, you’ve probably seen their work on TV. From McDonald’s “Heart Winter” campaign for their white chocolate drinks to Honda’s “Santa’s New Sleigh” ad, Buck does it all. The company, which moved Downtown in 2006, is one of the area’s oldest tech players.
Who Are They?: Count Mayor Eric Garcetti among NationBuilder’s clients; he has used the digital organizing company for a bevy of services both before and after he was elected. The company is known for its software tool that streamlines different tasks — say, finances, employee and volunteer management and growth goals — into a single platform.
Location: 1933 S. Broadway
Employees: Approx. 12
Who Are They?: Education is being transformed in the age of digital media, and General Assembly is Exhibit A in Downtown. The company offers both online and campus classes with a focus on leveraging technology, with programs in data science, digital marketing, web development and more. General Assembly is expanding from Santa Monica to Downtown.
Who Are They?: This Arts District facility (it’s next to Urth Caffé) is an incubator that nurtures a variety of tech startups. From a cutting-edge production lighting business (Hive) to tricked-out electric motorcycles (Juiced) to experimental lithium ion batteries (CalBattery), LACI teaches the next generation what to do and not do. The incubator, run by Fred Walti, is expanding as the La Kretz Innovation Campus, which will house R&D, conference and workplace training spaces.
Location: 523 W. Sixth St.
Employees: Approx. 14
Who Are They?: Hollywood has come Downtown, thanks to visual effects artists Alex Henning and Ben Grossmann, who partnered with Rodrigo Teixeira to create Magnopus. Henning and Grossmann won an Oscar for their work on Martin Scorsese’s Hugo. Past titles from the duo include Sin City, The Amazing Spider-Man and the Leonardo DiCaprio-led Shutter Island.
Working remotely doesn’t have to mean being cooped up in your house or apartment. Now there are spaces where remote workers and tech startups can get office space or just share a communal work area with others just like them.Coworking spaces like WeWork have even made the news recently scoring big cash investments.
Robert Conrad, partner in another such venture, Co-Merge Workspace, explainsto UT San Diego why coworking is the future:
“One, technology enables it. With all that technology offers, beyond face-to-face interaction there’s no reason to have an office. It’s much more effective to have people work wherever is most productive for them. Two, there’s a lot of value in this to big companies. It can reduce the real estate costs, and they’re more likely to retain talent if they allow employees to be more flexible about where they work.”
Here’s a list of 20 hot coworking spaces currently making news, perhaps one in a city near you;
This New York based startup rents office space to entrepreneurs around the world. WeWork’s business model essentially pairs office space with the technology that it takes to run a business. After a recent round of funding, the company is now valued at $5 billion, making it one of the biggest players in the coworking industry.
With nine locations throughout the country, primarily in California, NextSpace is one of the fastest growing coworking organizations around. Membership varies at each location, but most offer options ranging from day passes with mailbox access to full-time offices.
This coworking space in the heart of Boston offers a professional office setting with a vibrant community of entrepreneurs. Monthly plans range from $99 for conference space and a few other amenities to more than $1,450 for private office space.
Enerspace offers coworking memberships in Chicago and Palo Alto, California. Members can choose between full-time and part-time, coworking and private offices, as well as other offerings. They also have access to special member events like demo days, classes and networking lunches.
This Sacramento-based coworking space features membership for entrepreneurs and makers. Mentorship programs, networking and industry events are aimed at students, professionals and hobbyists, mainly in design and creative fields.
Posh Coworking is a coworking community created specifically for women entrepreneurs. Located in Austin, Texas, membership at Posh comes in various levels, which come with different annual prices and benefits. The space also offers various networking events for women throughout the year.
The Hive @ 44
The Hive @ 44 is a coworking center in St. Louis, Missouri that focuses on community building. Member amenities include meeting rooms, mail service, a photo and video studio, legal services and more. Cost ranges from $15 for a one-day pass to $575 and up for a private suite.
Entrepreneurs and freelancers in Hawaii also have access to coworking space withBoxJelly. Members can book a dedicated workspace, attend or host meetings and events, or even just use it as a place to receive business mail. Mail membership starts at $50 per month and dedicated desk spaces can range up to $349 per month.
Blankspaces offers three coworking locations in Southern California where entrepreneurs, freelancers and other creatives can gather or work privately. Full-time membership starts at $350 per month. But there are also part-time options for those who want to just drop by once in awhile.
This Washington D.C. based startup incubator aims to connect startups with the resources they need to succeed, from mentorships to capital. Mainly focused on sectors like education, energy, health and cities, 1776 accepts startup applicants and hosts events at its campus just a few blocks away from the White House.
Collective Agency in Portland, Oregon offers a cozy environment for anyone in the area who would rather work alongside others than at home by themselves. Membership ranges from $250 per month to $375 per month and includes amenities such as Wi-Fi, coffee, conference rooms, bike parking and more.
Tahoe Mountain Lab
Located in the mountains of South Lake Tahoe, California, this coworking space offers both shared and private office space outfitted with the necessary technology for entrepreneurs and freelancers. The space has a variety of different plans to fit different needs, from a one-day pass for $25 to full-time, private offices for over $500 per month.
Design Spaces is a community focused coworking space in the heart of Silicon Valley. It aims to provide an office environment to foster collaboration and cooperation between entrepreneurs and other remote workers. Coworking membership starts at $250 per month and includes shared workspaces, conference rooms and other amenities.
This co-working space also offers support and consulting services for entrepreneurs in the media and tech industries. With locations in both New York City and Paris, Spark Labs also has partnerships with other incubators and accelerators around the world to enable its members in different markets.
Venture X is a coworking space in Naples, Florida. Members can rent office space starting at $249 per month or rent meeting rooms or virtual office services.
Located in Tempe, Arizona, this incubator focuses specifically on the gaming industry. Its aim is to educate people about games and gamers about business, while also acting as an advocate for the gaming community.
With multiple locations in Denver, Colorado, Thrive offers everything from part-time lounge space to meeting rooms and offices. Part-time membership starts at $199 per month. Thrive also hosts various events for entrepreneurs in the Denver community.
Venturef0rth offers 10,000 square feet of coworking space in Philadelphia. The space is a mix of private offices and common areas for entrepreneurs to meet and collaborate. And this coworking space doesn’t keep regular office hours, so its amenities are available to members 24/7.
This coworking space offers a place for entrepreneurs to work and collaborate along with other acceleration services like virtual reception and member events.Thinkspace has two coworking spaces located in Seattle and Redmond, Washington, with more than 300 companies in its community.
This coworking space in Raleigh, North Carolina offers a variety of different options for local entrepreneurs. Coworking membership starts at $125 per month and includes workspace, meeting space, and various other office benefits. And community membership starts at $300 per year and includes access to the group’s network of entrepreneurs and various other benefits.
Coworking space BLANKSPACES said today that it has opened up its third location in Southern California, and has opened up a new office location in downtown Los Angeles. The company–which was one of the first coworking spaces in Southern California–said it has opened up a new location between 5th and 6th street, near Pershing Square. The coworking operator said that the new location has eight team offices, ten individual offices, and three meeting rooms. BLANKSPACES also has locations in Santa Monica and Mid-Wilshire.
“…BLANKSPACES is the perfect location for Millennials who want to be surrounded by like-minded individuals…Coworking offers a solution to the problem of isolation that many freelancers experience, while at the same time letting them escape the distractions of a home office.”
Here at BLANKSPACES, we’re fortunate enough to have one of the most unique mix of entrepreneurs and professionals coworking under one roof.
Meet one of our newest members, Hugh Taylor. Hugh has written marketing content for clients like Microsoft, IBM, SAP, First Data, and Google. You can pick up a copy of his latest book, “B2B Technology Marketing” here!
“Marketing technology products to business customers is a distinct discipline. It doesn’t resemble consumer-facing tech marketing at all. It’s not even the same as business-to-business (B2B) marketing in general. B2B technology marketing requires a completely different way of thinking about customers, products, and markets, mostly because these factors are in a permanent state of flux. This book takes a pragmatic, strategically informed view of B2B technology marketing, exploring the essential responsibilities of the B2B technology marketing executive, including: • Lead generation • Filling the sales pipeline • Strategic messaging • Supporting the sales team • Communications and public relations • Creating customer preference • Product marketing”
“Hugh has served as Social Software Evangelist at IBM, Public Relations Manager for SharePoint at Microsoft, and VP of Marketing at several early stage technology ventures. He is the author of three books and hundreds of articles, case studies, and white papers about the interplay between business and technology. Prior to tech, Hugh worked in television. He earned his AB and MBA from Harvard. He lives in Los Angeles with his wife and three children.”