Indy Hall – By the Numbers
Filed under: FAQs, From the Business Side, Independents Hall, coworkers, coworking
Today, a longtime friend and observer of Indy Hall Imran Ali had a research piece published on GigaOm Pro about coworking spaces “by the numbers”. He featured Indy Hall as well as Fly the Coop, a Co-op coworking initiative in Manchester, UK.
This new article is behind a paywall, sadly. At the risk of being asked to take them down, I am going to quote a few select pieces of the article that Imran wrote that I thought were particularly salient. If you’re so inclined, a free 7 day trial of GigaOm Pro (credit card required). I don’t get any sort of kickbacks on subscriptions.
The foresight shown by the coworking movement’s founders — codified in values of collaboration, openness, community, accessibility — readily transposes onto crucial financial constructs, such as transparency, pricing and membership. You really have to live those values to make coworking viable in a fiscal sense.
Imran does a great job of identifying how we parlayed our community growth into business growth.
Both IndyHall and Fly The Coop were only able to build sustainable businesses because of the trust (and loans) that came from early-stage community building[...] It’s this very trust that separates coworking from the more prosaic serviced office.
And, perhaps most importantly, he puts the business viability into perspective for people who are simply in this for the money:
Just as individuals buy into a lifestyle, coworkers are buying into a workstyle; the financial stories of both IndyHall and Fly The Coop show that, though margins are tight, deep community bonds make all the difference, both financially and socially. It’s perhaps not a business for an investor looking to make a significant ROI, but eminently suitable for those who wish to participate as members who also modestly invest.
As promised, here are the RAW numbers that I gave to Imran to tell our story. We operate transparently, so any additional information we can provide about any piece of this data will only be based on the availability of more data points. It’s taken us a while to get good at measuring our growth, so there’s lots of data missing that we’d need to spend more time mining for.
Let me use some numbers to tell a story, from our founding fund-raising to our most recent move and financial stabilization
$0 – Pre-dedicated location costs for 9 months casual coworking/jelly, social gatherings, and other community-building exercises were done on a budget of time, not capital.
$4625 – our projected monthly revenue based on membership projections within 6 months.
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23 – our actual number of members on August 6, 2007 (lease signing day)
2 – our actual number of full time members on September 1st, 2007
4 - our actual number of lite members on September 1st, 2007
17 – our actual number of basic members on September 1st, 2007
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$1675 – monthly membership-only revenue committed on lease signing day.
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$2325 – additional member-driven startup capital, from members pre-paying for 2-6 months of their membership
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~$10,000 – money provided by founder for lease security deposit, furniture, supplies, and monthly rent cushion.
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$14,000 – total money raised from within membership/founders to sign a lease, furnish the space, and cushion rent until breakeven.
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1800 number of sq ft leased in Old City Philadelphia
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$2,450 – monthly budget for rent, utilities, and discretionary funds
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3 – Months to breakeven/cashflow positive
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39 – our actual number of members on June 1st, 2008 (10 months in)
9 – our actual number of full time members on June 1st, 2008
5 – our actual number of lite members on June 1st, 2008
25 – our actual number of basic members on June 1st, 2008
$3975 – Monthly Revenue from Memberships Only
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16 – months until partner loan payback ($10,000) completed
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53 – our actual number of members on March 2009
14 – our actual number of full time members on March 2009
7 – our actual number of lite members on March 2009
32 – our actual number of basic members on March 2009
$5875 – Monthly Revenue from Memberships Only
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$3,633.45 – actual monthly operating cost in March 2009
$2.02 – approximate monthly operating cost per square foot in March 2009
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4400 number of sq ft rented in Old City Philadelphia for May 1st, 2009
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67 – our actual number of members on May 1st, 2009
21 – our actual number of full time members on May 1st, 2009
7 – our actual number of lite members on May 1st, 2009
39 – our actual number of basic members on May 1st, 2009
$7975 – Monthly Revenue from Memberships Only
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$8,700.53 – estimated monthly operating cost for May 2009
$1.98 – approximate monthly operating cost per square foot in March 2009
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$30,000 – loan taken from one full-time member
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~$14,000 – savings in May 2009
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$21,460 – budget for furniture, buildout materials.
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6 – Months to breakeven/cashflow positive
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83 – our actual number of members on October 2009 (breakeven)
26 – our actual number of full time members on October 2009
6 – our actual number of lite members on October 2009
51 – our actual number of basic members on October 2009
$9475 – Monthly Revenue from Memberships Only
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9 – Months to begin payback of member loan (<24 month payback target)
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The financials, as it were, are relatively uninteresting. You can see that we operate on relatively thin margins. It’s also worth pointing out that in 3 years, neither Geoff nor I have taken a draw from profit. Every penny made by Indy Hall is re-inves
ted in our members, our space, our events, etc.
The interesting numbers will take some more time to pull together…but they are the numbers that we believe are important. Things like
- Cities, states, and countries of origin of Indy Hall guests.
- Drop-in rates
- Drop-in conversions to memberships
- Events hosted and organized by Indy Hall and Indy Hall Members
- New teams/partnerships formed
- New businesses established
- New products (commercial and non-commercial) developed by Indy Hall Members
- Average revenue generated by an independent worker
And more. What numbers would YOU like to see?
From the Video Archives: Coworking Questions answered for Web Worker Daily in 2009
Filed under: FAQs, From the Business Side, Independents Hall, IndyHall 201, IndyHall U, Videos, coworking
Wow…a WHOLE YEAR AGO, I answered a bunch of questions for Web Worker Daily in video format. I completely forgot about them until Gerard Sychay from Cincy Coworks tweeted about them. They answer questions that we answer a lot, so I thought it’d be valuable to post here.
IndyHall History:
Bootstrapping:
Diversity
The Future of IndyHall (from last year)
Coworking Tips
IndyHall 201: How IndyHall Communicates with it’s Community
Filed under: FAQs, From the Business Side, Independents Hall, IndyHall 201, coworking
This week, I got an e-mail from Julie Z. Rosenberg of the Brooklyn Creative League in Park Slope, asking about our newsletter. First off, I always appreciate when people reach out to others for a hand as well as Julie did, as she a great job by asking specific questions and keeping her message brief.
I decided that it could be valuable to share what I shared with her on the blog for others, for future reference and posterity.
Specifically, Julie was asking about format, frequency, content, and distribution.
The rest of this post contains a modified version of my response to her.
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When IndyHall began as a community, and didn’t have a space yet, we operated almost entirely out of a public google group (now defunct), and on Twitter. Once we had a space though (beginning in mid-late 2007), there became a need for public, and semi-private correspondence to happen on different channels. It didn’t make sense to bother everyone with office goings-on, but we also didn’t want people left out!
Right now, our communication stack looks like this, but we’re still experimenting and things change all the time.
Internal:
- We use Basecamp as a message board for all members. Everyone who’s on the roster can post messages to everyone else who is a member.
- We use Campfire as a real-time chat that’s mostly populated by members, but is also open to the public (http://campfire.indyhall.org)
- We still use Twitter a lot
External:
- Our blog (this thing you’re reading) has always been our first line of defense, along with Twitter.
- We’ve used Facebook and AnyVite for event RSVPs, and link them from blog posts and twitter. AnyVite rocks because it doesn’t require a login to RSVP, which Facebook does.
- At some point, we realized that not everyone is following Twitter (or their RSS reader) as religiously as they do e-mail, so a traditional e-mail redux would be valuable.
At this point, we’ve had to work ourselves into a bit of a production schedule to get one e-mail out every other week. One of our full time members, Stephen Winkler, has taken the reigns of the project and is in charge of organizing stories for the newsletter, rallying/drafting content. Dana, our office manager, supplies a couple of specific segments. Other community members have taken ownership of specific segments of the newsletter.
It’s finally gotten into a groove (I think we’re 4 editions in with an actual production timeline), and we’ve only missed the ship date once 
.
Bottom line is that we’ve found that no single channel is effective enough. We’re always morphing along with our community and trying to find the balance, and expect that the balance will always be changing!
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By the way, are you subscribed to our bi-weekly newsletter yet? It’s easy, just head to IndyHall.org if you’re not already on the site, and the sign up is on the left hand side of every page!
Coworking 201: Where are all of the people?
Filed under: FAQs, Independents Hall, IndyHall 201, coworking
Every time I see someone who’s struggling to find members for their coworking space and finds themselves sitting alone in an empty room more often than not, I cry a little inside.
As you may have realized by now, there’s not a lot of incentive to leave your house for another room with nobody in it. In order for the value proposition of coworking to be complete, there needs to be *people* to cowork with!
So you’ve already made the mistake of opening the space without any community buy-in. What can you do?
We suggest rituals.
Consistency is critical for building up the mass, and humans are habitual creatures. If you can come up with a way (Tony had some great suggestions) to get people in the mindset of “today’s Tuesday, it’s coworking day!”, you win. Better yet, give them a reason to bring others, and tell others about their coworking day.
Have you also done research on your price point? If the value proposition isn’t well balanced (cost for the day >= the benefit of the day), you’re going to lose repeat visitors and ultimately, members who join.
Are you in an “ideal” location? Location is hard to change once you’ve already started a space, but our friends in Miami learned the hard way the problems with a poorly selected location.
You need to find out where people who might be interested in your space are already hanging out, and become a part of what they are doing. Don’t show up and try to be a pitch-master, you probably aren’t.
When I say “be a part” of what they’ve got going on, I mean pay attention to their culture, their community, and look for ways to give to them something that they are missing. If you can become a part of their day to day rituals, you’ll begin to feel the formation of the critical mass you’ve been looking for.
No events to be a part of? Start throwing some of your own to get the ball rolling. We started early on with The Junto, Cream Cheese Sessions (our variation of Jelly), and lots of happy hours.
No matter what, you’re not going to see change overnight. Keep at it. Remember, ritual = consistency.
Also, listen to what the people who ARE coming out are interested in, and modify your events for them and their interests. Learning how to process feedback early is going to help you a LOT in the long run.
IndyHall 201: Communities of Trust
Filed under: FAQs, Independents Hall, IndyHall 201, Kudos, Movies, Videos, coworking
We’re back with another IndyHall 201 video. This time, we’re talking about the importance of establishing trust as an important community value in your coworking space.
A few weeks back, I gave a professional development seminar at the Comcast Interactive Media group, and this topic came up indirectly. The question was asked, “what makes a coworking space such a hotbed of innovation?” While the diversity of talent is certainly one of the aspects, even diversity provides little value without a network of trusted between the talent that works together.
Proximity helps too, but the most important thing you can do is lead by example. More on that topic coming up soon.
In the mean time, enjoy our video on building communities of trust!
IndyHall 201: The Iterative Process
Filed under: FAQs, Independents Hall, IndyHall 201, Kudos, Movies, Videos, coworking
A couple of weeks back, we posted a rather long “FAQs” style video that Geoff and I shot while in Austin for SXSW. We’ve gotten quite a bit of positive feedback from that post, so we’re glad to continue that effort.
Only this time, we’re not asking you for nearly an hour of your time. We’re going to keep these under 10 minutes.
We’ve started a series that we’ll call “IndyHall 201″ for the time being. These are some of the things that we consider important fundamentals, but are a little bit higher level than the usual line of questioning we get, hence the “201″ class level. Get it? Good. Moving on.
One of the first topics we wanted to cover was one that we take for granted, but people outside of the software world don’t necessarily have exposure to:“The Iterative Process”. In this video, Geoff and I spend a few minutes talking about Agile as a software development methodology, as well as decision making skills that we’ve employed along the way while developing IndyHall.
A whole lot of digging into localized trends happens on the Coworking google group, usually to appease an investor.
One of my favorite quotes is from Josh Kopelman (Philly/SF Venture Capitalist, founder of Half.com):
“I’d much rather fund an entrepreneur that can adapt to change than someone who claims they can predict the future.”
http://twitter.com/alexknowshtml/statuses/783133234
Rather than asking what our (or any coworking space’s) membership, growth, square footage, expense numbers look like, why not ask what things we attribute to changes in our numbers, and how we operate around those changes?
Nobody ever asks us those questions.
The answers to those questions are the ones that provide insight into how to iterate, and grow your coworking space and community, without trying to predict the future. They’re going to make you a stronger entrepreneur, and a happier person in general. How’s that for Kool-aide.
We hope you enjoy this installment, and be on the lookout for more to come! Feel free to post questions here or in the video time line.
Coworking 201: The Iterative Process
“The essential ingredient is the workers”
Filed under: FAQs, In The News, Independents Hall, coworking
The [coworking] space can be in a renovated house, large office or custom building. But the essential ingredient is the workers. “A coworking space, without the community of people to go along with it, is called ‘an office,’ “ says a Web site devoted to the concept.
Nice. We totally agree.
“Free” is a lousy motivator
Filed under: FAQs, From the Business Side, In The News, Independents Hall, coworking
I’ve never really thought that free days made a good incentive to convert non-members to paying members, short or long term.
In the short term, part of the barrier to entry created by paying for membership at a coworking space is dedication and commitment. Free isn’t a good way to start a committed relationship. Furthermore, even our night shift members have pointed out that they get more done in a 4 hour session that costs $10 because they know they should; sitting on the couch working on their side projects is free, but that means that slacking has no real cost. When you slack AND you pay for your desk-time, your utilization patterns change.
Furthermore…there’s the factor of intrinsic vs. extrinsic motivators.
Extrinsic motivators, like providing things for free, or other monetary (or otherwise token) incentives may work once. It may work a few times. Even several times. But odds are, if your goal is to charge money in order to sustain at some point, the “free-ness” will have to go away at some point. And then expectations need to change and you’ve taken a technical problem (cashflow) and made it a social problem (commitment).
Free is an extrinsic motivator. Business services are extrinsic motivators.
Community is an intrinsic motivator. Being empowered is an intrinsic motivator.
Intrinsic motivators are the ultimate in sustainability. They’re harder to provide initially because you have to figure out what they are, but we think it’s worth it in the long run.
It only takes ten
Filed under: FAQs, From the Business Side, coworking
If you’ve read some of our responses in the Coworking google group, or seen the videos we’ve produced so far, or seen either of us speak on the topic of community building, you may have heard Geoff or I say “It only takes 10″ committed people to start a successful coworking community.
In the case of coworking, that “10″ number is variable, but a likely minimum, to having enough people to validate the concept for your area, and start helping spread the word.
Need more proof? The mantra that Geoff coined showed up on Seth Godin’s blog this morning.
http://sethgodin.typepad.com/seths_blog/2009/04/first-ten-.html
While Geoff’s point and Seth’s point are slightly different, the core concept is strikingly similar: if you’ve got a core, committed audience of 10, you can translate that to a degree of confidence that should help you take the leap to move forward with your project.
Additionally, this is another example of the fact that community building is replacing marketing, and coworking has an opportunity to pave the way for that shift with good examples and case studies.
Have you seen the number ten come up in groups like this before? I’d love to hear other examples.
SXSW, Coworking, And A Video about some Frequently Asked Questions
Filed under: FAQs, From the Business Side, Independents Hall, Movies, coworking
Geoff and I got back at the end of last week from SXSW Interactive, where thousands of geeks from around the world converged to discuss topics of design, technology, business, community, marketing, social media, etc.
Not only did we attend, but we were presenters: I ran a core conversation that was not only well attended, but included representation from around the world and from all different walks of coworking life. Additionally, Geoff was on a panel about “Building Regional Whuffie” and attracting innovation to your city with some other coworking space founders: Susan Evans from Office Nomads in Seattle, Julie Duryea from Souk in Portland, Matthew Wettergreen from Caroline Collective in Houston, and moderation by Tony Bacigalupo from New Work City in Manhattan.
Furthermore, the now annual Coworking meetup at the Hotel San Jose organized by Julie Gomoll from Launchpad Coworking once again fused the global coworking community for an evening of drinks and conversation, hugs and inspirations. It’s one of my favorite evenings of the year, as it seems like the Coworking Google Group descends on Austin Texas and we all get to share meatspace for a few hours.
And finally, but certainly not to be overlooked, was the first time we got to visit Conjunctured, Austin’s first coworking space that opened up shortly after it’s founders spent time discussing their concerns and hesitations with Geoff at last year’s SXSW Interactive. They’ve done a phenomenal job, and it was really great to attend a “Jelly Talk” in their coworking space. It was also great to finally meet Amit Gupta in the flesh. After many near brushes with each other over the last 2 years (and plenty of conversations online and on the phone), we finally got to shake hands.
I’m sure I’m leaving out some coworking highlights (like high fives with the crew from Beehive Baltimore, brilliant chats with our coworking friends in Paris, and being called a “Paragon”), but they aren’t the point of this post anyway.
Last year seemed to be a breakout year for Coworking in regards to SXSW as a focal point. Through the year, Tony B and myself had a number of calls with Hugh Forrest, the main organizer of SXSW Interactive about the conference’s influence on Coworking, and the potential for coworking’s influence on the conference. Hugh remains supportive, though I understand where he’s stretched thin. More on that later.
Geoff and I began to notice that this year, Coworking had certainly matured. The number of spaces has increased. Many are beginning to stabilize, and communities are really beginning to galvanize and do great things for their local communities. Those are the spaces that are at the same or similar levels of evolution to IndyHall, and continuing to exchange and dialogue with those communities excites us.
But as the movement continues to grow, the same basic questions continue to be asked by new groups entering into the fold. This isn’t a bad thing by any stretch, but it’s not sustainable for us to keep answering the same questions over and over (or anyone, for that matter).
We’re in the process of formalizing some of our thoughts and processes, but in the mean time, wanted to share some of our content with the coworking world.
We took an afternoon and sat down at the Hotel Saint Cecelia and propped up my Flip cam, and produced a 50 minute video answering 15+ of the questions we get asked the most about IndyHall and coworking. Despite some noisy conditions (produced by an unexpected landscaping crew), the video turned out well and we’re excited to share it.
We just posted that video live at a new page on the IndyHall website, specially designed for this new venture. Our number one goal here is to allow us to point people to this website (and we encourage others to do the same) when these questions get asked. This will free us up to continue evolving IndyHall, and working with other coworking communities who are evolving past the fundamentals as well.
We’ve licensed the video Creative Commons Attribution Non-commercial Share-alike to encourage people to take this content and reproduce and republish it in the ways that they see valuable, so long as attribution remains. You can even download the original .mov source if you like.
This is the first (and the longest) of the installments that we’ve created and will continue to create. If you have specific topics that you’d like to see us cover, leave a comment here or tweet the question to us (I’m @alexknowshtml on Twitter, Geoff is @geoffd) and we’ll be sure to cover it in a future episode.
Oh, and to tie this all back to SXSW, we’ve got some ideas on how coworking principals can help SXSW continue to grow without consuming itself. Would anybody be interested in hearing an episode covering that topic?
