Howdy readers! Alex here, with a very rare guest post on my site. This story is packed with valuable lessons (and a smart, fun, honest approach) that I wanted to make sure as many people saw as possible. So please read, share, and leave a comment!  

Margo Aaron is the founder of The Arena, a coworking community of freelancers and solopreneurs who help each other kick ass in business. 

Without further adieu, here’s Margo sharing her story and the lessons she’s learned along the way. Enjoy!

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_This whole thing started with a Google Doc.**

I emailed 66 people with a link to my Google Doc sales page and within a few days I had 30 applications for my virtual coworking space that did not exist yet.

I told myself if I could get 20 paying customers, then I would keep this thing alive and see if we could grow it. Over the next few months, I had almost 30 paying customers and doubled our prices. We were onto something.

Back when I was running my marketing consultancy, I was tired of working with corporate clients so I started writing about marketing on my website, That Seems Important, and began amassing a list of founders, solopreneurs, and freelancers. My people. The marketing contracts that you get from working with this population is tiny compared to the deals you can score with corporate clients. But corporate clients were driving me nuts and I didn’t want to work with them anymore.

After getting on call-after-call with founders who were stuck, I discovered something curious. All of them were coming to me with marketing problems, but NONE of them had actual marketing problems.

What they had was self doubt.

When you’re a company of one, it’s easy to get stuck in your own head. Constantly overthinking what to do next and nervous that you’re doing the wrong thing.

10/10 my conversations with founders went like this:

“I know I need to do XYZ”

“So why aren’t you doing it?”

“Excuse excuse excuse excuse”

We’d get off the phone and they’d thank me emphatically for my time and advice.

Only…I wasn’t sure why. I wasn’t telling them anything they didn’t know. All I was doing was giving them permission and confidence to do what they already knew they needed to do.

And that’s when it hit me: Selling this population marketing consulting was never going to really help them because they didn’t have a marketing problem.

What they needed was the confidence to jump in, trust their instincts, and do things wrong.

Their self-doubt was exacerbated by the fact that they were all alone. Literally and figuratively. They weren’t in places like SF or Austin where online entrepreneurs running virtual businesses are a dime a dozen. They were in Fayetteville and upstate NY, where it is extremely difficult to find like-minded people doing similar things.

They had NO ONE like them to talk to, banter with, bounce ideas off of, or just normalize their seemingly “weird” behavior (all of us entrepreneurs are weird, that’s what makes us awesome).

Instead, every day they faced a sea of critics and “normal” friends with normal jobs who didn’t understand them or their business. They had no one to talk to when they got stuck or insecure. When I got on the phone with these folks, I never taught them anything about marketing they didn’t already know. But our conversation gave them the confidence to execute what they knew they needed to execute.

That’s when I realized how to solve the problem.

Lesson 1 – These people didn’t need more courses on marketing – they needed coworkers.

They needed people to brainstorm and banter with, people they could ask dumb questions to, people who understood what it was like to feel like you’re failing all the freaking time – but also have these HUGE wins (all in the span of a single day).

That’s what lead me to the idea of “virtual coworking:” It would be a community of like-minded people who are your coworkers, just like a real office. People (who aren’t your husband) that you can talk shop with, who LOVE to geek out on things like UTM codes and copywriting.

It would function just like coworkers function in a real office – where you IM between conference calls, have meetings to brainstorm stuff, and have a water cooler to complain about your industry or talk through stuff you’ve been marinating on for months.

That’s what lead me to this headline for my Google Doc:

“What You Need Isn’t Written Down. You Don’t Need Another Course – You Need a Tribe.”

To date, it’s the highest converting headline I’ve ever written.

Lesson 2 – The Portal No One Cared About

Once I had proof of concept, it was time to start investing in the space and turning this into something “real.” I took our profits and hired a developer to create a “proper” membership portal to replace our password-protected WordPress pages.

5 Months later it still wasn’t finished and full of bugs and was taking up the majority of my time. But I knew it needed to exist. We had doubled our prices and I couldn’t justify the price increase without a portal (or so I thought). It looked bad to be charging premium prices without offering basic functionality, like being able to update your credit card or cancel without having to email the founder. I also couldn’t protect my intellectual property (well) without a portal.

If someone quit and was no longer a member, they still had access to all our content because I didn’t want to change the PW to the WordPress pages each time. It was really unprofessional. Fine for a beta test, not great for a real product.

Thousands of dollars and hundreds of hours later, we got the portal to “good enough” and announced it to the tribe. I was proud of what we’d built, but more than anything, proud of the content the portal displayed. We had a Video Vault of all our member-led workshops and expert interviews. We had tech tools that member’s recommended. We had a catalog of current members where you could look up who everyone was and find out cool fun facts about them. We had a calendar of upcoming events. And we had your account details so you could control your own payment and membership terms.

We had everything!

Except there was one problem: No one cared.

Despite having received criticism from people when I first launched about how “unprofessional” it was to not have a membership portal (and command the rates we were charging), no one used the freaking portal.

All that stress over design and functionality and keeping it updated and maintained – NO ONE CARED.

Which was my first #facepalm moment: Stay focused on your REAL value proposition. People were paying a premium for the connections to quality people like them. Not for content. The buyers (people who were actually members of the space) never complained about not having a membership portal or a hub for content. They just wanted a place to connect with each other.

And even more interesting (but not surprising), they wanted to connect in places where they were already hanging out. Meaning: no one wanted to login to something new. They wanted to show up where they were already showing up. Which in our case, was Slack and Zoom.

Takeaway for us: get clear on what you real value proposition is and don’t waste time on the things no one cares about.

I wasted months and a lot of cash creating something that was irrelevant to my end user’s experience. I was constantly paranoid about fixing bugs no one noticed and keeping content no one accessed up to date.

Caveat: the perception of having a portal did have a halo effect on new users. It acted as a feature that justified a higher price. Something people expected to be included with membership. They liked knowing it existed. But they still (dramatic pause) didn’t use it.

Lesson 3 – Exclusivity Is The Key To Community

I know what you’re thinking. Community is supposed to be about belonging and inclusiveness. Exclusivity is literally the opposite

But hear me out.

The paradox of belonging is that in order to “belong” to something, you by definition don’t belong to something else. If you make “soccer club” inclusive of other sports, it stops being soccer club. It’s just “sports club.” And if you make “sports club” inclusive of people who paint and sing, it just becomes “club.”

Some call this “niche-ing down,” but I’m going to argue that it’s more than that. We have a niche – that’s for sure. You get to our home page and either you get the joke or your don’t. You know within minutes whether you’re “one of us.”

That part is “niche-ing.” We appeal to solopreneurs, lifestyle entrepreneurs, and freelancers. And a specific type of each of those. They’re after more than just money – they’re after impact.  They want to make a difference, but how they make that difference varies. Within the world of entrepreneurship, it’s sexy to be building the next “disruptive” technology, but our people aren’t interested in building the next Facebook or even building the next TOMS. They make a difference through the quality of their work and having a business that serves their life.

For example, one of our members has four kids under 10. And he is changing the world by simply being a more present dad. He built his business so he could pick up his girls from school and not have to take meetings after 3PM. Those are the people we are after. The people who have families and mortgages and aren’t interested in “working from the beach.”

Anyway, it’s a very very very specific sect of people.

On top of that, to be a valuable member of a community is different from being a wonderful customer. It is a specific personality type that works well in a tight-knit group of people. You have to care, you have to be willing to give as much as you take (if not more), and you have to actually want to participate.

I’d made the mistake of letting the wrong type of people in when we started out and I saw what it did to the group dynamic. In order to cultivate community, my folks needed to feel protected. Instead of simply being the founder, I became like a fiduciary to the tribe.

It was my responsibility to find and include people who were “one of us” and part of that required actively excluding good people who weren’t a great fit.

This. SUCKED.

And it cost me a lot of money.

Most spaces that bill monthly with a membership revenue model make money by adding more members. As a result, they often let anyone in because, duh, that’s how you scale. In our competitive set, the qualifier for most communities is revenue.

I refuse to judge our members on revenue because that doesn’t tell me what I need to know about you. Our members are defined by their action not their success. We don’t care if you’re failing as long as you’re out there, brushing yourself off, and getting back up.

The only thing we don’t want are people who are all talk, don’t take action, and are constantly asking for advice and feedback, but never offering help to others.

Unfortunately for me, those are the people who pay for these kinds of things. We call them “wantrepreneurs.” They’re the ones who jump from idea to idea and never really commit to anything. They like the culture of entrepreneurship, but aren’t actually entrepreneurs.

We don’t let those people in.

It hurts. every. time.

Because those people sincerely need a tribe. And they’re good people who need support. We’re just not the right space for them.

I am fiercely protective of who we allow into the space. Our members are the most important part of what we’ve built. If the portal and Zoom disappeared tomorrow, it wouldn’t matter because our people are what make this thing valuable.

Here is how I managed to successfully exclude people and foster a strong sense of community among our coworkers.

First, we made it a lot of work to get in: To get into the Arena you have to fill out a long-but-entertaining application, qualify for an interview, endure said interview, and then wait for us to determine if you’re in.

If you’re not serious about being a member, this process will discourage you which is exactly what it’s designed to do. We want to deal with only qualified leads and by making it a little difficult to sign up, we end up with only people who are serious.

Second, we added qualifying questions to our application. In the beginning, I was wasting a lot of time interviewing people who I could tell were not a good fit from the first 45 seconds. I couldn’t figure out how they were getting through, until I realized I wasn’t asking the right questions on the application.

So, I used the application to vet and qualify candidates. We have questions like, “If you got in, how would you help your coworkers in the Arena?” This does two things.

First, it subtly emphasizes that you’re not immediately accepted despite having filled out an application. This adds to the scarcity and exclusivity of the space. Second, it primes you to think about what you can offer instead of what you can get. Which is the basis for any good community, but the opposite of what we consider when we’re about to pay for something premium.

When we’re about to pay for something premium, we think, “What’s in it for me?” (understandably). But asking the question in this way helps us select for people who get joy and value out of helping others – those are the kind of people we want.

We also added a question about willingness to invest in something like this. If people only have $40 in their budget, they’re not going to be interviewed no matter how great they are. Our prices are published on our website. We’re not hiding how much membership is. If you didn’t do your due diligence or cannot afford our space, it wastes both our time and yours. So we added a question to make sure people know this isn’t a free Facebook group (you would not believe how many people think that). It’s a paid space, that’s carefully and deliberately curated.

Third, we proudly exclude people. It sucks. And I hate it. And it never gets easier. Especially if the applicants are colleagues or people I genuinely like. But what the member’s need is more important than my desire to stay liked. And the lost revenue is offset by the high retention rates we have as a result. People appreciate the lengths we go to to keep the space intimate and high quality. We will never take anyone in just because they offer to pay or because “it’s more scalable” this way. In fact, we know this model doesn’t scale and that’s precisely why it works.

Fourth, we make 1:1 introductions. When you are first accepted into the space, there is a formal onboarding process that happens. (This is why white labeling what we do hasn’t worked so far, btw. There is a manual component that NO ONE wants to actually implement. They just want to throw a bunch of people on slack and expect them to interact – which doesn’t work). Even the most outgoing extroverted people have trouble being thrown into a sea of strangers online. You cannot expect awesome people to connect without giving them some prompts and making them feel comfortable.

So part of our onboarding process is introducing you, personally, to other members, so you go in seeing some familiar faces. We choose which members we intro you to based on your business needs and/or if we just think you’ll get along and be friends.

Note: We do NOT say “Hey John, meet Sally. Sally, meet John. Kbye!” Our introductions are long and personal. We give members a lot of background on each other and (most importantly) tell them WHY we think they’ll get along and should connect.

Fifth, we have standards for how you’re allowed to participate. There is nothing worse than a group that is either being dominated by the founder or is full of meaningless self-centered posts, like, “Hey guys! I just wrote this! Could you share?” I publicly shame people who post like that (though tbh those kind of people don’t get it in).

We have quality standards for interaction and participation that we are very strict about. If you’re going to pose a question to the group or share something you wrote (or read) you must give us context and explain why you’re sharing it and what you want from us. Are you looking for feedback? Vanity likes? Did you learn something and want to make us aware too? WHY should we read this?

The most valuable asset we all have is our time. And to post vapid and meaningless self-serving content is disrespectful to your fellow coworkers.

As a result, our community threads end up being really substantial and very personal. People post long, personal, and detailed posts about their business questions and the dialogue is RICH with insights, personal experiences, and advice.

You Cannot Fake This

The thing about community is that everyone claims to have it, but few actually do. The irony is none of this is rocket science. Anyone could steal my model (not my trademark, though #boom) and the reason they don’t is because it is a LOT of work.

If you don’t genuinely care about your people and get in the weeds with them, you’re not going to succeed in building community. There is no way to short cut this.

Adding people into a Facebook group or giving them access to an online message board where they can post questions doesn’t equal community. Community happens when people interact with one and other. Outside of you. Your job is to create the container and facilitate the interaction – and that’s the part you can’t half-ass or fake. Because you end up with superficial or transactional relationships instead of real ones.

Community doesn’t work if it’s not based on something real.

In the end community hinges on one thing: people. If you think about your people and what they need instead of what you want to build or what “makes sense” or what your competitors are doing, you’ll have a lot more success in cultivating community. Finding a way to facilitate real, genuine connections amongst your members is what this is all about.

It’s more than building a sales pipeline or networking or partnering on deals. It’s about relationships.

When we were collecting feedback from members on why they stayed in the Arena, I was expecting people to say, “EXPLOSIVE GROWTH!” since that was sorta what I was aiming for. My thought was if I connect you with people like you (or a few steps ahead of you), you’ll have no choice but to level up. (Remember this came out of a MARKETING consultancy and a hypothesis that if I connect you with people like you, you’ll have more confidence to do what you know you should do to grow your business).

And I was right. Just…it wasn’t in the way I expected.

“The Arena improved my marriage.”

Yeah, I know, I was shocked too.

Over and over I saw the same response from members. Having coworkers to talk to about their business allowed them to be better husbands, wives, moms, dads, managers, and friends. Their businesses grew along with their confidence, but that’s not why they stayed.

There is more to business than financial growth.

That’s where community comes in. We’re the other part.