About Me

Hi, I’m Alex.

I build communities, started one of the longest running coworking communities in the world, write a crapload of words every day, tweet a little too much, coach people to be the best version of themselves possible, can't stop learning new things, and do my very best not to take myself too seriously.

I have one goal: to fill the world with truly excellent collaborators so we can all work together, better.

Because let's be honest...most of us aren't very good at it.

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Together Turning the Page, in 3 Acts

Act I

Back in 2006 when I was scouring Philadelphia for smart, interesting, creative people to eventually become a part of Indy Hall, one of the first people I met was Chris Nagele. Chris was running Wildbit, a software design and development consultancy that cared immensely about its craft, and at the time was the only person from the team in Philadelphia besides his girlfriend, Natalie. We quickly became friends and supporters of each others’ work, and I can remember when Wildbit launched it’s now very popular version control hosting system Beanstalk as “Project Alpha” just a month before we opened the doors to Indy Hall.

When Natalie joined Chris full time at Wildbit, they decided to officially become members of Indy Hall and proudly made our coworking space Wildbit’s headquarters.

I got to work with a few of Wildbit’s other team members over the coming years –  which wouldn’t be surprising if you didn’t know that the team was spread across the globe. Chris ran (and still runs) one of the most talented virtual teams I’ve ever seen, having developed his own practices for recruiting a team and building products together in spite of up to 12 hour time differences. While they were still doing design consulting, I even got to hire them for a couple of projects and worked closer with some of the remote team members.

When Chris and Natalie got married and started their family they chose to move their office back home, but remained devoted supporters of Indy Hall. In particular, when we moved into our new office in 2009, Natalie collaborated with Dana on much of the early interior design touches that made the new space much more vibrant and friendly. Chris and Natalie’s daily participation waned with the birth of their daughter, but their support of me and of Indy Hall never wavered.

Act II

It was near the end of 2010 that an unexpected conversation led to an exciting proposition: Chris and Natalie wanted me to join Wildbit as their first Philadelphia team member. I took on a proactive communication role – spending time with our customers and partners outside of the standard support channels, getting to know our customers and our market better.

In just over a year since joining, we added 4 more amazing Philadelphia team members and moved the local team into a beautiful office on the 7th floor of the same building as Indy Hall. I got to go on two team retreats to Spain to spend time with my international league of coworkers. I challenged and changed some perceptions and habits of the team, and had some of my own challenged and changed as well, in all cases to our mutual benefit. I interacted with some of the best customers on the planet, collaborated on launching features and marketing efforts with a team that feels like a family, and together we learned and applied our efforts to growing two products – Beanstalk and Postmark – that the entire team is proud to provide. And most recently, we launched a mentorship community and program for bootstrapped ventures with a roster of product founders that I’m very proud to call my friends.

One of the challenges of the role that we knew from the start was that I would not be able to be full time – my responsibilities to Indy Hall and other projects/partners were important to me, and thankfully Chris and Natalie wanted me to be able to continue with those efforts. The fact is that I’m rarely, if ever, only working on one thing at a time and while it looks manic and chaotic from the outside (which sometimes it is), the value I’ve always found has been in my ability to apply lessons from one project to the benefit of another. That cross-pollination is ever-present in my work, and it’s a big part of why I choose to work the way I work. I really do love it that way.

Act III

The unfortunate side effect of that choice, though, is that there’s little room for permanence. With the decision to grow Indy Hall comes the difficult decision to end my time on the Wildbit team. It goes without saying that there’s been nothing but support and love from the Wildbit team as we made the decision for me to transition away from my daily role on the team.  We will continue collaborating on ThinkStrapped, though, and I’m looking forward to meeting the founders and teams of the 10 companies we recruit early this summer.

The last 18 months together were really only a concentrated exposure to what I’ve seen Chris, Natalie, and the team accomplish since meeting them in 2006, so I’m excited to see what lies ahead for Wildbit – I’m 100% certain that it’s nothing short of amazing for the team and customers alike. It’s difficult to think about not being a part of that future. I remain a loyal fan and supporter of Wildbit, their products, and perhaps most importantly their customers, many of whom I’ve forged relationships with over the last year and a half.

At the same time, Indy Hall is exploding with potential of its own and I’m beyond excited to be turning the majority of my attention to it for the first time in over 2 years. The “expansion” ahead includes much more than just adding a few thousand square feet to our footprint and a bunch of great new community members to our roster.

So it’s not exactly a goodbye to Wildbit and crew, but instead turning the page to a new chapter for all of us to begin writing.

Love and thanks to Chris, Natalie, Ilya, Eugene, Igor, Milan, Dima, Oren, Tema, Dana, JP, and Russ; and to all of Wildbit’s customers and partners I got to know and appreciate – you know who you are.

Wildbit, I think I love you.

How Much Does It Cost To Start A Coworking Space

I answered this qurestion on Quora and decided to post here for the rest of the normal world :).

This question actually has 3 questions hidden inside:

1) How much does it cost to start a coworking space 2) How much does it cost to open a coworking space 3) How much does it cost to run a coworking space

I’ll address each one.

1) How much does it cost to start a coworking space

Starting a great coworking space can cost absolutely nothing, because coworking doesn’t require a dedicated space to do it. In my essay How to Fund Your Coworking Space I explain the importance (and value) on developing community before opening a physical workspace with all of the associated overhead.

Even if your goal is to run a coworking space as a business, this process gives you a number of advantages – you open with revenue, momentum, and buy-in from community members. You can ask them questions rather than guessing. You can avoid spending money on things they don’t need. A lot of the hardest work behind you, because finding people is much more challenging than opening the doors to a shared workspace. And you have complete ownership of your business and the ability to answer to your community instead of an investor – because the community IS your investor.

You don’t need to worry about finding your ENTIRE member-base before starting, you can start with 10 people. Not just 10 people who are interested in coworking, but 10 people who are addicted to being around each other and would happily pay for access to have a place to do that on a regular basis.

It’s easy to think of this process as building the club and then building the clubhouse.

So you can – and I’ve often advised that you should – start a coworking space by spending $0 and focusing on the community first.

2) How much does it cost to open a coworking space

Your start-up costs will vary depending on some of the following things:

  • The size of your initial & anticipated community
  • The needs of your initial & anticipated community
  • Local real-estate conditions
  • Available real-estate connections

Costs to consider, with examples of what we pay (or paid) in Philadelphia:

Our initial 1800 square foot Indy Hall $6,000 for rent x 3 (First/Last/Security) $2,000 for 20 desks & chairs from Ikea $150 for a wireless router $500 for a 1 year insurance policy $300 for misc things like trash cans & bags, cleaning supplies, etc

This does not include operating costs (like electric, internet, etc), which I’ll talk about in the 3rd section. It only includes costs needed to open the doors.

When we started this space, we had ~20 members, but only 2 full time members – the rest were only coming a few times a week or once month. We gave many members the option to pre-pay their memberships for up to 6 months (with incentives to do so) and collected ~$4,000. I put $10,000 of my own money into the pool for a total budget of ~$14,000. This allowed us to cover the above expenses plus a couple of months of operating expense runway until we could cover our ongoing expenses with memberships. Inside of 3 months we were breaking even and inside of 15 months we returned my $10,000 investment.

Our second (replacement for the original) 4500 square foot Indy Hall $18,000 for rent x 3 (First/Last/Security) $1,600 for additional workstation furniture $600 for first conference room table & chairs $300 for whiteboards $3,000 for networking equipment $2,000 for projector & installation equipment $5,000 for misc furniture, lockers, kitchen supplies, etc

Again, this does not include operating costs (like electric, internet, etc), which I’ll talk about in the 3rd section. It only includes costs needed to open the doors.

We were able to move a lot of our existing equipment and supplies from the original space to keep our costs down. Moving into this space we had grown to 21 full time members, and nearly 50 basic & lite members.

We invested in our network because near the end of our stay at the original office, the load on our wireless network became problematic and we decided that it’d be useful to run gigabit ethernet to all of the workstations. We went a little bit overboard in hindsight, but it was still a worthwhile investment for the group once it had grown past >25 daily attendees.

This move’s costs were covered by ~$15,000 in savings from profits + a $30,000 loan from one of our members. When we proposed the growth to our community and asked for their feedback, multiple community members stepped up offering to loan us the money. We considered taking the money as an investment and bringing the funder on as a partner, but ultimately decided against it – not because we didn’t want him as a partner, but because we felt that money was the wrong reason to bring somebody on as a partner.

With a total budget of ~$45,000, we were able to successfully execute the move, carry the idle costs of our original space for ~2 months until we found a new renter for the landlord, and have some runway to get the new space up and running. We were able to break even in ~5 months, began paying the loan back inside of 12 months, and the loan will be paid back in full inside of 36 months.

In addition to local costs being varied, both of these scenarios depend heavily on having a community first. This bootstrap approach not only affords you the money, but the ability to leave certain expenses out of the equation, including unneeded equipment and labor costs. Need to paint the walls? Have a painting party. Assemble furniture together. The process of co-designing and co-creating the workspace helps transform the coworking space in your members minds from a “serviced” space to a place where they can – and should – contribute to it’s ongoing creation.

It also depends on the space being in “constant beta”. Being willing to not do certain things means keeping your start costs low, and always be introducing new things. Many new things being introduced will be at the request of members, meaning you haven’t spent money on things that aren’t being used. Once again, having rough edges that your members can find and contribute to the polishing of helps them define the space for themselves. This not only alters their expectations and subsequently, their interactions, but it tends to improve recruitment and retention as they will be more excited to bring friends to participate and stick around longer.

3) How much does it cost to run a coworking space

Much like starting up, ongoing operating costs vary heavily depending on location. Local utilities, taxes, etc contribute heavily to the varied budgets.

This list is not exhaustive, but instead an overview, of our monthly fixed costs.

  • Rent + taxes
  • Part-time office staff
  • Electricity
  • Internet
  • Cleaning service
  • Coffee
  • Management software (Basecamp, etc)
  • Office supplies

1800 square foot Indy Hall

Total monthly operating costs were ~$3600/month at our peak costs, slightly more in winter and summer months when electricity usage spiked.

4500 square foot Indy Hall

Our total monthly operating costs are around $9,000.

One thing to note in both cases is that our staffing costs were able to stay extremely low because of our community-oriented approach instead of our service approach. Part time office staff supplemented myself to make sure the office was opened/closed each day, and keep administrative tasks moving along, but overall it wasn’t more than 10 hours/week of actual task work. Community members contributed heavily to operations, pitching in where paid staff would normally service office share-ers. This is again part of the expectations set by being a community member – “cheap rent” comes with some additional expectations.

Because of our “constant beta” approach, money is spent each month on introducing new things to the coworking space as well, but it’s largely variable by what it is and how members contribute to introducing/creating it.

We also often trade services “in kind” for membership, either discounted or full membership offers in return for things like design work, event management, and other contributions. This helps keep members engaged, and our costs low.

Also missing from these figures is the time invested by myself, Geoff, and many of our early members. Again, the value of this time was anything but “lost” by doing it ourselves – in fact, it’s part of what made our community as rich as at is. But if you’re in a position where you are paid for your time (as I was when I started Indy Hall), those opportunity costs should be factored in. Making the transition from hourly work to higher-valued retainer work and longer-term contracts had a huge impact on my ability to stay focused and financially comfortable.

I’m open to sharing as much as I can about our operations. If you have specific questions that I missed in this outline, please let me know in the comments and I’ll address what I can. You can also join me for my next Coworkshop, where I’ll spend a half-day covering all of the ways that this approach to coworking can be executed and grown with success.

Made by Hand – My Notes on Craft & Movements

Geoff turned me on to this remarkable series called “Made by Hand”, a Brooklyn-based film series covering the stories behind handmade objects and the people behind them.

The second short film in the series, follows knifemaker Joel Bukiewicz through his personal journey of becoming a craftsman. Like Geoff, I identified strongly with Joel’s story and took notes on a few themes that stood out to me.

“It doesn’t cost much to start – just time”

I’m a devout bootstrapper, for a lot of reasons including of my relationship with money. It’s not that I don’t have big ideas – believe me, I do – but I know that most of the time I can start with very, very little investment of cash and just a smart investment of my time.

“Cut yourself, burn yourself, fuck stuff up, you never make that mistake again”

While I’ve only bled once or twice for my work, I’ve felt the pain of a mistake. Mistakes are part of the learning process, so long as you’re learning from them and seeing the opportunity on the other side of the mistake.

Once you become competent, maybe you have it in you to become an artist. Maybe you don’t.  Mastery is the 10,000 hours it takes to get to day one.  

I’m still working on my 10,000 hours.

“…studios full of people just…doing shit that they loved to do. I didn’t realize that I could have a community – […] it was like somebody turned the lights on.”

If it takes 10,000+ hours, why would you choose to do it alone once you knew there was an alternative?

The importance of a catalyst (Photographer for Edible Brooklyn)

Joel mentions the editor of Edible Brooklyn being the human catalyst for introducing him to the world outside his own door. Every success story contains this chapter. Every. Single. One. Who’s your catalyst? Who could you be a catalyst for?

“The currency is really rich in community […] in friendships, doing what you want, quality of life.”

“Independence” isn’t much worth the effort if you’re doing it by yourself. Success doesn’t start – or stop – with wealth.

Being rich alone is still being alone.

“More than a community – a movement.”

It’s interesting to hear Joel describe a movement as another layer above “community”. It’s something I’ve said before but have always struggled to describe or qualify.

In Joel’s description, a “movement” describes larger changes that result in the converging of consumer & producer ecosystems. The textbooks define a “movement” as a coordinated group action towards a cause, but I don’t know if it’s always that deliberate.

“If there’s a movement, it’s in the future.”

This sentence was extremely resonant for me. In it’s essence, the idea that we’re not able to see these convergences around us as they’re happening…but we can see that they’re likely to happen.

Max from Cowo Asks: 5 Coworking Questions leading up to Coworking Europe

In just a couple of weeks I’ll be heading to Berlin, my first time in Berlin in fact, to give the opening presentation at the 2nd annual Coworking Europe Conference.

Leading into this weekend of coworking learning and exchange, Max Carraro from Cowo – a coworking network of over 50 shared workspaces across Italy and Spain. Max has been a vocal supporter of our work in Philadelphia and he asked me to answer 5 questions leading up to the Coworking Europe Conference. I’m reposting those questions and answers here as well.

1. Has your own life changed since you practice coworking?

“Changed” is an understatement. It’s hard for me to find something in my life that isn’t somehow related to Indy Hall or coworking. My days are spent, for the most part, working at Indy Hall surrounded by my coworkers (compared to sitting at home and working on projects). When I started Indy Hall I was a freelance web developer. Now I make most of my money applying lessons learned from coworking and from my time at Indy Hall to helping other businesses grow, and only writing code for fun. Many of my closest friends and loved ones I’ve met through coworking. Much of my travel involves a visit to a coworking space.

Literally, everything in my life has changed, and for the better.

2. Is coworking a commodity (i.e. the chance to be share an office with little money) or a strategic option (i.e. a platform for all kind of sinergies)?

There are elements that are commoditize-able, mostly in physical infrastructure, but those elements aren’t unique to coworking so that doesn’t make coworking a commodity – it makes desks a commodity.

Coworking is an experience, and as you said, coworking is a choice. Coworking is about who you work with and how you work. Where doesn’t matter, and it will matter less as time goes on.

You could look at food as a commodity – but consider the experience and the quality. McDonalds is commodity food (and happens to share the cheapness you mention about sharing offices). But people pay money, and spend a lot of time, finding amazing dining experiences because food is better when you share it with others and when it’s created with care. That’s how I feel about coworking – it’s the fine dining experience of the workplace.

3. After all these years of discussing, I think we should know by now if business rhymes with coworking. Does it?

Over the years, there’s been lots of question about the viability of Coworking as a business. Since day one, Geoff and I have beaten the drum of sustainability. We didn’t create Indy Hall to fill our pockets, but to contribute to the interconnectedness of Philadelphia that would ultimately pay off in ways that renting space couldn’t.

And it has.

Sustainability means that growth and retention must go hand in hand. Business and culture are symbiotic rather than parasitic in a healthy coworking space. 

Our book keeper gets nervous every time I share numbers from our books in public. But in our recent year-end planning, we noticed one of our most remarkable growth trends:

In the first 9 months of 2011, our net income grew by 462.8% over the entire 12 months of 2010. And it’s not slowing any time soon.

We’re bootstrapped and have been profitable (defined: make more money than we spend) for most of our history, with some brief exceptions during expansion efforts. But this is an unprecedented growth level for us and we’ve learned a lot through the process.

This is exactly why I’m teaching my workshops. To help people understand that the business and the culture are BOTH important, and help them understand how we make decisions that keep the two in balance.

4. Considering the media craze, the flourishing of spaces, the many online tools coworking-related and… why not, this conference itself, do you envision the risk of tranforming coworking in a sort of bubble, where a minority just trying to make money spoils the beauty of the idea, ultimately depriving the word coworking of its true meaning?

The media’s job is to tell stories. If it’s not telling the stories we want it to tell, that just means that the people talking to the media aren’t doing a good job of telling the right stories.

I don’t worry about the fakers spoiling anything. Bubbles only hurt the people who lose a grip on reality. We stay true to our core values, and the fakers will burn themselves out. It’s a big world, there’s plenty of room for people who want to make mistakes.

5. What are your feelings about coworking as a public service, just like schooling or health services?

If you’re talking about coworking SPACES as a public service, you’d be describing libraries, parks, and other public spaces where people can gather and already do – they just might not call it coworking. Coworking isn’t a service. It’s an experience. You can do it anywhere. I don’t think it’s the government’s job to provide experiences. It’s to serve its citizens.

So while coworking doesn’t need to be provided by the government, I do think it needs to be understood by the government. When we first started having city officials come to Indy Hall a couple of years ago, they said things like “I didn’t even know you could get things done this way”. That’s the kind of positive disruption that a lot of stagnant and bureaucratic governments need. If coworking and government are going to get in bed together, it’s going to be to teach each other rather than provide services for one another.

How I Learned to Make Money

Update: this discussion on Reddit proved more worthwhile than expected, especially considering it’s abrupt introduction.

Update update: And now, on Hacker News as well.


My relationship with money has evolved quite a bit over the last 15+ years, but regardless of who was paying me, or how much they were paying me, one thing has been consistent: I’ve tried to understand where my money comes from.

It didn’t even really occur to me  that there was a problem until after several coaching sessions with newly independent workers and talking to some of my friends about the aspects of bootstrapping a new business, but a lot of people don’t really understand where their money comes from.

Most people know who signs their checks, doles out promotions & bonuses. If they’re lucky they know when their next payment comes in and about how much it’s going to be. If they’re really lucky, they have some degree of control over how much money comes in, by working extra hours or earning extra commission.

But that’s not what I’m talking about. I’m talking about why that money shows up in the first place. Why does that person, be it a boss or a customer, choose to pay me?

You know how to receive money. But do you know how to make money?

Lots of people have forgotten, or never learned, where their money comes from. On the surface, the vast majority of people associate their time with money. “I give 8 hours of my day, 5 days a week, to this company to do what they expect, and in return, I get paid”.

Enter Broken Aphorism #1: Time is Money

When Ben Franklin first wrote this statement, he wasn’t talking about selling your time for money – he was actually referring to the “time value of money“, which is a formula for measuring interest on money over a given period of time. He was not suggesting a correlation between your amount of available time and your amount of potential income. That’s a limitation that we’ve put on ourselves by misunderstanding where our money comes from in the first place.

Enter Broken Aphorism #2: 80% of Success is Just Showing Up

There’s a quote from Woody Allen (I think) that says “80% of success is just showing up”. Even if that aphorism were true, the emphasis is on the wrong part. 80% successes are status quo. 80% successes are limited by the hours in the day that you can “just show up” for. 80% successes aren’t necessarily bad, but they aren’t good, either.

The secret is that in the last 20% of success lies an infinite multiplier of the potential for your success, and the secret to unlocking that potential is in understanding the value you provide.

No matter what your role is at a company, you can practice looking for the value that you bring to that company. The more you understand that value, the more opportunities you’ll see to bring new value.

What Would You Say You Do Here?

Think about the reason you were hired. Not your resume, not what you said during your interview, not what clever marketing copy you had on your consulting website. Think about the process from the other person’s perspective, the person who hired you. In order to make that decision, they had to look at the dollar figure they were committing to you, and make sure that you were able to provide at least that dollar amount or more to the bottom line of their budget.

So regardless of your job title, your position in the org chart, or the size of your office – there is some value that you bring to that business (or are supposed to be bringing) that keeps you in that role.

What is that value?

If you’re client facing, maybe your value is in the comfort that you bring to interactions, and the trust that you build with the company’s customers. If you manage a team, maybe your value is in keeping the team motivated and working to meet goals. If you’re an interface designer, maybe your value is in understanding how a user is going to feel while interacting with your design. If you’re a software engineer, maybe your value is in translating business requirements into functional specifications to code. If you’re on an executive team, maybe your value is in being able to navigate hard decision making with lots of moving parts. If you’re a consultant, maybe your value is in providing visibility into problems that are best understood from an outside perspective.

In these (and any other) cases, the value often lies beyond your function.

This works for products & services, too.

In some ways, you can consider a vendor/customer relationship an extension of an org chart using this value exchange model.

If you’re providing a product or service, there’s a value that exists beyond your product or service’s core function. Maybe that value is that the product is easier to use than the competition. Maybe the value is that your choice of language is more familiar and comfortable to the audience interested in buying. Maybe you provide a feeling of reliability or control that your customer cannot achieve on their own.

Enter Broken Aphorism #3: Make and Sell Things People Want

“Lean Startup” junkies dogmatically recite things like “validate your idea with your customers before you start” as a key to success. Then they provide all kinds of hacks for learning (or guessing) what customers want based on what customers tell you.

I agree wholeheartedly with validation. I don’t believe in dogma.

The problem with this model is that what people want and what people value are often two very different things. It takes a keen skill (and a less dogmatic approach) to understand what people value – and they’ll rarely know exactly how to tell you. In some cases, your customers will know how to describe the function they want, but they don’t have the ability to look past the function for the value they seek. That’s not their fault – it’s up to you, savvy entrepreneur, to learn what they value and then deliver on that. Over and over and over.

Pattern #1: Optimize for value, not time

Once you get some practice understanding the value you bring to an organization, your understanding of your income changes as well. You realize that you’re not limited by your time if you can increase your value. When you transition from “just showing up” to optimizing your value, you start to produce the kind of activity that’s recognized by good bosses and clients alike.[1]

This doesn’t mean you need to be working 100 hour work weeks (or even 60 hour work weeks). It means using your understanding of the value your bring to the company to generate more value during the hours you’re “expected” to be present.

Pattern #2: Find new value to provide

Three possible ways that finding & providing new value can work:

  1. You’ve found a way to provide value that nobody else is currently doing. Do it.
  2. You’ve found a way to provide value that somebody else should/could be doing, but isn’t. Do it.
  3. You’ve found a way to provide value that somebody else already is doing, but you can improve it further. Do it. 

The Hidden Bonus of Bootstrapping

When you’re bootstrapping a new company, venture, or project, you have the closest relationship with the value you provide because it’s the main thing keeping that company, venture, or project alive.

When every dollar you make comes from the value you create, you improve your ability to understand that value – and your skills for identifying new value to create get sharper.

This is How To Make Money

It’s taken me practice, failures, and lessons from some incredible mentors, but I learned how to make money. Which means you can too.

Like you, I knew how to receive money, but I hadn’t really learned how to make money.

Now that I understand where my money comes from, I see incredible potential around me for making more money. And that’s an exciting world to live in.

[1] Bad bosses and clients aren’t something you can control or change – it’s like being in a bad romantic relationship. You just need to get out of it. Luckily, once you understand the value you can bring, you’ll have a much easier time looking for new people to work with and finding people wo appreciate you.

How To Fund Your Coworking Space

One of the most common recurring questions that shows up in my inbox from prospective coworking space catalysts is rarely asked directly.

When people write in, if they’re looking for something specific, they’re almost always looking for business models, plans, pro-formas, etc. When I dig a bit beyond their request, it turns out that what they’re really interested in is figuring out how, or who, to fund their new operation.

We’re big proponents of bootstrapping at Indy Hall. Apart from industry cliches like, “It’s easier to spend somebody else’s money than it is to have to make your own”, there are very practical and pragmatic reasons for bootstrapping a coworking space.

At the top of that list of reasons is – because you can.

There are industries that exist where start-up costs are prohibitively high, and starting a new venture requires outside capital to get off the ground.

But coworking isn’t one of those businesses. Rather than needing intensive financial capital to get started, you get to start by building social capital.

Focus on Your First 10

People jumping straight into coworking calculating square footage & sizing up furniture, or obsessing over branding and their website, are skipping over the important and crucial step to developing a healthy community: finding your first 10 coworkers. Everything else can come after that.

Where you find them will vary. What they’ll look like will vary. But these first 10 people are the human seeds of your coworking space to be. They will be the #1 reason that other people want to come work with you at your coworking space.

Rather than inventing pro-formas or making complex decisions about your new business, you can turn directly to your first 10 and work with them to make decisions, and calculate actual financial viability.

But perhaps the most overlooked opportunity is:

your members are your funders.

Where Might Your First 10 Come From?

Our first Indpendents Hall member meetup in early 2007 was the first formal invitation for the people I’d been talking about coworking with to come together. We talked about coworking, but we didn’t exchange any money just yet (other than paying for our beers). There might’ve been 20 people at that first meetup, a number of whom I never saw again (or didn’t see until many months later).

Not wanting to lose momentum, we continued those meetups at least once a month. They sometimes involved direct discussions about a coworking space, but more often than not they were just opportunities for us to get to know each other. The prospective members got to bond with me, but also got to bond with each other. We also made it a point to attend other peoples’ events together. It might just be 2-4 people at a time, but we were starting to hang out more often.

We started our own “Jelly” casual coworking meetup every couple of weeks to work outside of the house together – sometimes from a cafe, sometimes a bar, sometimes just gathering in somebody else’s living room for the day. This was a crucial step past talking about the idea of coworking, and into the realm of introducing people to the act of coworking. These events grew from 6-8 people to 15-25 people over the course of a few months.

It turns out that working with people who aren’t your coworkers (in a traditional arrangement, anyway) is habit forming. People began to ask to do these meetups more often. And they continued to invite their friends.

On A Budget of $0.00

It wasn’t until this point that we started thinking about money, business plans, membership models, square footage, desks, or any of the things that people tend to be overwhelmed and concerned about. We spent at least 6 months spending ZERO dollars. And we’d built up a core group of around 10 people who’d formed deep, strong relationships with each other – all in the context of a coworking space that didn’t even exist yet.

And those people wanted nothing more than to have a place where they could get together as often as they wanted and invite more people over. The club was ready for a clubhouse.

On a budget of $0, we’d formed the very first stages of our working community. With no office, no infrastructure, no business license, no bank account.

Back To Funding

We opened our first budget with two funding sources:

  • my meager savings account (<$10,000, earned from web development consulting)
  • ★★★ membership dues, prepaid

Since we had this group of potential members who said they wanted coworking, we asked them to say it again – with their signature at the bottom of a check.  We ended up signing up 2 full time members, 4 lite members, and a whopping 23 basic members because of the time we’d spent building a strong core of 10 people BEFORE we needed the money.

We gave our “charter members” the opportunity to sign up for their preferred membership level for up to 6 months prepaid, with a bonus month of free membership for the prepaid memberships. We brought in another $4700, nearly 50% of my personal investment, before we’d even signed a lease. This was not only the funding needed to get the office opened – but it was the vote of confidence that I needed from the community to empty my personal savings into this venture.

Our Members Are Our Funders

Without members, Indy Hall has no reason to exist. Our members get to vote – with their dollars and their participation – if and how we continue to exist. It’s up to us to listen and learn from what they tell us.

Every minute you’re spending looking for funding is a minute you’re not looking for members.

Ask anybody who runs a coworking space today – they don’t need investors to grow and be sustainable as much as they need members.

Consider the Alternatives

Option one!

  1. Develop your business plan
  2. Find Investor(s) and convince them that coworking is the new hotness and they should invest
  3. Investor(s) buy in, and now own a piece of your hard work
  4. Find a location to open your coworking space in
  5. Move in. Build furniture. Paint walls. Install network.
  6. Grand opening! Celebrate!
  7. Celebration over! You need to find members!

Option two!

  1. Hunt for members
  2. Develop your business plan based on the members you’ve found
  3. Work with your membership to find a location to open your coworking space in
  4. Members buy in, now share a piece in the hard work
  5. Move in. Build Furniture. Paint Walls. Install Network. Together.
  6. Grand opening! Celebrate with your members!

Going the route of option one is a great route – if you’re into delaying the inevitable. No matter what, you’ll need to do the hard work of finding your members. In this case, you’re waiting to do that and asking somebody else to fund your stalling.

Option two, however, gets the hard part out of the way early and puts you in a remarkable position – most notably having member buy in – for your ongoing community development.

When you open your space at the end of option one, you open with a shitload of hard work (much harder than assembling Ikea furniture) ahead of you and a debt to an investor.

When you open at the end of option two, you open with revenue, momentum, and buy-in. Not to mention a lot of the hardest work behind you, complete ownership of your business, and the ability to answer to your community instead of an investor – because the community IS your investor.

So start with your first 10.

They’ll answer all of your hardest questions, including ones that are much harder than “How do I fund my coworking space”.

Starting Up

Joe Petrucci has taken a snapshot of the state of tech startups in Philly as this week’s feature on Flying Kite. He titles it an “underdog” story, an apt reference to a part of the Philly attitude that we know so well from our history.

I was a bit anxious prior to the release of this article, since I know I tend to be one of the few dissenting voices about “startups”, in Philly and in general. In the simplest of terms, I’m turned off by the common sense of privilege and entitlement in the media’s version of tech/startup communities, but worse, that people in those communities actually live like it’s true. I find it toxic, and don’t want anything to do with things that perpetuate that in Philadelphia. We deserve better.

To the contrary – I was quite pleased that this article was missing that tone, almost entirely. I enjoy the fact that it was headlined by a photo of four primary voices in the article who, while we have varied perspectives, are sitting around a table in the Indy Hall kitchen, smiling. The article reads with the honesty of a reality check without being too “up” or too “down”. My takeaway is, “things are changing, for the better, and ‘more of the same’ isn’t going to work anymore.”

That’s an attitude I can get behind.

Photo by Jeff Fusco

 

I also appreciated the strong overtones of “lets be a better Philly” instead of the usual “let’s be more like city X” that the media usually picks up on. In the Flying Kite piece, comparisons to other cities are limited to the fact that the growing pains Philly’s startup ecosystem are going to AREN’T unique to Philly – a fact which I believe to be completely true.

I believe that will be one of Philly’s biggest advantages over time, the thing that will help us outlast other cities: it’s ability to be itself, instead of trying to live up to being a competitor to Silicon Valley.

Some choice quotes:

“I think our identity should happen organically.” – Brad Oyler

“You need to have people at a common level that are comfortable with each other,” says McNeal of Startup Therapy, noting that as the area’s startup community has evolved, the need for more than basic happy-hour networking and base startup knowledge is evident.

Todd is talking about the need for Communities of Practice, rather than simply Communities of Interest. I expounded on this in Brian Glick’s recent blog post about Startup Therapy, with hopes of keeping them on the track to becoming a strong community of practice.


RJ Metrics, Cera says, is almost a “model citizen” in the local startup community.

I couldn’t agree more. The guys at RJ Metrics are sharp, motivated, and chose to be in Philly – moving into the city from Camden earlier this year. Among my favorite traits they exhibit that most other startups can’t seem to get – they’re quiet, except for when they have something meaningful to say.

RJ Metrics the kind of leading by example I want to see more of in the city I choose to call home. I’d take 100 more “RJ Metrics” type companies over a single “exit strategy” company making headlines anywhere in the nation.


Cera already has an idea for the startup community he is leading. “The best thing you can do is totally kick ass here.”

This is why I love Chris as a leader. He’s often reluctant, but he knows what he wants for the community he’s a part of.


I had a number of citations of my own quoted in the article, so I thought I’d share the Q&A I did over email with Petrucci for context and reference. Joe’s questions are in bold, my answers follow:

Q. What word(s) or phrase(s) would you use to describe Philly’s startup community?

I suppose that depends on which startup community you’re talking about. There isn’t just one.

There’s at least two styles of startup communities evolving in Philadelphia:

One version is a hyper connected community of interest, full of people who are passionate about the idea of startups but don’t have a lot of practical experience. They’re quick with rhetoric, read TechCrunch every day, and cheer whenever their “favorite startup” gets funded or acquired. I think this is more “scene” than “community”. This is endemic of most “startup” cultures you’ll find in cities across america, though. We’ve got one too, but that doesn’t make us special.

Another version is much smaller than the first. It’s populated by people who are in the early stages of building a business. That group is full of people sharing what they learn as they learn. They’re sharing practical experiences, problems and solutions. They recognize that Philly’s biggest missing asset isn’t funding, or talent, but a lack of mentors. They’re building communities of practice around early stage web-business creation to fill in that gap. If they’re lucky, they’ll become the future generation that Philly doesn’t have today, but that’s going to take some time. If this group pulls this off in a way that can last more than one generation, we’ll had a unique and valuable resource in our city.

At least one more version is much larger than the other two communities combined; mostly by nature of the fact that while it’s not self-aware enough to be a “community” by most measures, there’s an ecosystem of people starting new businesses in Philadelphia. They’re driven by pure entrepreneurship, the kind that doesn’t know any other option. These people are the most exciting to me because they’re both kinetic and potential energy. These people are building businesses because they want to, they need to, and they’ve either explicitly chosen to do it in Philly or they can’t think of a good reason to leave. They’re already in motion, not waiting for anybody. But there’s still potential energy because they haven’t yet realized that they aren’t alone.

Q. Do you still feel as strongly — like in your early July blog post “The funding ecosystem in Philadelphia: The empty can rattles the loudest” — that incentivizing startups coming/staying in Philly is not a good idea?

Its not so much that I think it’s a bad idea, it’s that I think we deserve better than the kinds of people/companies this attracts.

Q. What traits/practices have you found among Philly’s most successful bootstrappers?

  • “Philly”, as a brand or an attitude, is a part of why/how they do what they do
  • View constraints as benefits, not weaknesses
  • Honest/authentic expectations of themselves and others
  • They are unwilling to settle for status quo
  • They have strong mentors. They have at least one local mentor
  • They are involved in more than just the industry they are bootstrapping. Civic engagement, arts involvement, some creative endeavor.
  • They’re willing to let go of things, or transition them to new leadership.

Q. What supports are needed for those businesses and organizations in Philly that have already “proven their will to live against the odds … without begging”? Who should provide them?

My stock answer has always been: stay the fuck out of their way. I still think that’s the best answer.

The second best answer is to ask them. And don’t take their first answer as their only answer.

Q. How is what you’re working on contributing to the growth and/or potential of the Philadelphia-based startup community?

I think we’ve gotten to a point where we’re a both a place and a group of people that people can find comfort and support in trying to accomplish things on their own. We’ve never been a “services” business, we’re more like a community of practitioners where:

  1. You can learn about things you didn’t even know were possible.
  2. You can discover interests and skills you never knew you had.
  3. You can rest assured that you’re not alone, and there’s always somebody who’s done the thing you’re about to do. All you have to do is ask for help.
  4. You can be honest with yourself and the people around you.

The biggest thing for me, very personally, and I’m 100% certain that has led many people down a path of blazing their own trail is the comfort in knowing that you’re not alone in the way you think, the way you want to act, the things you want to do. Simply knowing that good, honest, hardworking people like you are doing this thing every day is inspiration enough for many people to leap into their own great unknown potential.

Let’s Go To Coworking School

When I’m talking to coworking spaces in trouble at least once a week, when as often as three times in three days I learn a about coworking communities struggling, I cannot help but think to myself

HEY FRIENDS, THERE’S A PROBLEM HERE.

[blackbirdpie url=”https://twitter.com/alexknowshtml/status/111863347271565312″]

I’ve written 97 – this post will be 98posts tagged “coworking” on this blog alone. I’ve posted nearly 1000 messages to the global coworking google group.

I’ve shared lessons. I’ve shared financials. I’ve shared stories. I’ve shared decisions. I’ve shared insights.

And yet, in spite of the supposed booming industry growth, coworking spaces are dying.

I’m not that special.

I believe strongly in the value, importance, and possibilities of coworking. So while I have any number of other things to do including continue to develop the community I call home here in Philadelphia, I’m also a firm believer in the notion that being successful alone isn’t the kind of successful I want to be.

Indy Hall isn’t an anomaly. Philadelphia isn’t an anomaly.

And I – most certainly – am not an anomaly.

I can teach you. I can help you.

I want your coworking community and space to be successful, and sustainable, like Indyhall is.

So I’m going to take a page out of Amy Hoy‘s book. I’m uniquely qualified to do so because I’ve guest written a chapter or two of that book, and helped edit a few others in the background. Amy is one of the most unique champions in her realm – the demystification of bootstrapping a product-business based empire. There’s many good reasons we’re friends. Among those reasons are that we know something great when we see it, and we simply can’t stop ourselves from helping other people out of their own way.

So after all I’ve given here and elsewhere for free, I haven’t got a moment of hesitation to shamelessly steal one of her greatest ideas.

I’m going to host a 3 hour virtual workshop where I’m going to share as much as I’ve learned about making coworking successful, healthy, and sustainable as any human being possibly can.

I’m going to give you a little more notice than Amy did, though. My coworking workshop is going to take place on Sunday, September 18th, starting at 1pm EST.

It just so happens to be my sister’s 22nd birthday, and there’s no better gift than the gift of education. She won’t mind if you’re buying it for yourself rather than her, I promise. 

$150 gets you 3 hours of workshop.

This is the three hours of workshop that can save you hundreds of hours of wasted time. Tens of thousands of dollars. And years of regret. I know, because I’ve carefully avoided wasting those hundreds of hours, tens of thousands of dollars, and years of regret that others are struggling to avoid..

Not without making mistakes. And I want to share those mistakes with you, too.

Want in? Tickets are for sale. Get your seat now.

Whatchu Talkin’ Bout, Willis?

We’re going to cover the core topics about coworking, in a few primary categories:

  • What “marketing” a coworking space looks like
  • An Intro to Community Dynamics
  • Business Foundations for Coworking
  • Operating a Coworking Space For the Long Haul

Inside the marketing segment, we’re going to talk about what marketing really is. Hint: it’s not advertising.

Inside the community dynamics segment, you’ll learn about some of the community models we’ve uncovered and explored. Find out what’s in your control – and what’s not – what you can do about it, and how it can make so many things in your life easier.

In the business foundations for coworking segment, you’ll find out the deep dark secrets to what has made the business side of Indy Hall successful. Okay they’re not so deep or dark, but they’re practical.

In the operations for the long haul segment, you’ll understand what it’s like to run a coworking space for 4+ years. The biggest challenges, as well as the biggest rewards.

Maybe you think you only need help with one topic. You’ll probably learn something in all four segments. 

Q&A is for the stuff I didn’t think of

I’ve got a lot of ground I want to cover in 3 hours, so I’m going to designate the last 30 minutes to Q&A.  I’ll open up for questions, text-chat-style, until we’re out of time.

Are you done giving free advice, Alex?

No. Far from it. I’m having a hard time giving advice that people don’t take even when they ask for it.

I want sharing my knowledge to make the biggest difference it can.

I’ve learned that putting even a small price tag on advice improves the likelihood that advice is heeded. If that means I need you to put some of YOUR cash on the line so that you’ll actually listen with both ears and an open mind, so be it.

So put your money where your mouth is. Let’s fix your coworking problems before they start.

Grab your tickets before Sunday, September 18th or before they sell out, whichever comes first.

Funding in Philadelphia – The Empty Can Rattles the Loudest

Yesterday I shared my opinion that professional & personal relationships – not jobs – are the key to student retention in Philadelphia.

Today, I want to address the notion that a lack of investment capital is a retention issue that needs to be fixed in Philadelphia.

Fact is, people are right. The funding ecosystem sucks can be challenging. But I don’t want it fixed.

Instead, I’d like to propose that the weak funding pool is actually one of our greatest assets in terms of portraying an attitude that will attract more of the doers that this city is known for.

I’m admittedly a bit biased in addressing this point, since I have a fairly vocal bias towards bootstrapping. I’m not alone in this stance; one of the most commonly cited proponents in the startup community are the guys from 37signals, with an entire series of profiles sharing the stories of $1MM+ companies that are bootstrapped and profitable. DHH has said it eloquently during his “Unlearn your MBA” talk at Stanford University:

When you’re spending other peoples’ money, you care much less about said money. When you’re spending your own money, you care very, very deeply about this.

So to reframe this discussion, I want to make it clear that I’m not against taking outside capital. Indy Hall took on a $30,000 personal loan to grow Indy Hall in 2009, and more recently have raised over $100,000 in equity to date towards the Indy Hall house construction project. In both cases, the funding can be viewed as growth capital.

But let me be clear – I’ve turned down easy money, too. You haven’t lived until somebody offers to write a check for $1MM and you say, “no thank you”. But in that moment, if you can remember what your true goal is, you’ll often realize that the person whose money you’re being offered isn’t there to accomplish the same goal as you and the “no” becomes much, much easier to live with than the alternative.

In every case where money was turned down, it was the result of introspection, and the realization the money wasn’t holding us back from executing the next logical step in our plan, and we should push forward until we were absolutely sure it was the limiting factor.

What I’m bothered by is the notion that the lack of of venture and angel capital is limiting the potential of Philadelphia’s early stage business community.

Plain and simple, that’s a lazy, bullshit excuse, and this city deserves a better attitude towards creating great things that people want.

And then I read articles like this one, about DreamIt Ventures partnering with Ben Franklin Technology Partners to offer post-DreamIt grads a fast-track to fund-matching investment. While a fairly creative solution – it’s a fund match up to $30k under the assumption that an angel leads the investment – we need to acknowledge that this is an unsustainable extrinsic motivator designed to keep talent that DreamIt has been unable to retain after the program.

I smell a mismatch of the intentions and execution to the realities of the offering.

If there’s a known lack of funding in the region, I’m unclear on how putting a small company that’s unable to support itself on financial life support is going to do anything other than keep a leash on that companies for another few months, only to lose them again.

Why are we trying to provide resources we don’t have to companies that think they need it when they can get it elsewhere?

Why not let them go elsewhere to get it?

Why aren’t we putting resources into improving the likelihood of keeping a company that doesn’t need angel money to survive?

Don’t worry Philly, you’re not the only city with this problem. You’re not that special. In fact, it’s got nothing to do with cities, or tech communities, or startups. This pattern isn’t unique to regional funding pools, the founders seeking, or the institutions providing them.

This pattern happens to people as freelancers, as they find themselves with a difficult or needy client who doesn’t pay full rate. They hold themselves back by feeling bad and continuing to support a needy client who “can’t afford to pay this month” rather than cutting that client loose to make room for the clients who know how to win.

This patterns to software product companies. A free-account customers  whines whines whines about how terrible things are, meanwhile they have other customers happy and paying. Growth is stunted when the company gives attention to the people who won’t ever pay regardless of how satisfied they are, instead of working with the customers who happily swipe a credit card every month.

The empty can rattles the loudest.

This old proverb recently shared to me by a friend and mentor, Weblinc co-founder Darren Hill says it best. Most people in Philadelphia don’t know about Weblinc, though it employs over 60 people and delivers a world-class e-commerce product that powers companies around the world. If you are active in the tech community, you probably know about Darren and his siblings’ other very successful business: National Mechanics.

My point is – both of Darren’s businesses are contributing far more to the technology and business ecosystem in Philadelphia than most of the “clanky cans” that we hear about in the news, and yet, very few people who consider themselves industry insiders even know they exist.

So before we point to a “lack of funding” as the issue that’s driving businesses we could have out of Philadelphia, why don’t we take a harder look at the existing successful companies we already have and see what they’re doing to make it.

A weak funding ecosystem aren’t holding anybody back. The could-be entrepreneurs who think they need funding in order to get started are. I’d rather they continue to leave when they feel Philadelphia is holding them back.

Like the needy client, the bitchy freemium customer, or any other empty can – I don’t want to be going out of our way to incentivize them to come to Philadelphia, or for that matter keep them here.

Instead, I’d like to see more efforts put into supporting the businesses and organizations who already have proven their will to live against the odds, and their ability to do so without begging.

That’s the type of attitude I’m continuing to find throughout the city and support. That’s the type of attitude that MY city deserves to be known for.

Why I decided not to speak at Innovation Philadelphia’s Global Creative Economy Convergence Summit

Kelly Lee, president and CEO of Innovation Philadelphia, invited me to sit on a panel at the summit about new alternatives to the “workplace”. While the topic is something I’m qualified in both knowledge and passion to represent, I’ve decided to decline participation with the conference.

The purpose and value of this event doesn’t align with the types of events I like to organize or the way I’ve structure the organizations I’m a part of. We approach things from a ground-up perspective and work as active participants in the community.

Our community takes a DIY approach and tends to bootstrap the passionate projects they work on.

I don’t think that this conference aligns with our community, or our approach to innovation. There is a lot of overhead and structure, which we feel inhibit innovation. The community that we are part of prefers to create, run, and attend events like Barcamp Philly, IgnitePhilly, and the Junto that are idea-based with lots of active community participation.

Geoff, myself, and every other leader in our community that’s stepped up over the last few years leads this community by example. Geoff and I feel that participating in and supporting this event that doesn’t match our goals or behaviors is not the kind of example we want to set.

The topic that I was asked to speak about, the evolution of the workplace, is one that I’m very interested in talking about and have published on and spoken about extensively. I wish the Global Creative Economy Convergence Summit were the right forum for the discussion, but I don’t feel it is.

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