office space
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How startups can make the open office work, for employers and employees
Alejandra Albarrán is ROOM’s Director of Design and Innovation, responsible for shaping the company’s iconic approach to creating products that make the open office open to more.
The open office plan was intended to help collaboration and productivity across employees and teams while better utilizing less square feet per person. But the results haven’t always proven to be very successful, based on years of analysis.
Yet it is still the norm for tech companies of all sizes, and will likely stay that way.
Based on my years of experience working with hundreds of companies, I’ll lay out a basic framework below to help you think through how to adapt an open-office situation to best meet your needs.
I’ll also walk you through the example of a growing venture-backed startup that’s staffing up in one of the tougher office markets in the world: Manhattan.
But first, take a look at the data. Studies have shown that open floor plans can inhibit productivity and health. Open office workers take 62% more sick days than those in private offices, and a mere three hours of steady noise can cause measurable distress and a decrease in motivation. Face-to-face communication has been observed to actually decrease in open plan environments, with a measurable negative impact on productivity.
Considering that 70% of Americans today work in an open office, the issue of constant noise and distraction is ubiquitous across the country. The result is a bad rap—one doesn’t need to look very far to find one of the many articles online criticizing the design.
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Should your company move into a co-working space, sublease space or traditional office?
Sam Einhorn
Contributor
Contributor
Sam Einhorn is a REBNY-award-nominated Director with the commercial real estate services firm Colliers International. He specializes in office leasing, renewals and expansion for high-growth technology companies. He can be reached at (212) 716-3679 or at sam.einhorn@colliers.com
It’s a cautionary tale we hear far too often: Company A, hiring staff and growing rapidly, finalized a 10-year lease for office space. One week after move-in they had filled their space to the brim, with engineers sitting on top of sales staff, interns working in the hallways and the CEO operating out of a small conference room.
Company A had backed themselves into a corner, in desperate need for more room with no easy solution to the problem, and looking to swiftly dispose of their inadequate space.
In the startup environment, everything moves at a breakneck pace. Raising venture capital, hiring staff, assembling a board, etc. – all while working day-in and day-out to refine a product or service meant to disrupt the world. With senior staff pulled in different directions, there is little time for a strategic analysis of office space needs.
My team at Colliers specializes in working with technology companies at all stages, from pre-seed to IPO and beyond. We have advised dozens of companies literally from their first day of operations, to others whose market caps are well into the multi-billion dollar range.
We have developed some metrics and strategies that help our clients to grow without having to worry about scheduling an hourly team huddle at the downstairs Starbucks .
We have extensive experience working with companies with offices around the U.S. and world, but a majority of our work is in the New York City area. The analytics and strategy formation for each company is different dependent on a multitude of factors: budget, concrete or tentative headcount projections, timing, etc. – but there are a few baseline rules that can help jumpstart the education process and conversation.
From working with hundreds of technology companies in various states of flux (capital infusion, rapid growth, headcount reduction), we’ve become experts on which office may be the best fit for a company, from a month-to-month WeWork licensing agreement to a long-term lease.
Rarely in the commercial real estate world are issues black-and-white; and strategies are unique to each company. But there are several basic questions that need to be answered when evaluating office space:
- When is co-working an effective solution? What are the pros and cons?
- What about a Sublease? When is that appropriate?
- When is it time to make a long-term commitment to traditional office space?
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On-demand workspace platform Breather taps new CEO
Breather’s new CEO Bryan Murphy / Breather Press Kit
Breather, the platform that provides on-demand private workspace, announced today that it has appointed Bryan Murphy as its new CEO.
Before joining Breather, Murphy was the founder and president of direct-to-consumer mattress startup, Tomorrow Sleep. Prior to Tomorrow Sleep, Murphy held posts as an advisor to investment firms and as an executive at eBay after the company acquired his previous company, WHI Solutions — an e-commerce platform for aftermarket auto parts — where Murphy was the co-founder and CEO.
Breather believes Murphy’s extensive background scaling e-commerce and SaaS platforms, as well as his experience working with incumbents across a number of traditional industries, can help it execute through its next stage of global growth.
Murphy is filling the vacancy left by co-founder and former CEO Julien Smith, who stepped down as chief executive this past September, just three months after the company completed its $45 million Series C round, which was led by Menlo Ventures and saw participation from RRE Ventures, Temasek Holdings, Ascendas-Singbridge and Caisse de Depot et Placement du Quebec.
In a past statement on his transition, Smith said: “As I reflect on my strengths and consider what it will take for the company to reach its full potential, I realize bringing on an executive with experience scaling a company through the next level of growth is the best thing for the business.”
Smith, who remains with the company as chairman of the board, believes Murphy more than fits the bill. “Bryan’s record of scaling brands in competitive markets makes him an ideal leader to support this momentum, and I’m excited to see where he takes us next,” Smith said.
In a conversation with TechCrunch, Murphy explained that Breather’s next growth phase will ultimately come down to its ability to continue the global expansion of its network of locations and partner landlords while striking the optimal balance between rental economics and employee utility, productivity and performance. With new spaces and ramped marketing efforts, Murphy and the company expect 2019 to be a big year for Breather — “I think this year, you’re going to start hearing a lot about Breather and it really being in a leadership role for the industry.”
Breather’s workspace at 900 Broadway in New York City is one of 500+ network locations accessible to users.
On Breather’s platform, users are currently able to access a network of more than 500 private workspaces across 10 major cities around the world, which can be booked as meeting space or short-term private office space.
Meeting spaces can be reserved for as little as two hours, while office space can be booked on a month-to-month basis, providing businesses with financial flexibility, private and more spacious alternatives to co-working options, and the ability to easily change offices as they grow. For landlords, Breather allows property owners to generate value from underutilized space by providing a turnkey digital booking system, as well as expertise in the short-term rental space.
Murphy explained to TechCrunch that part of what excited him most about his new role was his belief in Breather’s significant product-market fit and the immense addressable market that he sees for flexible workspaces longer-term. With limited penetration to date, Murphy feels the commercial office space industry is in just the third inning of significant transformation.
Murphy believes that long-term growth for Breather and other flexible space providers will be driven by a heightened focus on employee flexibility and wellness, a growing number of currently underserved companies whose needs fall between co-working and traditional direct leasing, and the need for landlords to support a wider variety of office space options as workforce demographics and behaviors shift.
Murphy believes that the ease, flexibility and unlocked value Breather provides puts the platform in a great position to win market share.
“Breather has built a remarkable commercial real estate e-commerce and services platform that offers one-click access to over 500 workspaces around the world,” said Murphy in a press release. “To our customers, having access to workspace that is turnkey, affordable, beautiful, productive and that can flex up and down based on needs is a total game changer.”
To date, Breather has served more than 500,000 customers and has raised more than $120 million in investment.
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Breather raises $40 million for stylish workspaces on-demand
A mobile app that lets users find and book stylish workspaces on-demand, Breather, raised a Series C round of $40 million. The funding brings Breather’s total capital raised to $73 million. Menlo Ventures led the round joined by Valar Ventures, RRE Ventures, Slow Ventures and Real Ventures. Menlo Ventures’ Managing Director Venky Ganesan told TechCrunch, in an e-mail, that… Read More
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