A new wave of shared workplaces rolls through Silicon Beach
Pingpong tables, employees in sandals, software code scrawled on the walls, a bounce house in the lobby.
No, it’s not a Silicon Valley tech company. Rather, it’s a scene from one of several new tech-focused office buildings in Southern California where dozens of start-ups are setting up shop and sharing the work space.
In a unique feature of the region’s Silicon Beach, walls in more buildings are being knocked down to create open spaces where start-ups cohabit and employees mingle with one another, attend seminars and occasionally party.
“Being an entrepreneur is hard enough, and doing it from home or your buddy’s basement or from a Starbucks makes it even harder,” said Ronen Olshansky, co-founder and chief executive of Cross Campus, which opened in Santa Monica in October. Co-working spaces “grease the wheels of the entrepreneurial process tremendously.”
The shared office buildings are also drawing venture capitalists and angel investors who can drop by and, in one place, screen several start-ups for funding or give advice and guidance.
Although non-tech companies are also moving in, the unconventional offices — including Real Office Centers, Coloft, General Assembly, Blankspaces and Io/LA — have become especially popular among start-ups looking for built-in community and someone else to handle the headaches of finding real estate and setting up a work space.
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“Until you become a big company that has to keep secrets and has to have management, you don’t need to own your building or have your own space,” said Jason Crilly, co-founder and chief executive of mobile advertising start-up PageWoo. “It’s much better to have someone else handle the logistics, the cleaning, the electric bill, the Internet. We just focus on performing.”
So when PageWoo — after having gone through a start-up boot camp with accelerator program StartEngine last year — was looking for its first office, it opted to move into Real Office Centers, or ROC, a three-story, 44,000-square-foot building in Santa Monica formerly occupied by Google Inc. ROC also has locations in Newport Beach, San Diego and La Jolla, and is planning two locations in Los Angeles.
Decorated with oversized tufted leather sofas and neon patches of carpet, the Santa Monica space now has about 200 offices that can fit as many as 150 small companies, ROC founder and CEO Ron McElroy said. More than $4 million was spent to reconfigure the interior and install conference facilities, a kitchen, a coffee bar, furniture and other enticements for tenants.
“The office environment needs to be more than just four walls, a door and some glass,” McElroy said.
Unlike traditional shared office spaces, where workers from different companies use the same mailing address, receptionist and corner printer, the Silicon Beach co-working spaces are more like real-life social networks.
“It’s not like the executive suites. It’s not a stuffy place at all,” Crilly said. “It’s in the spirit of what Google had here. That’s what we love about it, that the vibe has continued on with just awesome people in technology who don’t care about convention.”
These days Crilly puts in 12- to 14-hour days at ROC, usually in jeans and sneakers. He breaks up his schedule with runs for takeout food for his eight-person team, pingpong matches or pickup basketball at a nearby park, and a beer or two from ROC’s kitchen. When he needs some fresh air, he goes up to the sprawling rooftop deck that overlooks downtown Santa Monica, where software developers bring their laptops and work on lounge chairs.
Having so many start-ups under the same roof has also lured potential investors.
TX Zhuo, managing partner of venture capital firm Karlin Ventures, recently began holding open office hours at ROC for entrepreneurs who want his advice on growing their companies and securing funding.
The Los Angeles chapter of angel investor group Tech Coast Angels also chose the co-working space as its new location for weekly sessions to screen deals or conduct due diligence on start-ups.
“It’s fun there. It does feel fraternity-like,” said Michael Green, president of the L.A. branch of Tech Coast Angels, which previously held its sessions at USC and UCLA. “You have built-in friends, a built-in network. When you need air you get up and there’s stuff there.”
But “you don’t see slackers” at shared workplaces because they breed creativity, said Jerome Chang, founder and architect of Blankspaces. The company has co-working offices in the Mid-Wilshire area and in Santa Monica, with a third location opening soon in downtown L.A.
“What’s so fundamentally different about a place like this versus working at a company’s office is no one works for each other,” Chang said. “The whole bureaucracy and politics and the environment of trying to vie for the attention of that one boss in the corner — that doesn’t exist. It’s just stripped away.”
Typically, collaborative spaces provide flexible plans by the hour, day, week or month and accept applications from businesses or individuals who want to set up shop there; some owners say they’re looking for members who are a good fit culturally. Fees are based on the space and amenities needed and range from large, fully furnished private offices to a spot at a communal table.
At the roughly 11,000-square-foot Cross Campus space, which now has more than 100 members, prices start at $150 a month for night and weekend access, which comes with a mailing address, meeting room use and discounts to classes and events. For $500 a month, members get a permanent desk 24/7, priority reservations to meeting rooms and events, and storage, among other amenities.
At ROC’s Santa Monica location, a spot at the work lounge goes for $200 to $300 a month. One-day access is $35, and a private office starts at slightly more than $1,000 a month.
Members say the perks and being around other developers have improved the quality of life for what can often be a lonely profession.
“You can become like an island if you’re just by yourself building your own company and not getting out,” said Dan Altmann, chief executive of Laffster, a humor discovery start-up headquartered at ROC. “So it’s the best of both worlds.”
