As a new startup entrepreneur, finding yourself on the verge of hiring staff members represents both a tremendous accomplishment and a new series of challenges. While it’s great that you’ve seen enough market and capitalization success to justify bringing on new talent, the fact remains that transitioning away from being a “one-man shop” carries with it certain responsibilities you won’t face while working on your own. Aside from the legal, taxation and HR challenges associated with hiring, one of the first bridges you’ll have to cross is simply deciding where to put your new employees. Even though you may not be ready to commit to a commercial real estate lease for three years or more, taking on a staff means that you’re responsible for desks, chairs and a roof over your new team members’ heads. Fortunately, commercial real estate isn’t your only option. In fact, there are plenty of alternatives to consider when it comes to housing your startup’s new staff:
1. Co-Working Spaces
Co-working spaces are open offices designed to allow freelancers, remote workers and startup entrepreneurs to collaborate together away from home. Think of them as a more business-oriented solution than working alone in a coffee shop. These types of offices, which are springing up in nearly all major cities, are incredibly affordable and operate on month-to-month membership fees. Depending on the offices in your area, your membership may include a dedicated desk, access to community conference rooms, office events and other perks. However, co-working offices do have some limitations. Given the community nature of these facilities, working together as a team may feel disruptive to the overall environment. Or, if your facilities are busy, you may not have access to conference rooms and other areas as often as you’d like. Despite these challenges, many new startups find co-working offices to be a good starting point when it comes to housing their growing companies.
2. Small Business Incubators
If you’ve outgrown your co-working space (or simply want to set up your own office from the start), contact your local government or nearby business development groups for information on any active small business incubator spaces in your area. The goal of most small business incubators is to provide flexible office space — in combination with services like mentorship — to growing startups. These programs typically offer discounted rents under the premise that doing so will stimulate additional business growth, resulting in a greater overall economic impact. These special rates and other entrepreneur-friendly terms may make incubator spaces a good fit for your growing company. Note that you might have to apply to get in. Of course, small business incubators aren’t available in all areas. Entrepreneurs in areas with incubators may also find that space rentals are limited to startups in particular industries. In addition, because the leasing arrangements with these programs are generally more restrictive than co-working office membership, you’ll want to be sure your startup’s revenue stream is steady enough to meet your lease commitments.
3. Executive Office Suites
One final option to consider, if you’re committed to the idea of leasing a standalone office for your startup, is the executive office suite. Owned and operated by companies like Regus and Intelligent Office, executive office suites provide the separate office space of a business incubator, but with a whole host of additional perks –- including administrative support, mail handling, high-tech utilities and more. In general, executive office suites are more expensive than small business incubators on a cost-per-square-foot basis. However, the availability of smaller office sizes and contract flexibility compared to incubators make this a potentially savvy office space choice for growing startups.
4. Remote Work Arrangements
Now, before you sign on the dotted line of any rental agreement, it’s a good idea to take some time to determine whether or not you actually need office space in the first place! There are plenty of tools on the market today that enable you to manage employees online – whether your staff members are located in the same city you are or thousands of miles away. As an example, using tools like Skype for office communications, Basecamp for project management and Salesforce for CRM info makes it entirely possible to manage a team of workers effectively from a remote location. Not only will setting up a remote work arrangement help to keep your costs down, it can also be a plus when recruiting talent. As a remote employer, you’ll be able to court employees from around the world — and those you make offers to may be more inclined to accept, given the desirable level of flexibility remote work entails. Obviously, there are plenty of different variables to consider when it comes to choosing the office space that’s right for your startup. But by thinking outside of the commercial real estate box, you should be able to find a solution that both saves you money and meets your organization’s unique needs.
The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.
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