Brad Bowery is the former Chief Executive Officer of SRECTrade, a company that provides software to solar energy traders. He has recently become a partner of Founders Den, which is an innovative shared coworking office space helping other entrepreneurs take their companies to the next level.
1) Considering the economics of bootstrapping a startup, when does it make sense for a budding entrepreneur to consider moving their idea from their home (and/or coffee shop) and incurring the additional cost of a “coworking” space? More directly, how can an entrepreneur rationalize the return on investment?
I need to clarify that Founders Den is primarily composed of entrepreneurs who are introduced to the space through personal networks. They usually already have some sort of funding and money for office space. In my experience, they tend to be in a little bit different position than other founders who might be on the fence about taking office space. So companies that come through us are funded and have office space in their budget.
So to answer your question, let me take a step back and talk a little bit about my own personal experience. This type of decision is really going to depend on your respective circumstance. I bootstrapped my first company for the first two years, but I did this because I had the luxury of having a dedicated room in my apartment. I had a roommate who was never there and I had a lot of space. My environment was ideal. However, there came a point where more space made sense. I was also fortunate that my company had early cash flow. My decisions about what to invest in would have been different if we were burning cash.
In short, the return on investment in the context of your question is subjective. There are many things to consider: Is your living environment such that it can adequately support your entrepreneurial endeavor? Is using precious cash on renting working space the best investment, or could you get a better multiplier by investing in technology or more head count? Lastly, does the new workspace make sense for your company? Does the culture of the space match yours? There are a lot of choices regarding space, especially here in the Bay Area, will the environment help support your mission, culture, and values in ways that working somewhere else would not?
2) When an entrepreneur is considering picking a coworking environment vendor, what should she/he consider when making a decision about which space is the right “fit”?
This is an interesting question, because there is definitely a growing focus on the importance of one’s work environment. You have places like Facebook and Google that have made their campuses fun, and places that in a lot of respects are inviting. You are seeing people new to the workforce shy away from traditional work environments and levitate towards more dynamic ones.
At the Founders Den, we are really trying to create a curated experience for founders that come into our network. Our goal is to provide a lot of resources and a curated work environment for our entrepreneurs during a very crucial time of building their company. These entrepreneurs are able to cohort with a lot of other companies, all coming together, who are all going through similar challenges and feeding off of each other’s energy and skill sets. They also benefit from our network of advisers that include some of the top entrepreneurs in Silicon Valley. For Founders Den, it is really about a community. There are benefits that go beyond a standard coworking space.
There is a fairly large spectrum of choices for startups. Like most decisions, you will make the best choice by shopping your options and weighing costs against the value you will get. Cost is not just money, there is opportunity cost if the “fit” isn’t right, if there is dissidence between the culture of the company you are creating and the culture of the space in which you are doing it, you could be wasting energy. A bad decision is not without consequence, this new space is likely where you are building your company’s foundation (i.e. new hires, social norms, etc.).
3) There are possible pros and cons to a “coworking” space. For instance – potentially on the negative side – there are the inherent risks of distraction in a collaborative work environment. On the positive side, these type of arrangements are meant to be temporary so this type of engagement might provide motivation for a desired amount of growth by a certain period of time. What strategies can you recommend for someone to make the most out of their experience using a “coworking” space?
Let my start by clarifying that this comes from my own experience, but I believe there is certainly this idea that all the founders in Silicon Valley are networking all the time, and partying, and that’s all they’re doing. The reality is the people who are successfully building companies are going through a completely smothering experience. When you are building a company, you are living and breathing it. As a startup, it’s so easy to just put your head down, put the blinders on, and wait for months before coming up for air. That is something I experienced with my business. In my opinion, some healthy distraction is probably a good thing. In my experience, if I can get out of the weeds and sit and talk with someone smart it starts to trigger things in my mind that relate back to my business. It’s a great time to step back and look at the bigger picture. Since we are selective about the entrepreneurs invited to the Founders Den, I’m not worried that our entrepreneurs will have a problem putting their head down and getting work done. I worry they might not take full advantage of the opportunities to interact with other people, to sit in on talks, and take advantage of other resources that they can get in a well-designed coworking space. There are easy ways out there to get a desk, computer, and phone. In that sense, I guess one of the negative aspects would be that you could over pay for simple amenities by overpaying at a sophisticated work space (if you are not going to take advantage of all they offer when all you wanted was a phone).
So continuing along with the same theme, the upside is you are probably surrounded by a bunch of high performing entrepreneurs. I believe the great entrepreneurs will never have trouble focusing on their businesses, getting them to come up for air and refreshing the perspective from which they are thinking about their business is what we are challenging them to do. That is where a coworking environment can really be a benefit. You have the opportunity to cohort with other really smart people sharing the same journey but with different skill sets. You are surrounded by people that potentially see the world differently than you, as well as access to unique resources only available to the collective. Our entrepreneurs generally are accommodated for six months because we want them to get in, take advantage of the resources at a unique time in their growth and then graduate on to bigger things. It also helps us create an environment that is dynamic and constantly being updated with new faces and perspectives.
4) Moving to you personally: regarding Dunbar’s number, in my experience you are the exception that proves the rule. Your innate ability to stay connected to a large and diverse body of friends and associates, while still maintaining a high degree of authenticity is extraordinary. Given there are only so many hours in the day, what strategies do you use to maintain meaningful relationships with so many people?
I am a firm believer that you get what you give, and that is what has worked really well for me. I try to take the lead by being authentic and vulnerable when getting to know people… even if I’ve just met them. I lay my cards on the table early and often and, in turn, I have found it gets easier for others to reciprocate. I don’t create a high bar for getting to know me personally and it has helped me feel connected to people in a short period of time. Personal disclosure and trust is important to deeper relationships, and I suppose the way I communicate speeds up this process. This inherent style is not without its drawbacks. Put me in a networking event with a bunch of strangers and I’ll struggle not because of social anxiety, but because everyone there has been socially conditioned for small talk. It’s tough to really connect with someone in that environment. I like situations where you can have deeper conversations with people and move very quick past small talk and get into substance quickly.
I really do enjoy making connections and staying connected, and there are few things I do that probably help me feel connected to friends who I may not get to see as often anymore. For instance, I love taking photos. I’ve had a blessed life and I’m constantly documenting it so that I never forget it! I love going through old photos and will often come across a gem that I just can’t help but send to someone. It’s quite spontaneous and it always leads to some good back and forth. Those shared experiences will never go away, even if the new ones are fewer and farther in between.
Lastly, I love bringing people together. I’ve thrown some fun parties in the city, co-hosted a few charity formals, organized a few kitesurfing trips and co-hosted a couple huge Rose Bowl tailgates in Pasadena. People tell me I should be an event planner, but I could never do that for a living. It just wouldn’t be fun anymore if I were doing it for money. I love creating great situations that bring all the wonderful people I know, and the ones they know, together in meaningful ways. And there is nothing better than seeing people who are good friends, colleagues or even married because they met at something I put together. I have been to at least three weddings where I played a role in making the connection. How cool is that? Aside from being fun and rewarding, creating events is simply a great way to scale keeping in touch. There are no expectations and there is no hidden reason to why I like doing it, but there is no denying that it is a scalable way to stay connected to old friends and meet new people (within your network).
5) Men’s Fitness had an article earlier this year titled Silicon Valley’s New Social Network and the first line goes, “It’s an open secret in the technology industry: If you want to score a deal, learn to kiteboard.” The overarching theme was that deal-making is moving out of the country club and traditional office spaces and has become more adventurous and accessible. Knowing you are an avid kite-boarder, and in line with the theme of this interview, do you see the way entrepreneurs succeed at building businesses changing? Similar to the way open technology is being touted as creating a “Cambrian moment”, do you think the way we are accessing each other is a trend, or alternatively a paradigm shift that is forever changing the way startups will be built moving forward?
I think few would argue it’s a little easier to get an idea off the ground and get a company started than it has been in the past. I am not sure I would make the same assertion about later stage funding/financing, but I don’t believe that addresses the spirit of your question anyway. Also, I have heard things like, “kitesurfing is the new golf.” I’m not sure that is true. Are there more avenues to make connections and get things done through crowd-sourcing, coworking environments, meet-ups, events, etc.? Yes.
Focusing on kiteboarding is a red herring. Yes, it has some visibility right now in the Bay Area. However, for an entrepreneur looking to make connections, just getting to know new people through common interests is more important than getting involved in the latest fad. I got my business school internship through my involvement with pole vaulting. It was an awesome internship. I traveled around the world and got to do some really cool stuff working for an investment fund. I successfully partnered with someone to start my first company through a softball league. My Founders Den involvement did come through kiteboarding where I met Michael Levit during a summer kiteboarding trip I organize each year. Are the ways startups are being built changing? Yes. Are the ways we are accessing each other changing? Maybe. However, putting yourself out there and developing relationships through common interests is timeless, the popularity of certain activities just changes from time to time.