July 12, 2013

Sharing offices works for Maine startups

More than a half-dozen co-working facilities have opened in Greater Portland since January 2011.

By J. Craig Anderson canderson@pressherald.com
Staff Writer

When Connie Pacillo and her two business partners formed a small marketing and design firm in December, they had an office dilemma.

click image to enlarge

Fozzie Mahal waits for a game of ball Thursday while J. Sandifer of Portland works for Tide Creative, a software startup, at Think Tank in Portland.

Jill Brady/Staff Photographer

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Employees of Cash Star, a Portland-based national company, brainstorm Thursday at Think Tank, a local business that rents office-style work space shared by freelancers and startups.

Jill Brady/Staff Photographer

Working out of living rooms and coffee shops can be noisy and distracting, but renting an office in Portland is prohibitively expensive for many startups.

Like hundreds of other entrepreneurs, freelancers and startups in the Portland area, they chose a third option that has emerged over the past few years: shared co-working space.

More than a half-dozen co-working facilities have opened in Greater Portland since January 2011, with the most recent arriving in Yarmouth in early July.

Co-working spaces are growing in popularity because they solve a common problem for small startups and independent contractors, experts said. They offer all the basic amenities of a corporate office at a much lower cost.

Pricing and services vary slightly, but in general, co-working spaces provide professional-looking offices where clients, often referred to as members, can stop in anytime to use a desk or a cubicle, Internet service, Wi-Fi, meeting space or other facilities.

"These spaces are tangible resources that firms can corral without having to spend big bucks," said John Voyer, professor of business administration at the University of Southern Maine. "They're taking a slice of it, rather than the whole thing."

For as little as $80 a month, a member gets a business address, a nice facility for meetings with customers and a place to work outside the home or coffee shop.

"So you're not sitting home in your jammies thinking, 'Should I watch Jerry Springer?'" said Pacillo, a partner in Creative Content Partners in Portland.

Creative Content is a member at Think Tank, which has two co-working spaces in Portland and one in Yarmouth.

Think Tank's owner, Patrick Roche, said he opened the company's first space, on Exchange Street, in January 2011, then a larger one on Congress Street in February 2012. The Yarmouth location opened in early July.

Roche said the idea was born out of his own desire to find a low-cost, collaborative work space in Portland after moving to Maine from Massachusetts in 2010.

"If this is what I wanted to do, I imagined other people would want to do it, too," he said.

Think Tank now has more than 100 members, who can access any of its three co-working facilities, Roche said.

Most co-working spaces offer several tiers of service, ranging from limited use of a shared desk to 24-hour use of a dedicated office within the facility.

The price for a "floating" member with no dedicated desk, cubicle or office starts around $80 a month. Members at the low end often have a limit on how many hours a week they can use the facility.

On the other end, members can rent their own dedicated offices. Creative Content has a 120-square-foot office at Think Tank, for which it pays $550 a month, Pacillo said.

Nationally, co-working spaces evolved out of a relatively recent phenomenon at larger companies: a move away from spacious, enclosed offices toward group-oriented, open "flex space" that can be used by any individual or team in the organization, said Bruce Jones, business development manager for Creative Office Pavilion, an office design firm in Portland.

"The way we do work has evolved to become a lot more collaborative now," Jones said.

Collaborative work spaces save companies money, he said, because they take up far fewer square feet than a suite of large offices.

"The major driving factor is the real estate end of things," Jones said. "Real estate is just getting so expensive."

Unlike business incubators, which offer startup firms structured, organized collaboration and mentorship in exchange for a stake in their future success, co-working spaces simply charge membership fees for use of their facilities, said Voyer, the USM professor.

Still, because they bring together a diverse group of professionals in a relatively open area, collaborative efforts tend to emerge spontaneously, said Elizabeth Trice, co-owner of Peloton Labs, a co-working space in Portland.

Most co-working spaces encourage interaction and collaboration among members by hosting social and networking events, seminars and other activities.

At Peloton Labs, members take a daily afternoon break together, Trice said. She also organizes at least one event per month for the roughly 75 members, such as a guest lecture or mixer.

Trice said she sees herself as a facilitator, not just a landlord. "It's more about hospitality than it is real estate," she said.

Casco Bay Technology Hub, another co-working space in Portland, targets high-tech startups, said manager Dave MacElhiney. It doesn't focus on floating members, he said, because it is set up primarily for those who want a dedicated office or a large, private cubicle.

Since opening in February, Casco Bay Technology Hub has rented out slightly more than half of its 23 offices and cubicles, MacElhiney said. The company charges as little as $350 a month for a dedicated space.

Most co-working spaces double as facilities that can be rented out for events, so owners can supplement their revenue on evenings and weekends, when relatively few members are working.

Casco Bay Technology Hub hosts its own monthly high-tech networking event, called Pub Hub, which is free and open to the public.

One drawback of owning a co-working space is that some members are bound to leave when they get big enough to buy or rent their own offices. MacElhiney said he will wish them well.

"I want them to succeed and move on," he said. 

J. Craig Anderson can be contacted at 791-6390 or at canderson@pressherald.com

Twitter: @jcraiganderson 

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