140. Flip Howard shares How to Write your own Playbook in a Crowded Market
Resources Mentioned in this Podcast:
Everything Coworking Featured Resources:
Masterclass: 3 Behind-the-Scenes Secrets to Opening a Coworking Space
Creative Coworking Partnerships: How to negotiate and structure management agreements from the landlord and operator perspective
Transcription
140. Flip Howard shares How to Write your own Playbook in a Crowded Market
00:00:01 Welcome to the everything Coworking podcast, where you learn what you need to know about how the world wants to work. And now, your host, co working space owner and trend expert Jamie Russo way. Welcome to the everything. Coworking Podcast, This is Jamie Russo. This episode is brought to you by my program, the Coworking Startup School. I have not reopened it since November. It is opening the first week in March. So if you are working on opening the co working space this year, this program is for you.
00:00:39 Please do not embark on this journey alone. You will make mistakes and be lonely and neither of those air necessary. This program is for you. If you are investing in your co working space and want to avoid costly mistakes and stress by getting expert and peer support in a highly facilitated environment, we want to make sure you create the right space for you and your target market right from the beginning. And we want to make sure you get the business model, right? So that you're set up for financial sustainability that matches your goals.
00:01:12 So we will help you with your pro forma your product. mix designed sourcing furniture, working with vendors, getting your marketing systems down, hiring the right team or learning to run the space yourself and getting set up with the right tech and more. You can absolutely piece a lot of this support together from the podcast and the everything Coworking Facebook group. But this program is for people that want to invest in access to a package that provides the information resource is and support that you need when you need it, and in the order that you need it accompanied by individual access to me and other industry experts.
00:01:48 If this sounds like a fit for you, make sure that you get on the Notify me list at www dot co working startup school dot com. Today's guest is Flip Howard of Work Sweets founder and CEO of Work Sweets Flip operates 21 locations throughout the Dallas Fort Worth and Houston area. I met Flip a couple of years ago. He gets into this, but he was out of the business for a few years and back into it and like he means business, he has rebranded and evolved the business and added several new locations over the last couple of years,
00:02:25 they are on fire. So we talk about the history of flips business, how he got into it and now with 21 locations, what that looks like for his team, how his team functions, how he manages his team across 21 locations. We talked about his virtual male business and what that means to his overall revenue. We talked about his go to market approach in Dallas, which is exploding with flexible office providers, and we talk about who he serves and some of the decisions that he makes that are specific to his brand and who is serving.
00:03:03 So without further ado, please enjoy my conversation with Flip. I am here today with Flip Howard, who is besides one of the coolest guys I know, as we were discussing on his intro. The founder and CEO of Work, Sweets and Work Sweets is up to 21 locations throughout Dallas Fort Worth and Houston. Flip, you have been on a growth chair, but you've been doing this for a long time. I know the stories. I've heard it on a ski lift before, but for the listeners,
00:03:37 tell us how you got into the business. And when? When did your first location open? What year? Sure hand. We started in early 2001. So gosh, almost 20 years ago now and it started, we were actually a tenant oven executive suite from another business venture. I started right out of college. I started a pickup and delivery laundry and dry cleaning service for college campuses. Anyway, we had our little corporate office there in and kind of old school. Executive suite on the lady was who owned it was struggling and not to go out of business,
00:04:06 that we bought her business for next to nothing and filled it up and then decided, Well, we like that better than the laundry business. And we sold the London business and just kind of bought more and more of those. We had the 1st 1 No. One and then one more no to war No. Three and just kind of added him one of the time through. We grew from one location to, and we were called Meridian Business centers at the time, liquor from one location to 15 between think 2000 won in 2000 and nine,
00:04:34 and then we kind of had a I was in a business partnership that ended up not going so well. And so from 2009 to 2017 we kind of just coasted. And we didn't really do anything new or exciting with our business. And we just sort of maintain same number, location, same size, same everything without really putting any new effort into it. And then beginning of 2018 January of 18 2002 years ago, I bought the other half of the business from my business partner and have since been kind of reinventing the way we do everything because we were and 10 years behind on just the way the way we operate it.
00:05:13 And that's that was why we changed our name from Meridian Business centers to work sweets as well as a lot of other things about the way we operate it. Yes, you're back in two years ago and decided to rebrand your team. You just mentioned that you're doing kind of, Ah, an off site for your team, with a few people who have been with you for over 10 years. How many people do you have that have been with you for that long. I think there are a total of eight of us that have been with the group more than 10 years.
00:05:40 Like I said when I was, we have about 65 or 70 employees total. But I got a good core group of kind of lifers who really helping. Like I said for that nine year phase where we kind of won't do anything because of some partnership dysfunction, we weren't really doing anything new with the business. It was just kind of running, and I was sort of had a lot of other things going on and was in that core group kind of ran the company for us for a while, which is great,
00:06:04 but it's been a lot of fun, but a kind of a different. It's been a interesting transition last two years because that group that was used to just sort of running everything status quo, now all of a sudden flips getting all excited about this idea and that idea and reinventing the way we do everything you know, from our names or product menu to our website or pricing to our policies, everything because, you know, in the years between 2010 and 2000 and 19. The whole Coworking thing came up and change the game.
00:06:33 Yeah, I really feel like there's a lot that you know, there were two buckets. There was old executive suites in the new co working things. And obviously most people now see those two things blurring and all the old executive suite they're offering co working now on all the co working places. They're making most of the money off. Private offices line between those two things blurring, but there's still a you know, people generally tend to come at it from one direction or the other, either the Coworking angle or the executive tangle,
00:07:01 and I think both really have a lot to learn from each other. And so we were in the bucket of Executive Suite company, trying to learn some of the best practices from what the Coworking movement had done with trying to retain. You know, the good parts of what we'd always done, and how you piece that together is is interesting. I I feel like I've seen a lot of companies who didn't have the partnership issue that I had still, in 2018 or 19 or 20 doing things exactly like they did it 20 years ago.
00:07:28 And I, you know, I don't think so. Yeah, I mean, I think, Well, that's kind of your personality to see the opportunity, I think, But to come in and to re energize the business. So what was behind the rebranding? Well, two things. One our old name. Meridian business centers. I didn't count the number of syllables, but it's a lot of syllables that doesn't really describe anything about what we do. That the term business center was determined the late nineties and earlytwo thousands that were the industry is trying to get stick,
00:07:57 and it just never did. No one referred to our industries business centers. Really, it was executive suites are serviced offices or it was office suite. There's always superior things. And so Meridian Business Centers was just a name that was kind of 20 years ago. It was also just associated with a very traditional executive suites, mindset and way of doing business, and we thought it would be a really good thing, too. While we're reinventing everything while we're, you know, offering all new products and changing all of our policies and how we handle clients and looking at things in a more customer service in community focused way to come up with a new,
00:08:31 shorter name that really reflected that clean look clean brand. And also something that one thing I really like about our name work sweets is we're on the right now.
00:08:43 I think there's seven or eight buildings that are names at the top of the building. What's real clear?
00:08:47 Just with those eight letters or many letters? That is exactly what we do. Yeah. Yeah, that's real nice for us.
00:08:52 We don't have to have. Are you? Are l up there on our phone? Number of everybody understands what works.
00:08:56 Well, I can't believe it was available. Yeah, I No. Yeah. It's a great name.
00:09:01 Yeah. Yeah, it is great. I'm sure you know that was I bought it maybe 23 years ago.
00:09:06 Now, Okay. I'm sure if I hadn't, someone else would have by now for sure. So rebranding is a major undertaking without kind of really diving into it.
00:09:14 Are there a couple of pieces of advice that you'd give to somebody thinking about going through that process? I mean,
00:09:20 you had to rebrand a dozen locations or more. Yeah, I would say it is really hard, and you can try all you want to think of all the areas that you need to touch with your new brand,
00:09:31 and you won't think of all of them and you'll mess stuff up and it will be harder than you think.
00:09:36 But even more worth it than you think. I think it is really been a shot in the arm and energized our whole company.
00:09:42 I was really surprised because I've been around for 20 years and in Dallas with 15 locations, 13 of men Dallas.
00:09:48 And so I had thought that the Meridian business centers brand and Dallas had a lot of sort of brand equity,
00:09:55 and people have heard of it for sure. But I was surprised how quickly the work sweet thing caught on,
00:10:00 and it really gave us a good chance to tell our story of how we're different and how we view ourselves kind of halfway between the we work style of shared workspace and the Regis style of Should Works mess.
00:10:12 Where is our old product? The Old Meridian business centers was pretty much just a, you know, kind of a copycat of a Regis style.
00:10:18 Yeah, three more upside, then risk in the name change for sure. And I was real worried about the FBO implications,
00:10:25 too, because we have a 20 year history already in business centers dot com. And you know, how badly was that gonna hurt us for our Google rankings?
00:10:33 And it hurt a little bit for a short time, 2 to 3 months. You know, we dropped a little bit,
00:10:37 but then found our way back up. So that was not as bad of, ah hitters as expecting also.
00:10:42 So how have you since you have the chance to rebrand and develop new spaces? Talk about to the evolution of your product offering and who you're serving.
00:10:52 Has that changed, or has it been more of a facelift? I would say that the core target,
00:10:58 you know, like anybody in this business when you try to define who your target market is, But then you say it and then you walk around the space.
00:11:04 You see a whole bunch of the exception just really cool. But I would say our target market, our bread and butter,
00:11:10 hasn't changed at all. We're still focused primarily on people looking for private offices, people looking to have their clients come into the office and people looking for a more professional atmosphere similar to the path you know of like a Regis style thing but without just the dark,
00:11:28 depressing hallway full of door. So from the co working side of things, we tried to get a lot more natural light in music community,
00:11:35 larger common areas and smaller offices Maur up to date designs and colors, and it's lighter and brighter. And so from a design in sing sing your photos of your new spaces And there,
00:11:46 yeah, I'd love the color and exactly they look like what you're describing. Just kind of really bright,
00:11:52 welcoming, but still professional. Well, cool, Thanks. Yeah, I really feel like there's a lot of people playing in the space where there's,
00:11:59 you know, kind of towards that. We work into the spectrum and a lot of people playing in the space of the kind of the regis end of the spectrum,
00:12:05 and I feel like the middle part is kind of an under served in it. So that's what we're trying to fill from our look and feel a design of it,
00:12:12 but even, you know, it goes beyond just the physical design. I think that the co working movement brought about some really good changes in focus for the old executive suite.
00:12:23 Mindset was very real estate transactional, You know, the long agreements with a bunch of gotcha clauses and holdovers and people trapped in leases they didn't want to be trapped in and kind of bait and switch pricing things,
00:12:36 not transparent pricing. And Coworking was really good about saying, Look, people don't view this like a real estate transaction.
00:12:43 This is the retail transaction. Make it customer service focused and make it simple and just be straightforward. If someone doesn't want to be with you,
00:12:49 you know they can't be with you, right? And so then break up, Right? Exactly. And so we've been trying to for the last couple of years,
00:12:58 I think, finding a pretty good middle ground of howto try to bring some of the best practices that the co working offered and merge it into an old executive suite operation to modernize it.
00:13:09 And you know, it's hard. Sometimes there's certain ways you've always done something that you don't realize isn't a smart way to do it anymore until you are showing a better way.
00:13:18 That being said, I mean, I think there's a lot to be said for the fact that you've had a business that's been sustainable for 20 years.
00:13:26 Not that many people out there can say that, especially at the volume of locations that you have just given it really kind of fun,
00:13:32 unique position, of having this base of, you know, knowing how to run this business and then the opportunity to sort of,
00:13:39 you know, evolve it and reinvent it to be, you know, more current, but still kinda maintain those principles that have helped to be successful over the years.
00:13:48 Well, I was just gonna say, I've been talking about a lot of the ways in which old executive suite type companies can pick up some of the best practices of you know,
00:13:58 that Coworking kind of brought into the space. But the opposite is true as well. And look what you were just getting out there.
00:14:04 There's a lot about, you know, having to pay bills and, you know, put food on the table for 20 years that,
00:14:11 you know, obviously we've learned how to make this business. You know, we've been through two recessions,
00:14:17 you know? So there's a lot about how you design a space and how you pro form, and a lot of that the numbers and dollars and sense of it that you have to blend with the make it cool looking and fun to be in in order to make it.
00:14:28 Really? Yeah. And almost, you know, I was just talking Thio Don ball And we were talking about,
00:14:34 you know, sort of the challenge today of differentiating and, you know, how do you do that?
00:14:40 And we were saying, you know, there are some that will go the well, let's, you know,
00:14:44 spend more per square foot Like I'm sure that got tempting for you when you're doing an update on your design and you're working with a designer,
00:14:52 you know who knows what they show you first round. And there's a business model. You have to overlay on that and say,
00:14:58 Well, we have to draw a line right. You can't keep going for the sake of sort of looking cool.
00:15:03 And the business model just doesn't support it. Yeah, and especially for us. I know a lot of coworking companies get is the bulk of their business or the bulk of their revenue and about the heads in the door.
00:15:13 But the bulk of the revenue comes from corporate accounts, which tend to be less price incident. And maybe you can afford to be in the class eight buildings with 100 50 or $200 foot billed out.
00:15:22 That's not our model were 70% entrepreneurs and 30% corporate sonar came for our client mix. So we have to provide value or that particularly the entrepreneurs aren't gonna pay,
00:15:35 you know, double what they could otherwise pay just to have a little bit cooler looking space. So we kind of know,
00:15:41 I think you sometimes see some confusion with some service shared workspace operators where they're trying to kind of be all things to all people or they're trying to be this or that and not really have a clear idea.
00:15:52 Maybe not so much of your target market is, but what's your position is what your advantage, where you gonna stand like what,
00:15:58 are you gonna hold firm on what you're offering? I think especially new operator struggle with that you know,
00:16:04 you get the people who come in and ask for things that you don't do. And then you think,
00:16:08 Well, maybe we should do that because then that would be revenue I could get It's hard, right?
00:16:13 Right? Well, yeah. And it is hard for me to like you were talking about from the design perspective.
00:16:17 There's a lot of things I would love to do that. I just have to think about it. I say.
00:16:21 Okay, Well, if I did this, could I sell every office for X amount more? You know?
00:16:26 Probably not. And so, um, yeah, but there's a lot that I feel like, really understanding what you're niches.
00:16:34 And what's your competitive advantages for us? You know, we've got a few things that we feel like,
00:16:38 really differentiate us from our competitors, And everybody else has those, too, And, you know, if you just keep your eye on those and design it around it,
00:16:47 I think some of the fringe stuff you can kind of see Okay, You know, maybe I don't need that,
00:16:51 because does it really help me in this differentiation? Not. Then it's probably worth money. So, speaking of,
00:16:58 I'm curious about your take on the Dallas market in particular, and you continued to expand open new locations.
00:17:06 I mean, I talked to operators in Dallas who were just like, uh, you know, the city's growing like,
00:17:12 you know, gangbusters. And yet there's a lot of supply. What's your description of your perspective on?
00:17:18 You know what's happening and how do you How are you sort of continuing that growth. It sounds like you've got a pretty good understanding how Dallas works,
00:17:24 even though I know you're not from here. It is amazing how you know, we had a handful of competitors five years ago,
00:17:31 10 years ago, and now I feel like there's four new ones popping up every month, and the amount of supply around is just through the roof.
00:17:39 And yet, despite that, this is not just lip service. I really feel like that theme or competitors go in.
00:17:47 They actually each new one that goes in creates more demand than supply we, despite the fact that we have three times the amount of competitors we usedto have.
00:17:56 Locally, we're seeing four and five times as much, you know, total overall demand. We right now are doing more tours more deals were more occupied than we've ever been,
00:18:06 despite the fact that there's one on every corner now part of that. Maybe because, like I said,
00:18:12 I think our our niche is a little bit under served there in that middle slice between We aren't really competing directly.
00:18:20 We sort of indirectly compete with a lot of the more open, you know, all glass co working places and we sort of indirectly compete with a lot of the kind of more Regis style ones.
00:18:30 And you are. Our product is a little bit probably a more unique and that we're a little bit We have less direct,
00:18:37 direct competitors. But still I really believe that, you know, for years, biggest obstacle to people not doing business with us was not us losing a deal over Price took a direct competitor or something.
00:18:51 It was always just people not being aware of our overall, you know, a product of the availability of shared workspace.
00:18:58 And so we worked in the world, you know, we can say what we want about. We work in some of their struggles lately,
00:19:04 but you know, they really helped change the way the world looks at office space, and they really sort of lifted the boat for all of us.
00:19:11 I believe in. And I was there. We were next door to all of my buildings. Do you?
00:19:15 And are you more suburban focused versus I mean, do you have kind of a location strategy? We do have a location strategy.
00:19:24 It's interesting in Dallas when you think suburban. I know it's also right. It's a little different. It's not like suburban like,
00:19:31 okay, we avoid the big city and we go out to these little, you know, almost rural type place.
00:19:36 And it's not that all of our places there are, you know, plenty of shopping malls within a minute of it.
00:19:43 But we have avoided up in pronoun in both Dallas and Houston, the actual central business district of downtown.
00:19:50 Check. This is a little different in that, you know, the downtown market is primarily corporate, meaning that the people who would occupy coworking spaces in those downtown markets the person office ng there would not be the person paying the bills.
00:20:03 Most people who work for themselves don't want to drive into downtown parking of being downtown, so we haven't been in downtown's.
00:20:10 But we also haven't been out in the burbs either. Dallas is just a big market. It is funny I had when I bought the other half of the company two years ago.
00:20:17 We had 13 locations in Dallas, and I thought we could go to, you know, 15 to 20 before we definitely need to hit,
00:20:24 You know, start going into other cities. I know they think that number maybe 30 before we need around other cities,
00:20:29 because there's just so much we can put him. We've got three or four within just a few miles of each other and they're all full.
00:20:35 And I'm you know, every deal that I've signed. I wish I had more square footage there. Slip Life is good.
00:20:42 It is good. I wish I had more square footage there. But you know that Said it's been a,
00:20:48 um you know, this growth from the last. In the last two years, we've added six or seven new locations that are already open,
00:20:54 and we have three or four more in the works that are executed that are not yet open, and all that growth is very expensive.
00:21:01 Life is good, and my company is probably, you know, is profiting more money and may be worth more money than ever before.
00:21:07 But I personally have less than I've ever had before because having to sink so much back into, you know,
00:21:12 getting it going, it'll be worth it in the long run. So I'm curious about your team as you've grown over the last few years.
00:21:18 A I mean, I think it says a lot about your culture, the you know, number of lifers that you've retained.
00:21:24 And I'm sure that was a bit of ah to your point, kind of Ah, just a reawakening for them when you kind of got back into things.
00:21:31 And you're I can picture you sort of running around being the typical entrepreneur with lots of big plans of lots of things to do and lots of ideas.
00:21:39 And they're like, OK, hold up moves. So something's been there 10 years and we're good at rolling their eyes at me.
00:21:46 Okay? My bad ideas, but yeah, I think I know. I heard somebody say recently, like every entrepreneur needs a filter.
00:21:54 And I was listening to another podcast in the guy said he had this guy who was a white board.
00:21:59 And when he calls the guy, the guy says, Okay, I'll write it on the white board and in a week we'll come back.
00:22:05 If you still think it's a good idea, then we'll talk about it. But it's like the parking lot for all the ideas.
00:22:12 Just curious about how you manage your team across 21 locations. Do you have, like a central group that handles like marketing,
00:22:20 sales, accounting? You know what happens at the location level versus centrally? Yeah, well, so I guess backing up a second for just the overall.
00:22:30 You know, Team, I'm glad you asked about because, you know, the team is everything. I feel like I could take those eight or 10 gonna core people by my lifers,
00:22:39 I call him, and I feel like I could get out of this business and go get into any other business and be successful,
00:22:44 or you replace those eight or 10 with eight or 10 bad people and you could give me the most bulletproof business ever,
00:22:50 and it would fail. You know, it's all about having the right team. And I feel like I'm a big believer in just empowering finding people who are good at things and empowering them.
00:23:00 I I don't really feel like, and maybe other people are better at this than I am, but I don't really.
00:23:05 I've never had a lot of success managing grown adults into being something other than what they are right now.
00:23:12 So I view my role as a manager Maur and identifying core strengths and weaknesses and trying to match those up with job descriptions of people and then just turn him loose and letting them do what they're good at and not trying to,
00:23:25 you know, steer them too much. Yeah, and so a lot of those lifers that process happened a long time ago.
00:23:31 And so they've been in a role in which they're totally comfortable in their skin and totally fits them. So they're happy.
00:23:38 I'm also a believer in kind of like with customers. I feel like if I go to McDonald's today,
00:23:45 maybe a bad example gonna take away okay? Yeah, yeah, I'm glad that Chick fil A's there to give me some delicious chicken nuggets for $6 they're glad to get my $6.
00:23:56 It's a win win scenario, like we're both glad that the other exists, right? And I feel like the employee employer relationship needs to be the exact same.
00:24:04 You know, if I had a friend who owned another company, who I knew that one of my key life for employees would be their entire life situation,
00:24:12 be better working for that person. Then it's my moral obligation to make the introductory here. Yeah, right.
00:24:20 And, you know, luckily for all most, my best was that hasn't presented itself yet. But getting back to your specific question about,
00:24:28 you know, kind of remote management whose wares part of it ties into what I just said. You know,
00:24:32 you have to. We don't have ah, main corporate officer. Everybody's together. We're pretty spread out.
00:24:37 And so because of that, you have tohave you self starter type of people. I can't afford people who need to be watched over to make sure they're working.
00:24:45 You can't see all 21 location of employees at once. Right now, we do have, you know,
00:24:51 we have a an accounting team that always together we have an I T team. That's kind of separate.
00:24:55 We have. So it's the way our corporation we are sort of corporate structure is set up. We have community managers and community coordinators at the locations,
00:25:05 and then we have a sales team that is pretty spread out. That usually has a few locations per sales person.
00:25:12 We have an accounting department. It's all together in one area, and we have an I T department that's actually pretty spread out.
00:25:18 I have a marketing department. We have Facilities Department and believe it or not, I have two of my lifers.
00:25:24 One of them works for me running my facilities. But living in Colorado and my head of I T and Strategy lives in Austin,
00:25:34 and we don't have any locations in Austin. But they were just people whom I had enough history with to know that they could get the job done from wherever.
00:25:42 What does the facilities group do? So there's four of them in that group, and two of them are pretty much involved with model my current locations,
00:25:53 just handling various service orders and everything from make readies to small remodel jobs and just kind of keep. I feel like I'm always keeping the center's press.
00:26:04 There's never, you know, it never look the same at the end of the year. They did in the beginning,
00:26:07 even if you had that location for 20 years, there's always stuff you have to constantly updating the art of the conference rooms of the tables,
00:26:12 the chairs or that sort of stuff. A lot of that kind of stuff. But then two of the people on the facility team manages all of our build outs.
00:26:19 You know, we always have. Since we've been on this Grossberg, we have two or three locations at a time,
00:26:25 always being built out right now. So right now we're designing a really cool outdoor coworking work terrorist at one of our locations and finishing up the punch list from another one that just opened a couple of weeks ago.
00:26:36 And, you know, and everywhere in between, throughout the build process flip, I'm starting to wonder how you had time to sit on this interview with me.
00:26:43 You've gotta have a lot of guys. All those people, you know, one of these. Yeah.
00:26:49 Yeah. I feel like if there's a role that is recurring, that happens more than once. Then I need to find somebody to do it so that my only role is basically coming up with new ideas and meeting with those people about,
00:27:03 you know, some questions they have. But I try to not serve any ongoing role. Have you kind of in your the evolution of the brand?
00:27:12 Have you updated kind of how your team interacts with members and sort of what their role is? Yes.
00:27:19 Although we're really lagging behind on that. I feel like to be honest, the one of the first things I thought when we took over and beginning of 18 2 years ago that I really like the way a lot of co working places held events and had a real strong community.
00:27:35 And there was APs and they were digitally and, you know, physically connected in various ways throughout the locations.
00:27:42 And I envisioned. Okay, well, in a few months, you know we'll be just like that and we'll be kind of like a big,
00:27:46 happy family where everybody in here knows each other. And we just not progressed this far on that. I'd like to.
00:27:52 I feel like I would still like to see us throughout 2020. Make some great strides in that area with hosting events with having Maur member engagement in more of an active community.
00:28:01 We have one, and it's better than it used to be. But I still feel like some of the competitors that are kind of more towards that.
00:28:08 We worked our stuff to a much better of job of of that than we do. It's a cultural shift that's more of a competency,
00:28:14 I think, than people think, and yet it takes time. But it's the intentions there you'll get there.
00:28:22 Yeah, I think we will. I just It's all in all you know, one thing interesting with 15 locations,
00:28:28 and I thought of this thing is kind of like a little speed boat. We could quickly turn around and fix everything that was broken,
00:28:34 and I'm discovering it a little more on a battleship than I thought. And we're you know, we're two years in,
00:28:39 and I would say I still have half of the things I wanted to fix in the first six months Are still there.
00:28:44 Still on that list? Still? Yeah, well, we've also, but you didn't just you weren't on Lee.
00:28:49 Stopping and fixing you are also. I mean, you've redesigned your entire business in the last couple of years.
00:28:56 I know only so many hours in the day, even when you have a great time behind you. You know,
00:29:02 the whole pesky wife and seven kids. There's that. What is their age range Now? I have seven kids from my oldest 21 junior in college,
00:29:13 all the way down to in a year old. Okay, so for the moment, that's why I need to come to the office to get worked on.
00:29:19 Like in New York. It's no working. Yeah, sure. But you still have sports. Did you?
00:29:25 No games to go to you in school, stuff to go Thio. And it's Yeah, of course.
00:29:30 I'm coaching my high school daughter's tennis team right now. Oh, very nice. Okay, cool. So I'm curious,
00:29:37 because this is always a hot topic. So you don't to share your ah, all your secrets. But can you talk about how what percentage of your business is virtual mail?
00:29:47 Is it a key part of your business? I'm even doing this for a long time, so I suspect it's a fairly healthy component.
00:29:54 It's a huge deal. I wish I had the numbers. Yeah, I'd be happy to share. I know we do have I think we average between 100 and 200 virtual members per location?
00:30:04 Location? Yeah, I think the overall it's close to 20% 15 to 20% of our overall revenue. I'm not mistaken.
00:30:14 It's big, but it does take a long time. You know one thing we hadn't grown, add new locations in 10 years,
00:30:21 and when I was doing performance for new locations, I, you know, plugged in amounts for virtual office is kind of based on what I was looking at,
00:30:28 all my other locations, And that was one thing I really overshot on how quickly those come, because they just takes a while to build a book of virtual business.
00:30:39 A lot of them are people who used to office there who don't office there anymore. Just keep kind of virtual presence there.
00:30:45 That's one of the reasons, but it takes a while. It takes a many years to have a big,
00:30:51 big book of Virtual is, but it's huge. But that's another thing. I think a lot of co working places have wondered why they haven't gotten as many virtual members as they hear about some of these,
00:31:02 you know, kind of older style executive suites. And part of it is just the time factor that I just talked about.
00:31:08 But also there is a not all, but with a lot of virtual clients. There's an image there trying to convey,
00:31:15 and that image sometimes lines up better with kind of a more traditional conference rooms and reception deaths. Kind of a look.
00:31:24 And it does with kind of a hip coffee lounge, the look. And so I think a lot of the virtual clients are a little bit Maur old school and kind of what they're looking for,
00:31:34 which I think some co working places of our kind of finding out is not to their advantage. Well,
00:31:41 And I also think it's not just not understanding kind of howto build like you were just at Winterfest, which Divinci hosts.
00:31:47 Listing with all of the Legion providers is one of the ways to build the business. It's not all organic for sure.
00:31:55 Yeah, yeah, and it's harder because you can pay Google clicks for offices that'll make you thousands of dollars a year.
00:32:02 But if somebody's gonna give you $50 a month, there's only so much you're willing to pay for that lead well,
00:32:06 and you're competing with the Da Vinci's and the I post rolls and the folks who are paying Google for those clinics.
00:32:12 So living with them, this kind of the shortcut but to your point, builds for a long time.
00:32:17 I always just loved to ask people that I know have healthy businesses because I think it's aspirational for folks to know,
00:32:23 like, what's possible? And it just made your point. Everybody says it takes time. You need to be patient.
00:32:28 But if you're consistent and you leverage the Legion partners than it can build, and before you know it,
00:32:34 it'll be 20 years later. Here you are. Well, yeah, and the beautiful thing about virtual XYZ I mean,
00:32:40 let's just say hypothetically speaking there 15% of your revenue and you operate on a 20 to 25% profit margin.
00:32:49 That means there 3/4 of your profit. You know, if they went away, you would lose 3/4 of your profits and they take up no inventory.
00:32:56 And yeah, we're actually trying to find ways to increase our average. You know, over the last 20 years,
00:33:04 the average dollar per virtual office has gone down into that surprises me. Yeah, they just what you can charge.
00:33:12 Forum hasn't really gone up much because there's so many more competitors offering it. And there used to be a lot of people who are interested in the telephone answering the telephone service side of it.
00:33:21 So we have a lot of people buying 152 $100 month package, and now we have a lot charging,
00:33:26 you know, who were interested in the 50 to $75 package. That's primarily just mail stuff. And so we're trying to find ways to say,
00:33:34 you know what? The 2020 version of a virtual office package that maybe 100 $50 that people would be interested in.
00:33:42 So we're giving away a little kind of sampler size bits of co working time with it and things like that to try to find ways to give people more than just a mailbox.
00:33:51 And we actually are having some success with that and then also using a lot of the meeting room time.
00:33:57 So, you know, we're getting up using Coworking touchdown, death and meeting room, time to kind of make up for the loss of what we used to get from telephone revenue.
00:34:06 Yeah, I think that's a super interesting opportunity into your point. There's no mostly margin there. Certainly,
00:34:11 if you get heavy conference room users then that you know there's an opportunity cost there. But so what's next for work?
00:34:17 Sweets. Well, just keep growing. We're in Dallas and Houston. Now. We have four locations in Houston and I think 17 open in Dallas right now.
00:34:29 I think we'll probably get to 25 ish, 25 to 30 in Dallas and 10 to 12 ish in Houston before we go hit other cities.
00:34:40 And I think I could see us doing major market middle of the country cities. I like Denver in Atlanta and Phoenix and big cities like that.
00:34:48 All right, so the future is bright and you're back in it for the long haul. It's fun.
00:34:53 You know, our little Our slogan on our website says work is good. Where you do it matters because I really do believe that we kind of lose that as a culture like anyone talks about work in such a negative way.
00:35:04 And yet everybody knows, you know you don't really feel fully actualized if you're not doing some work, and I'm not saying we only be workaholics,
00:35:13 but, you know, work should be fun, and I just I think work itself is a really good thing.
00:35:18 And that's how it should be. Exactly. Thanks for taking the time today and for sharing your story in your perspective and congrats on your evolution and your growth.
00:35:28 We look forward to continuing to follow your journey. Absolutely thanks so much for having me. Thanks for joining us on this episode of everything co working.
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