171. Josh Coffy: Buying Your Real Estate and Marketing Your Space

Resources Mentioned in this Podcast:

Everything Coworking Featured Resources:

TRANSCRIPTION

171. Josh Coffy: Buying Your Real Estate and Marketing Your Space

00:00:01 Welcome to the everything Coworking podcast, where you learn, You need to know about how the world wants to work. And now your host coworking space owner and trend expert. Jamie Russo, Welcome to the everything coworking podcast. This is your host. Jamie Russo today's guest is Josh Coffey. Josh was a student in my coworking startup school. So I got to know a little bit about Josh and his background and his coworking story.

00:00:45 Maybe a lot bit. We spend some time together on our Q and a calls. And Josh has a great Instagram account, which I will share later. So I wanted to share his experience with you. Josh lives in a town of about 20,000 near Columbus, Ohio, he and his wife, Kelsey, and their dog Maxwell bought a building downtown and launched a coworking business in it.

00:01:07 Josh shares with you, his experience buying and renovating a building. Why he decided that a coworking space was the best use for that building. And he shares the good and bad surprises that he encountered on his journey, which you can learn from and try to avoid. Josh is also in his day job, a professional marketer, and he spills the beans on how he's marketing his coworking space and share some tips that you are not going to want to miss.

00:01:39 Before I dive in, I have two opportunities. I want to share with you today. If you're working on opening a coworking space, I want to invite you to join me for my free masterclass three behind the scenes secrets to opening a coworking space. If you're working on starting a coworking space, I want to share three decisions that successful operators make when they're creating their coworking business.

00:02:02 This masterclass is totally free. It's about an hour, which includes Q and a time. If you'd like to join me, you can register at www dot everything, coworking.com forward slash a masterclass. If you already have a coworking space and you're starting to look ahead to 2021, and you're wondering how the heck to plan for such an unknown, we're going to tackle that together.

00:02:27 We will not have the same planning focus coming out of a global pandemic as we would in normal years, right? So I want to take you through a nine step approach to get ready to thrive in 2021, survive means to continue to live or exist, especially in spite of danger or hardship. And that's what we've been dealing with in 2020 thrive means to prosper,

00:02:53 be fortunate or successful or grow or develop vigorously to flourish. Now we can't predict what 2021 will mean for your business, but by planning in advance, how we will approach the year, we could be intentional and in control and find opportunities to grow and to thrive both personally and for our businesses. So I want to help you prepare for 20, 21 confidently so that you have both the mindset and the business that is ready to compete for incoming post COVID demand.

00:03:28 Many operators today are feeling uncertain, burned out, unsure of what to do next and not sure that you can survive. Many of you are scared, not feeling in control, maybe feeling unfocused stuck. If you feel even a little that way you are not alone, but those feelings are not good for you or for your business. So with an intentional plan for how you and your team will approach 2021,

00:03:57 you will feel happier, more positive, less stressed at work and at home. And you'll be prepared to focus on the right things and to see new opportunities. So if you'd like to design your business to thrive in 2021, please join me for our 2021 planning workshop. You can get more details at www dot everything. coworking.com forward slash thrive 2021. And now please enjoy my conversation with Josh coffee,

00:04:27 founder and CEO of flight media and coffee space coworking in Ashland, Ohio. It's a apropos that you took a sip of your coffee as I was about to introduce you. So I'm here today with Josh coffee on the podcast, and I'm streaming a preview into Facebook and I could talk to Josh for hours. So I decided to hit record and get started.

00:04:52 And I'm sure he doesn't have hours. So I'm tired of your time because you are a busy, a busy man. And I have a question related to your recent two week trip, but we're going to dive in, thank you so much for joining me today. So we're going to talk to Josh about a bunch of things today. One of them is owning a building and opening a coworking space and he runs another business,

00:05:17 has a wife and a dog and is a passionate CrossFit addict as I am. So of course we were just talking about CrossFit a little bit. So Josh, you are in Ashland, Ohio, correct? Yes. We're in the middle of nowhere, which is basically the only way to describe Ashland. So I love this because you had all these plans,

00:05:41 pre COVID, but I think this is one of, sort of the positive trends that's coming out of. COVID there's a big discussion in the Facebook group. I had this woman reach out to me. She's like, I'm in this little town in Texas and I'm kind of embarrassed, but I want to renovate a general store that her grandparents owned and she was feeling like,

00:06:00 no one else is doing this. And I don't even want to, you know, she wanted some resources for like small town coworking and she pops it in the Facebook group and all these people come out of the woodwork, you know, who are doing the same thing. She's like, I'm in like re it and now I can work from wherever. So I'm gonna go home,

00:06:17 you know? So tell us about you and your background and your, your coworking story. Yeah. So we are in Ashlynn, it's just North of Columbus by an hour. So it's not like it's like right near Columbus and there's 20,000 people in this town. I mean, it's not even a city. I'd call it a town. Although we do have a downtown,

00:06:39 which is where we're at. And so my primary business was not coworking. And I, so I own a marketing agency called flight media. And this year is our, or this month is actually our seventh year in business. So we're a marketing agency and I never intended personally to get into coworking. It just kind of happened by default, but what,

00:06:58 but after I started making a shift toward coworking, I do remember my first experience in coworking was about six years ago. I was in New York city. It's Christmas time hanging out with some friends that have a place there. And they're like, Oh, you need to come to our office. It's in a place called the primary. And I was like,

00:07:16 all right, cool. I don't know what that is. And I'm like, it's a coworking space. So we went in there and there's like yoga classes going on. And there's just all this open space and glass rooms and it's busy. And all the hustle bustle of New York city was happening. And that kind of amazed me. And I thought that that's the coolest thing ever.

00:07:32 I'm a super social guy. So that's when I first kind of experienced coworking. It was so long ago. And all I thought at the time was, man, somebody should do this in our town. I would totally move our offices like into this coworking space. Cause it's so cool. Like the idea of bringing people together. It's just that, that's what gets me excited.

00:07:52 Like the revenues, like that's cool as a real estate investment. It's fantastic. It's way more profitable than longterm tenants, but the people are kind of what excited me about it. And so I remember thinking people should do this. You should do it. I know. Well, and that was six years ago. And then when we got back from New York city,

00:08:11 we're actually going in, it was December and going into the next year, my wife and I were signing for our agency where we're growing, our agency was growing, we had more staff and we needed a bigger space. So we ended up moving in downtown and signing a four year lease on like a 4,000 square foot, second floor building, which is actually the building that I'm in right now.

00:08:31 And it was way too big for us at the time. And I didn't think about coworking whatsoever. And I am however, a huge financial nerd. Like I read books on real estate and investing and I've been doing this since I was like 17. I was that kid in like a, in junior era, a junior in high school, it was like study hall.

00:08:48 I'm like studying stocks, I'm investing in Scott trait or a TD Ameritrade. I'm like buying and shorting Netflix. So I'm like a finance nerd. And when we rented this place, I was like, you know what, I'm going to negotiate the ability to sublet. So if we don't have the space, we'll just rent out what we don't use. And I didn't even think about it at the time.

00:09:06 And so we coworked here for like, not officially, not intentional law kind of intentionally, but we coworked for, for, well, actually since the last four years, I mean, immediately, what was crazy was we came in, we renovated this, you could see, we have bright colors, you know, we're an agency. So we're like,

00:09:23 Oh, we're gonna make like Facebook and bean bag chairs that nobody sits in and we're going to put up a library and ping pong tables and all that stuff. And so, yeah, It's really good coffee because Josh coffee loves coffee. That's very true. I can tell you about that later, but I, yeah, so we moved in here and then as soon as we had our grand opening,

00:09:44 we did a ribbon cutting and there was like a hundred people that came to this. I just wanted to see what's going on downtown. And when they came in to see our business from literally that day, I had people hand me business cards, people saying, Hey, if you ever want to rent space up here, just let me know. I would love to move one of my offices in here.

00:09:59 I would look like chiropractors attorneys, just so many photographers. So many people wanted to get in. And that's when I realized it's Hey, this is actually great. So within the first year we were covering all of our lease and utilities and internet and all of that stuff. And then our agent, she was living here for free. And so that kind of gave that kind of peaked my head.

00:10:19 And you weren't calling it coworking. You were just like covering expenses and having your, you know, your friends come in because yeah, Yeah, I was gonna say, so we had, and we still have the most passive form of coworking command. We didn't even have a community manager. Like we don't have a community manager. It's a great example because there are others in your boat thinking about that.

00:10:40 It's like, look, you don't have to hire staff all the time. You have to be in a position like Josh, where you know, the whole town. So it's easy, it's easy to attract people. And you've already got a really nice space. So it mean it worked for you. Yeah. Well, and it was like when we started doing it and that's the thing,

00:10:58 like if anyone's listening or watching this and saying, Oh, well, I don't know if I could just out the Gates and, you know, invest in a 30 to

$40,000 a year, community manager and whatnot. Like don't, you know, one thing I remember, I'm a huge office fanatic. I love the office. I've seen it nine times now we just finished a nighttime.

00:11:14 I could quote every scene, every line, like almost everything. And I remember this one time when in the office, the Angelo hurts himself and he's not able and there's no office manager. And then it's interviewing Jim Halpert and John Krasinski. And he looks at the camera and says, you know what? We haven't had a manager in three weeks. Turns out,

00:11:33 even if there's no manager, people still come in and get their stuff done and leave. And I remember watching that and that's literally how it feels here. It's literally like the oddest people come in, they do their own thing. We don't have all the crazy bells and whistles. Like we're not doing tons of events. We're not doing a lot of that stuff.

00:11:50 And so we had that model for four years and I'll tell you though, I still never thought of it as coworking space. I was like, yeah, we just rent this out until two years ago, I actually had a coworking. I don't know if I ever told you this. I had a coworking company from Cleveland approach me. They already signed a deal or they got it.

00:12:07 Ashton university, which is our huge private university here in on it. They got the mayor and the city in on it. And they actually wanted to take over our space and they wanted to basically take it over as the coworking space that we would then rent from, in sign our lease over to them. They wanted to basically take over because our mayor had been in here.

00:12:28 A lot of people from the universities and a lot of people have been through our building just because we have people here. And we work with a lot of them are agencies in here do. And so people had seen it and they pitched it to this company to say, Hey, come down and talk to this flight media company. See if you could take over this space and build a coworking,

00:12:43 cause it'll help our economy thrive downtown and grow. So they had all this funding. They had like $50,000 in renovation funding. And they said, listen, if you just sign this over to us, you guys are just rent from us. We'll do a $50,000 renovation. The university's paying for the city's in on it. We have grants and all this stuff.

00:12:58 And then I was like, okay, I have something here. If you guys are coming down from Cleveland and, and you want to take this over, I think that I have something here. So the mayor, they like invited me to the mayor's office and I'm meeting with all these people and they're all just pushing me to do it. And I'm like,

00:13:14 you know what? I'm like that guy that if you, I like a challenge. So if someone's like, you know, you, you know, you don't have the resources to do this. You know, we do. And that's what we're gonna bring to the table. We have the systems and the operations. And so I was like, in all due respect,

00:13:28 I'm going to do that. And so they were like, no. And so anyway, I turned down, all the money, turned down everything, and I said, we're just going to do it ourselves. And so we ended up doing it and it has worked. It has worked really, really well. But, but the thing that actually that started it,

00:13:43 and two years ago, I was looking out this window right here, across the street. And there's a building. That's just, Oh my gosh, it was awful. So like the front of it, there was no facade. I mean, you just look at the front building, there's a little window, double doors. And it's a two story building it's historic and there's plastic on the front.

00:14:01 You can pull the plastic and put your hand into the building. Like that's how unkept this was. It was really, really bad. And I mean, it's been vacant since I was a kid for 26 years at a time, I was 26 when we bought it. And then it was funny. I was a family dinner and I told them, I told my,

00:14:18 my brother Jake, who's a marketing chamber of commerce guy. And I said, Hey, you know, who ends up building? He's like, Oh, I just met with him. He's from an hour away. Here's a cell phone. Give him a call. He's trying to liquidate all his properties by chance. Yeah. This guy's old owns like a hundred properties.

00:14:31 So I called him, he bought it 26 years ago. Never did anything with it. And when it became decrepit, it was really bad. I walked through the building with him and this really, really old man. He was a stowaway from like Germany. She was like 79, I think. And he was like, Josh, I've been waiting for the right person.

00:14:46 It wasn't for sale. He said, I was waiting for the right person to talk to me about this. And I think you're the right. And these, like, if you want it, you tell me what you want to pay for it and I'll give it to you. I was like, okay. So I made him an offer so low.

00:15:00 Anyone would just, I mean, it's, it was not something I can say the number, but it was so, so low. It's just like one of those stupid things. If, if someone said yes to this, you'd be an idiot to not take it. So I gave him a number. I felt bad about it. And he shook my head and said,

00:15:11 it's yours and I'll finance it for you. So yeah, I know. Right. It's like, literally it was divine intervention for us to own that building. It was crazy. And, and then two months later we closed on it. We started renovating it and I was like, Hey, everyone's asking us what it's going to be. And it wasn't supposed to be coworking.

00:15:31 It's just for agency, we're going to let this lease lapse and we just going to move over. But then we got a lot of interest and this place started getting really busy. And then I was like, you know what? Let's, let's go all in on this. So then, so then I thought it was only gonna take six months. And I told everyone that til the end of the day sin,

00:15:52 I was like, Oh, it'll be done in three months. And then three more months and then three more months. And then six more months. And then 24 months later we opened. So You're like, this is a story about buildings I had. And I don't know if you know him. So Josh is a member of my coworking startup school.

00:16:09 And Matt Maurice was on a couple of episodes ago and he bought a building in Milwaukee and it sounds similar. I looked at the pictures. He has like the, before pictures on the website or somewhere. And I was like, I mean, you have to have had, had a vision to see it. Cause it sounds like you're building, like,

00:16:26 I wouldn't be rolling up to that building thinking, let me see what I can do with this. I'm turning into a coworking space. And he said the same thing. It took like two years longer than, you know, than he thought it would. It was kind of a big undertaking. I think that's like, so that's just real for me.

00:16:42 Like that's a really a strong gift of line. Like I walked through and I walked through a realtor realtors. I brought, walked through with family that I really admired. I walked through with other entrepreneurs. I walked through with local people and I said, what do you think of this before? I officially did make the offer to the guy or before we close?

00:16:57 Cause I had the ability to back out and walk him through. And I'll probably, and I walked through the fire. Marshall, I'm good friends with the fire Marshall and the city engineer I walked through with everybody. Right? And I think two people said, this is a great idea. Everyone else says, I mean, this place had full walls set up.

00:17:15 It had dropped ceiling. It had 13 layers of carpet. It had been vacant. It had mold in the basement. It had a stairwell, right? When you walk in the front doors, in which straight down into the basement, it was the weirdest, ugliest thing you could imagine. And the second floor had been, I mean, I've been making for so so long,

00:17:31 it's vandalism everywhere. And I walked through it and I'm walking through with the fire Marshall and he was like, Oh boy, I have to do this, this, this, this, this, this and this. And I was like, all right, we could do that. I was like, but I want to put a restroom here on that.

00:17:47 I'm thinking we have an open space. I want to door to go here down into a basement where I want to put a speakeasy. And so I just literally started casting the vision because I'm just really good at seeing that. And nobody saw it and like my wife barely hung on by a thread and she got the idea, but she couldn't visualize it.

00:18:06 Like I could. I'm like, we're going to believe in your vision. We're going to break up, open the entire front of the building. We're going to reframe the window. We're going to have a penny walkway. We're going to have lights. It's going to be rustic. I want to expose the tin ceilings and the brick. And so like,

00:18:20 as soon as I got into it, no one really saw it. And then three months, six months, nine months as we went on, people were like, Whoa, this is really cool. And, and then I think that's, that was a really cool experience to see it come your vision, come to life like that. Yeah. I'll link to some photos in the show notes.

00:18:37 Cause it's, it's amazing. So you bought the building thinking, you'd move the agency over. And then at some point you decided to do coworking as a building owner, you mentioned sort of thinking through longterm tenant, at what point, you know, how did you think about the economic trade offs of putting in a coworking space versus putting yourself in there and then maybe another longterm tenant for the stability?

00:19:03 So I read a book when I was a 19 rich dad, poor dad, the most classic book, and no one needs to read it. All they need to know is rich people buy assets, poor people, buy liabilities and the bigger the asset, the, the more profitable or the more beneficial to be it'll compound. And so when we bought it,

00:19:21 I'm always like, how can we squeeze the most out of this? We own a vacation property in Tennessee and it rents out like crazy, really profitable. And like, how can we fight that and do something similar? And if you look at the rent rates I could rent, like we have it's two floors are 2300 square footage and I could rent each floor for $1,500 a month,

00:19:40 maybe here renovated. So, I mean, there's not a lot of profit in longterm rental units typically until they're like really paid down. And so then all I had to do was take Jamie's coworking school and run a port, proformance realize, Oh, I can do six times that amount. If all I did was put a front reception desk and rent this stuff individually and I'll have community and I love people and I,

00:20:07 and I think that's super cool. So I just simply ran the numbers and I'm like, Hey, it makes sense. We'll rent back as an agency and we'll even keep this place. So actually right now coffee space has 4,000 square feet here. Right now we have our entire conference room booked for the next four weeks, Tuesday through Fridays, someone just walked email yesterday.

00:20:25 Someone just walked in the door today and said, Hey, in three weeks, could I book it for four days? And we said, yep, signed them, cross us through our office. R and D. And I was like, so we actually have both, we have this, this building. And then we have that one, the first floor done until we go to the second floor.

00:20:41 So you're going to add an additional floor in the, in the new space. Yeah. We've gutted it, but I don't feel like spending a hundred thousand dollars on it right this month. Right. You can give yourself a little time to recover. I've learned two things. I'm really bad at estimating time. And I'm really bad at estimating dollars. So we went two and a half times over our budget and I was getting really nervous at the end there.

00:21:04 So we made it happen though. I feel like that's one of the risks of the real estate purchase. I mean, even when you lease and you do a build out, most people will go over, you know, their, their budgets, but when you're buying and you have to do the full renovation, most people go over and I'm with you on the bad at estimating time,

00:21:26 I would be in that boat as well. So, but speaking of, kind of build out why you did some of the work yourself. I remember seeing you kind of like building your front desk, give them, you know, all the things. Can you talk about kind of what you had other people do and what you did on your own? So I'm a big thinker and I'm really good at posting Instagram photos,

00:21:48 but I am not very handy. In fact, yesterday our air, our heater wasn't working. It was the first or second time we had a user this season in Ohio, it's getting cold and I call I'm good friends with the, the, the company that is our, our HVAC and installed into Honda. I said, Hey, Joe, there's no heat coming out.

00:22:07 I've let this thing run for six hours. Now it hasn't gone up a single degree. And he's like, well, do you need to change the filter? And I was like, how do I get to that? And he's like, I'll come over and I'll show you how to do it. And then I looked, and then I was like,

00:22:20 all right. And I talked to Kelsey and I was like, yeah. He said, when you change your filter, Oh, she's like, Oh, hold on a second. She climbs onto our fridge. And up onto this whole platform thing we have in a corner pulls up and she was like, yeah, we need to replace the filter. Hey,

00:22:31 can you write down this, these specs for me, it's a 13 and a half inch by this here's the brand I'm going to run to home Depot and replace it. Like that's how unhandy I am. So I hadn't really been intentions going in with a sledgehammer and demoing for about two weeks. And then after that, I realized this is a lot of work and I am not very good at this.

00:22:53 So I outsource most of it. I did some small stuff here and there, but I will say at the very end, it was kind of frustrating because at the end, contractors just wanna wrap it up and they start cutting corners. They shortcut the crap out of it at the end. I mean, we literally went through so many contractors to finish it up.

00:23:10 And then they got to the point where I said, you know what, screw this. I'm just gonna YouTube, how to finish doing a lot of this stuff. And I just did it myself and I would not recommend that I would hire a builder, but it's really professional would finish it to the tee. But that didn't happen unfortunately for us. So that's why I did post a couple photos of me doing it.

00:23:30 Yeah. But you did make your front desk, wait, I'm trying to remember the barrel, a coffee barrels or what's the, Yeah. So a few things that we made in there, the, one of the few things that I made, well, I didn't even the whole thing, honest. I just hired someone to do it, but I went and I set the vision and you should post a photo.

00:23:49 Cause it's the coolest, I have not found a single reception desk like that. And I Googled for it. And basically for anyone listening, what it is is that because our it's coffee space, we call that coffee space, the coffee space, the port, and this is called coffee space. The high rise, two completely different themes. So the port is rustic.

00:24:05 You're going to see like chains and the restroom going down to like the wooden tables and everything has a port feel to it, port home ears. And so the front, I wanted big barrels and I wanted wood and I wanted burlap coffee bags on the front of it with like live edge wood for our reception. And I couldn't find anything. And so it was frustrating.

00:24:24 It took like, Ugh, it took two months to find the barrels by them. Santam standup is kind of like a, basically a Pinterest project almost. And so that was kind of fun. I did do a little bit of that, but then I had someone piece it together and make it actually stable. This is the beauty of Instagram, Josh.

00:24:42 It looked like it took, like I had this idea this weekend and boom, this is what I made. It took eight hours. I had to like drive. I had to find these Jim beam, whiskey barrels three hours away. It was actually a nightmare, but it came out really nice and I think it was worth it. So it's about it.

00:25:01 Okay. The, so I'm curious who uses your space? You kind of talked about lots of different people coming through your original space. What is your membership look like in the new space? So I'm very Some people just to kind of refresh on, on the environment. Yeah. So when I was going through your program and you're talking about, you know,

00:25:24 your ideal customer community avatar, I think I asked this on a call. I was like, yeah, what if our town is so small and there's not enough of one person because there isn't like, it's very spread out. And I mean, honestly, so we're the only coworking space in our town, which obviously, you know, it's good and bad if you're the first you're trailblazing and there's a massive educational curve.

00:25:47 Like when I tell people like, Oh yeah, we want a coworking space downtown. They're like, yeah, what's that, here we go. You know how offices are in buildings. And so, so like it's very spread. I mean, we have attorneys, Harvard professors, distribution managers, nonprofits, news sources, agencies like mine and another agency videographers.

00:26:08 It's really all over the board college students come in and professors come in, but yeah, it's, it's all across the board. So I don't know. I don't know if it's wrong, but like my ideal customer though, isn't probably a single person because I don't know if our town is honestly big enough for like a particular like, Oh, we only work with software teams,

00:26:29 no way we would die. But I think for me, it's someone who isn't hurting financially from our higher rates, because we charge what they charge in Columbus in to live in Ashland. You could, it's like four times cheaper to live here. It's so much cheaper, but we charge the same rates as in Cleveland and Columbus. And so I don't want someone to hurt from investing in coming with us.

00:26:50 And then I really want someone that is going to be invested in the community and wanting to be part of it. And actually, and the third thing is showing up. Like it blows my mind how some people have signed up and they're paying $300 for a dedicated desk. And I see them twice a month, it's $150 a time. You come in,

00:27:09 just get a day pass or something. And they want to place the sat down their stapler and their pen. And that's all they have. And so I guess for me, I want, I've realized we're going to reel back and only have people that actually will show up. And we'll like really partake in the community, I think. And then where people that it's not going to financially hurt,

00:27:29 I don't want someone like I've had people come in and say, Ooh, it'd be a little bit of a stretch for me. And when I think that I'm like, ah, I don't want it to be, I don't want you to financially hurt being here. I want you to be excited to be here and happy to pay it. So I don't know if that's wrong or not.

00:27:43 And them, your rich dad, poor dad book and tell them to come back and it kind of late. Yeah. I didn't need you to submit a budget to me before I approve you here. Just How focused you are on finance. And it's anyway, we can talk about that separately. So, you know, I'm going to give credit to Jess Bommarito who is on the podcast.

00:28:06 I don't know how many episodes ago, April, maybe she has a space in a small town in Canada and the way she talks about her ideal member is it's more of a mindset. So to your point, anybody in town, you know, might be, except that she's trying to attract. I think that's what you just described is people who really want to be engaged and they they're willing to make the investment.

00:28:30 Like, Hey, they have a business reason for being there, but the community being an engaged part of the community, it's important enough for them to become a member. So it's more of a mindset and it's less about like what they do for work or what kind of coffee they drink or where they shop. Yeah. It would be too difficult because we were the largest office space in downtown.

00:28:49 When I renovate that second floor, no one will be able to beat us and we're the largest office space. So to try to say, Oh, we work with these three ideal customer. Avatar is, you know, we only work with these are talents just way too small it's but yeah, I would, I would say that I think the mindset is a huge thing.

00:29:06 Like I just want to surround myself with people that actually care and they show up and they're genuine. And because I just want to love what I do everyday. Like this isn't, our agency works out of here, so we have our staff here and I just want a larger community. And I really enjoy that personally. So did you have any fears about being able to fill the space?

00:29:27 I mean, I'll be full yet. You just opened. When did you open The last few days in July? So we're we just past two months, basically the 1st of August. We're we're two months open. Yeah. Yeah. I would say my confidence out of the gate was I'm a really competent guy. I don't like I'm not cocky or arrogant. I'm just confident.

00:29:50 I would say. And I was just really confident I do in a marketing agency. I'm like, we could do this. I'm really connected. Cause I've been intentional about that. But I would, if I'm being really honest, my anxiety heightened, the closer we got to opening. And I don't know if it's because COVID delayed us by like four or five months of opening.

00:30:11 Our budget was two and a half times, but over, so my mortgage was way higher when I rolled it all into a mortgage. But as we got closer, my anxiety probably did go up a pretty significant amount as we got closer to opening. Cause it's like, it's actually here. Like I don't, I don't know. So it probably heightened a little bit,

00:30:30 but overall regarding like opening in like a small city, I don't know. I have a pretty good amount of peace in my life and like a lot of my business endeavors and what I do. And I just I've learned that everything always works out. Maybe not how you think it does, but it does always work out. And so I don't know.

00:30:47 I was all right, just right before we opened, I got, I got some anxiety and then yeah, I mean, we're at we're we're not full occupy occupancy, surprisingly, you know, I thought we'd be at a hundred percent in three months. Of course you did. Of course things, everyone. I try to manage those expectations. But According to my,

00:31:08 my first proforma that I ran with you, you're like, Hey, it takes 18 months to typically get to, you know, a 90%, 80 whatever. And I'm like, okay, Jamie, I'm going to do this in three months. It can take 18 months, but I do it on my timeline. That was a wrong confidence level. And so,

00:31:27 yeah, we're probably at almost 50% I would say, but it's Incredible. Can you talk a little bit about your sort of pre opening pre sale efforts and to your point, educating a community. I mean, you had some folks, I assume that kind of were on the waiting list, transfer from the other space, but still some heavy lifting I would assume.

00:31:50 Yeah. I mean, we, we actually stopped, we didn't take members while we were building out coffee space. We decided we're not gonna let anyone else join our small group of people over here yet. Cause I want them to come in with the new standards. Cause if they came in early, they would have like this super laid back, lower rates.

00:32:06 I'm like, let's just put them on a wait list. And so what I would say is I was not going to really pre-sell heavily, I was under the I'm just like, you know what? We're just going to open and I'm just going to start running ads. I'm going to do a brand. We hired a videography company to document the process and it's a gorgeous brand video.

00:32:24 It was unbelievable. The narrator did a great job, which was may on them. No, I had someone scripted. It was really, really good, but I thought I would do that. And then honestly, like going to your program is so helpful. Like, and actually before I even bought your course and I kind of joined the community, I was listening to one of your podcasts and I binge listened to your podcasts.

00:32:48 So when we first got the idea to do this, I started, I'd binged them every morning. I finished CrossFit. I meditate, read in the morning on then while I'm getting ready and doing other things, I'm just listening to your podcast. And I probably got through the first hundred then like a month. And so every time I'd get a new idea regarding marketing,

00:33:03 I'd write it down. And the idea of involving your community doing, you call them hardhat tours. And I'm like, I don't have a whole lot of hard hats. And so I'm just going to do coffee tours. And so what I did was I scheduled private tours and I'm really good at storytelling. I mean, we're in marketing. So we have copywriters and like I'm really good at telling stories.

00:33:21 So I developed a script and what I would do is I would schedule coffee tours and I would run ads to it. And people could sign up on a wait list and they would get a certain week block and to be Thursday from six to seven 30 and they'd come in, we'd have donuts. I'd be making the espresso, pour over coffees, hand them all out.

00:33:39 I would tour the building. I would tell stories about the 110 year old history of it. And I just got people honestly like inspired and excited. So I think that the tour is where one of the biggest prelaunch things, because even if they weren't going to rent from us, they know what we do and they've referred people and now, and so we really set the stage there.

00:33:58 And so I set up a one page that was a big takeaway. Like the tour idea that you had was brilliant doing a beta week. I never thought about that one. So I was like, Oh, we'll just work on the kinks when we open. And thank goodness, it turned into a two beta week because we worked out all of the kinks the first day we had no music.

00:34:16 So it's an in, in the new building, it's a pretty open concept and we're in there and one guy was just sitting there and he makes his own yogurt. And he's sitting here in a glass jar and he's like Clink clink. And I'm friends with them. Yeah. He's actually, he's been a member since we opened actually. And so from the beta week,

00:34:36 so he came to the beta week and he's there, he's an entrepreneur, he's a photographer and he's just clinking. And I look over at him and he's like, I don't know how I get even designed in quieter here. And then like after the first day I was like, thank goodness. I follow Jamie's idea of a beta week because we had no music.

00:34:52 It was so quiet. It was so awkward. And we worked out a million kinks, which was great. So that was probably our largest like doing that. We hosted a private catered party. And what I did was because we built so much momentum, I catered it with a local brewery. We had the nicest food. I did a whole humorous presentation for about 30 people that got private sealed invites that we handle livered to like the mayor and all these,

00:35:17 like the fire Marshall and everyone who we knew we needed to know what we were doing. And we had a chalice there. Like it was really fine. It was really cool. And it just kind of spread like wildfire, but just storytelling and bringing people in is what really everyone who poked their head in during renovation, I would just stop and I would tour them the whole and I would tell stories about it.

00:35:39 So I think involving our community in storytelling was our hugest presales has got everyone excited. Yeah. And do, and finding the thing that resonates with you, like the coffee tours, which so we have to talk about the coffee. What are you, what are you serving in this space? So we serve Folgers and Maxwell house. No, I mean Maximo,

00:35:59 which is Maxwell house coffee, and Kelsey will pull out his middle name when he's in trouble. Max white house, get over here, which is great. We named them. But that's honestly no offense to anybody who drinks that it's a real, it's not even a coffee it's called. It's not erratic. It's called Robusta, which is not real coffee anyway.

00:36:18 So we we're very intentional. Like we way even all the coffee we make for all of our staff. There was one thing that I did is our theme. It's called coffee space. Coworking is, is, is our, our coworking space. And it's called it's our last name, but it is coffee theme. Everything is coffee themed. And we're very intentional about it.

00:36:37 We weigh the grams of coffee to the grams of water. We have the, the, the beans fresh ground. We'd like nice grinders and espresso makers. Everything has ground to a certain fineness. The water is at a certain temperature. You can't have a community manager. She won't put up with your, you want me to what you want to be?

00:36:56 Well, well actually we were gone. The last we just started, this is our first week back. Last two weeks, we took a two week vacation in the middle of the wilderness and we had someone come in, she opened, she closed, we refill all the crafts and everything throughout the day. It's all labeled on chalkboard, little things that say,

00:37:12 Oh, this is Panama. This is Rose. This is medium roast. This is darkness. And for both buildings. So we refilled them throughout the days. Nobody's without coffee, we order a small batch, locally roasted coffee and source it. I actually import like 65 pound bags of green coffee. And we have like a commercial grade coffee roaster we'll even do some of our own.

00:37:33 So we're, we're really serious about our coffee. She hung in there while you were out. Yeah. She loved it. Actually. She came back and we've been telling her, it'd be great to have her as our community manager. And she was like, no, still in school for business. I want to finish that. And as soon as we came back,

00:37:49 she was like, actually, I could really consider doing this for a career. I love the whole convenience. And you told her who needs a business degree. Sit next to me. And I will teach you the ways. Well, I told her that two years ago, but her parents Trump's Josh coffees, you know, Imagine that. So tell me just a couple of,

00:38:13 I love to ask this if new operators, what was a good surprise on your journey in a, in a bad story, I would say bad surprise. Not having enough customers right away. I was really hoping we would get a lot more, but of course, I'm super optimistic guy over here. Nobody's starting a business without too much. So this is,

00:38:36 this is the thing, right? You need an optimism and a little dose of reality about, you know, three minutes in, but it was yeah. Not having a customer by the way, but I think everybody, that's their goal. And then not everybody likes open spaces like I do. So over here, it's more segmented. We have private offices.

00:38:54 I'm in like my old corner office. I love it. But I also love being around people. And I love the open bog. We have sit, stand desks and autonomous chairs and everything. And even dividers, like soundproof divider things. And I'm like, Oh, this is so cool. This will enhance the, the collaboration. Most people I tour,

00:39:12 both buildings are like, when is this space going to come available across the street? I'm like, we just renovated this and this is the best place. But I think that it makes sense. So it depends on what they do. If they're on meetings a lot, you know, they often need that more private space. And I think that was the biggest thing I learned.

00:39:28 So when we looked at the second floor, I drew up plans for all private offices. And you, you stated that about 1,600 times on every podcast, every training you're like, everyone's gonna want private offices, everyone's want private offices. And so now I realized you were correct, and we're going to change that. But we are still going to keep the first floor pretty open,

00:39:50 Which I love. So you'll have both. And I also always talk about the tradeoff, right? Because when you're building, what are you doing? Your build out offices get expensive quickly, right? You need more walls, HVAC, you need sprinklers, you need all the things. And so you have to take that into account. Even if you believed me about the mix,

00:40:10 you still, most people are going to make some trade offs about what the actual build out looks like. So now you're going to give yourself some time to build up some cashflow and then, you know, you'll do it over time and that may be their best approach anyway. Yeah. And I've already gotten, I mean, immediately when we opened, I came over here and I got quotes to have another five private spaces we have here that have half walls.

00:40:31 I got quotes to put up all the walls, redo the lighting, redo the floors and put doors on them. And so I don't know if I'm ready to sink that in quite yet with the CA cause I, I leased this side and I have to really, I don't know how much you want to put into place. I leave, which I don't know how someone does,

00:40:47 like a $200,000 bill down in a leased building. That's a big investment in my opinion, when you don't own it. But in bigger cities, I get you to buy a $1.5 million facility. It's a pretty big chunk. But yeah, so that was the biggest, like bad surprise. I would say best thing ever, meeting rooms. I remember when I fill out the first proforma,

00:41:07 there was like mailboxes, virtual mailbox day passes. And you know, you fill out the spreadsheet to say, Oh, what's your mix going to be? And I put in there and I put zero next to the conference room book things. I just put, you know what, we're just going to assume we don't get any, I don't know why people would want to come into a space or not part of and rent meeting rooms.

00:41:26 And we opened and within two weeks, I mean every week, two to three requests a week to book our large room, our small meeting room every week for the last four weeks out of the two months. So after two weeks we started having about four full days, booked a week of our large conference room at like two 50 a day for that single room.

00:41:46 And I'm like, that's what I'm talking about, man. Jamie was right about this conference rooms. I put it on our question list because there are lots of people who have no meeting room business right now. So I think it's super interesting. Are you guys masks in your space or no masks in your space? Well, I don't want to tilt the ship too much here,

00:42:11 but we are 98%. Everybody doesn't wear a mask, but the other thing is Ashlyn. Isn't had a single death. It's a small town, but literally there's like 15 cases in eight months. So it's kinda like we don't wear them. Some people do. And I totally respect it is great. Not even my wife who sits in the front desk does I don't,

00:42:31 I, I want to mass three times in eight months, but, And to your point, you're in a place with a totally different risk profile. So I was just curious because I'm always trying to like figure out what is the, like, why do you have meeting room demand and other people don't, there's another woman. I always forget where she is said Romberg is in my flight group program,

00:42:53 a brick house blue. So she's also in a smaller market in Ohio and also is getting for sure not to pre COVID levels, but it seems some nice meeting room demand. So I was like, what is it about Ohio meeting? Well, here's the interesting thing. Most of the people actually booking it are not from Ashland, but that's the minority it's companies coming in from Cincinnati and Dayton and Cleveland and Columbus.

00:43:18 And we're somewhat of a middle ground, I guess. So we have like the brethren district head office for the local church is booking it for three days. And I just had another organization reach out yesterday and someone today. And it's like, one of them is from Philadelphia and they're opening a branch to a new office an hour away, but they want to train some staff here.

00:43:38 And I, so, so it it's kind of worked out. So a lot of the people come in and they're all wearing their masks when they come in. I mean every city, city to city, even within 10 minutes, they're all different. Yeah. And so like everyone's coming in, they're wearing their masks and they're doing their thing, but no chaos quite yet.

00:43:55 So I mean, I think the only thing that plays, They meet in Ashland, what's their alternative, right? So I, I think that might play in our benefit. There's not a crazy amount of event meeting space. We only have an eight person conference room in a four person conference room. So it's not like it's crazy, but I think our small town,

00:44:15 this definitely plays a factor. There's not a crazy amount of options, but I also think that we have gorgeous Google photos. We have a brand video we're running Facebook ads. Someone reached out to the person who reached out yesterday. It was because they saw our Facebook ads and they've noticed we had a, that we have conference rooms and they said, I'm doing retreats all the time with my clients.

00:44:37 How much is it for full day, half day? And so I think because we're doing advertising, that's another thing. And we're about to launch, or we just launched our Google ads for meeting rooms yesterday that we'll be running just the word capitalizing on that. But I did not expect it. I will tell you that I'm like, wow, this is the one of the most profitable things that we're doing.

00:44:56 And I expected $0 on a pro forma about the potential here. It's hard to predict. It depends on so many factors. So I think it's okay. That you're pleasantly surprised. So I'm glad that's a good surprise. So I am really curious. So can you talk a little bit about what your marketing agency does and then how you're marketing the space?

00:45:17 Yeah, so, so w I own a digital marketing and design agency called flight media, and we are sorry, my calendar. And so everything we do is digital. And so that's been a challenge for us. It's been interesting because we work with clients all over the United States. And this is interesting because I'm not a local business with five media, but this is a local business.

00:45:41 And so we work with local businesses and that's the minority that we work with, people that on e-commerce and it could sell all over. And it's way easier when you can sell nationwide versus just in like a zip code. And so it's been interesting, kind of getting the word out, building the brand here, but it's been fun because it's been a challenge.

00:45:59 Like most of our clients, we don't have to worry about Google reviews, but this is a local business. So we need that. And so it's been kind of fun being able to do that, but we have a simple strategy for almost every business, whether you're local or digital that we follow. And so I just follow that exact strategy and it works like gangbusters,

00:46:17 and it's really easy. Well, for me, cause I know how to, we know how to do it and you need to kind of know some technical, but there's really four things I, every business needs to do first. You need to give away something for free. And so it doesn't matter if it's a free week, day pass, ebook,

00:46:31 free Fridays, you know, membership, giveaways, we're even looking one of the things we're going about to do, hopefully by the end of the year, roll it out in January and hoping is we want to do a mini local shark tank deal where local college students entrepreneurs can apply. They can come in, they can present. And if they win,

00:46:48 we're going to provide them with space and some seed money to, to actually work in our space. So they'll have a place, they'll have some seed money and by giving away something for free, we're going to have a huge host, well, guess what? We're hosting it for entrepreneurs. And guess what? We're a place for entrepreneurs. And so w we'll get a hundred applicants and one person wins and now have 99 leads.

00:47:08 And so we're giving my stuff for free free day is, and then having a social media schedule, sticking with it pretty basic. And then the biggest, one of the last exists is running Facebook and Google ads. A lot of people don't do that and it may sound complex and scary. And at first it might be a little bit, but you could easily learn to do it.

00:47:30 I mean, that's how our agency learned. I just Googled everything until we were experts at it. And we did a lot of tests. And so just running it for free passes, college students, whatever that's really, really crucial cause you need cold blood. And I think that that's where most people get it wrong. They think people are just going to show up and paid ads digitally is easiest way.

00:47:47 And the last thing is email marketing. Somebody who build a list and they don't email to their people. I mean, you know that right? You have a program, then you have your coworking space and fun fact, if someone here isn't a marketer, the number one form of ROI when it comes to marketing is with email. On average, you can make about $38 per dollar invested in the resources to do it.

00:48:08 So if you're regularly marquee marketing, you'll make a, you'll make most of your money, your sales from nurturing and building trust that way. I think so many local businesses, it's just not on their radar screen. They've never been trained. Same thing with the ads. I think especially now the ads are critical because you've got a segment of people out there who are not actively searching,

00:48:33 right? So your Google ads are going to capture those people who are meeting room Ashland, Ohio, and you're going to make sure you pop up, but the Facebook ads are getting in front of people who don't know to look maybe right. Aren't aware of coworking is a solution. And even in bigger market, so good for smaller markets for educational purposes,

00:48:52 but even in bigger markets, there's always people working from home who may not even know. And so we have to tell them and we have to kind of interrupt them and get in their way because they're not typing in coworking near me and Google. We just did. So I, you know, I have a community manager program and last month our training was on Facebook ads and just kind of more of a strategic approach.

00:49:12 And we're going to do some kind of workshop sessions to get people into it. But I think it's a huge opportunity. And I'm always my new, my new Google. My business is email marketing. I am always talking about how important your Google, my business listing is. And I think email marketing is really under utilized. Yeah. I mean it's,

00:49:29 and it's so easy. Like you have, by default, you have a day pass person, come in, collect their information. Like don't just let them come in and not gather that a handout free passes go up to your local college campus and just hand out a hundred free day passes to college. Students, get them in there, get their information when they come through the door.

00:49:46 And then now you have a hundred leads and just email nurture to them. It doesn't mean they're all going to come in, but you're gonna, you're going to wear on them. And they're like, Oh, I need to go here. Like, it'd be so cool. And then build a call like a college membership or a pay what you can plan or whatever that is.

00:50:00 Yeah. And the other thing is like, we, we have a huge educational curve. So like for us, we are running the Facebook ads. I I've done it so long. It seems pretty easy. But the biggest problem people run into with their ad sucking and not generating anything is the fact that they focus on what they do. Like on Facebook I could say,

00:50:19 Oh, come rent space at our coworking space. Like if they don't know what that is, they're not going to relate to it. The problem is like right now, there are many people that have horrible productivity. They're a distraction galore. They want to get out of their house, but they don't think of coworking spaces, that solution. So you have to stop talking about what you do and start talking about how you help.

00:50:39 And so being able to say like for us, the first line in our, one of our Facebook ads, we have a lot running. It says, unlock your productivity at coffee space with a coffee space, coworking membership. And so we're talking about unlocking productivity, your office away, your, your, your, your office away from the home. There's no distractions.

00:50:57 There's no longterm leases. Like talk about what they actually care about. Not just say, Oh, come rent space. Because people don't think of it like that. You need to solve their problem. Yup. And I think people go straight for the cell or the come in for a day pass without putting the context around it. Yeah. And if you're in a small place like ours,

00:51:15 people don't even know what that is or like what's a day pass. So like one of the things we did with coffee space, we just got an, a frame sign. And so I've never had one of those. So it'd be fun, but we're always going to have a funny like office quote on the one side and the other side, we're just going to start off by saying,

00:51:29 what the heck is coffee space? We're gonna have a bullet point list. And it's going to say full and part time office space, meeting rooms, unlimited craft beverages. Cause we have beers and all kinds of stuff like that. And then I'm going to put not a coffee shop. Cause like people don't know, I'm just educating them. People think we're a coffee shop and we're not,

00:51:48 I probably kind of hurt us because my, I call it a coffee space to be fair, but we're just, you're just going to educate people. And so that's kind of what we're going to do. Yeah. Yeah, no, I love that. You mentioned you're a digital marketing guy, but you're, you know, you talked about some, some hustle approaches,

00:52:05 like going to the college campus and getting your A-frame out. It's like sometimes the simplest things can make a big difference. Yeah, it's crazy. But I would say this, like if anyone listening right now is maybe they have a space open or they're hurting right now. Cause I know a lot of coworking spaces are based on I follow coworking space hashtag I follow stuff on Instagram.

00:52:27 Cause I'm just, I love studying the industry. And I would just say, because you know, we're on the front lines for clients all across the country, we handle their marketing. So we see firsthand, like we are that entry point for customers of dozens of industries or businesses. And so I would just say that ultimately there is hope. And I think that anybody who maybe is experiencing that pain,

00:52:50 like you just got to get out there and you just have to grind it out because like we're seeing some tides turn, which is really, really good. The recession is breaking through. Yeah. There's predictions, but that hasn't happened yet. And so there is tide. People are starting to spend again, people were starting to get out again. And I think the people that are gonna lose are the ones that just like blame the world and COVID,

00:53:09 and they don't try to reach new people right now. And so I think that's why we're leaning into it. We're leaning in ad spend budgets, everything we can because I know the long run we're gonna in a way more than pay for itself. I love it. Josh. Thank you. So my timer running out, I think that's a perfect sentiment to end on.

00:53:29 I appreciate you sharing your story and sharing your marketing tips. And I look forward to following your journey. I will post some photos links to some photos in the show notes. Also Josh has a really fun Instagram account to follow. So I will put his handle. He's at Josh coffee, C O F F Y in the show notes as well. He had a great post today,

00:53:53 which I won't read through since we're running out of time, but his, his sort of eight daily tips for success, but he's great to follow super inspirational. And I look forward to following your journey and catching up again next year. Cool. It's been a pleasure.

For the full show notes of this episode, click here.

Want to join our coworking conversation in the Everything Coworking Facebook Group? Find us here!

Looking for a specific episode? Go to the episode index here.

Jamie RussoComment