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Business Observer Friday, Jun. 22, 2012 6 years ago

X marks the spot

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A group of entrepreneurs is building co-working space it hopes will become a hub of entrepreneurial activity in Naples.
by: Jean Gruss Contributing Writer

What would entice people like Colby Brannan to get out of the house?

Brannan, 37, has worked 12 years from his home in Naples for a telecommunications company, calling on corporate clients around the country. “I've got three kids, and I can't tell you how many times they've barged in,” he says.

David Diamond and his business partner John DeAngelis, who together own DeAngelis Diamond Construction in Naples, and David Diamond's son, Brett Diamond, are creating a kind of office space they hope will appeal to road warriors, startup entrepreneurs and independent professionals who currently work from home or coffee shops.

Called Venture X, it's “co-work” space. The 8,000 square feet is essentially one big room with power outlets at every open desk, fast and secure Wi-Fi, free coffee, lounge seating, conference rooms and lockers. It works like a gym and members pay $500 a month or $35 a day.

Such co-working space is popular in technology centers such as Austin, Texas, Silicon Valley in California, and in urban centers such as New York City and San Francisco. Often, these spaces are converted warehouses where young tech entrepreneurs gather to collaborate in groups. There are no cubicles and the space is wide open to promote teamwork.

The founders of Venture X concede that Naples' tech scene is limited compared with other areas. Although there's no conclusive data, they believe there's a large contingent of people like Brannan who work from home or are on the road. In fact, they say that technology entrepreneurs may be a minority of members. “Our space will become what our members want it to be,” says David Diamond.

Venture X is born from the advances in technology that give people the tools to work independently. People use mobile phones to communicate, they can brand their company on social media websites for free and they can store documents with cloud-based services.

This isn't grungy space. Venture X has the look of an Apple store and it's being built-out in the ground floor of an office building at the upscale Mercato development in Naples, home to Whole Foods, trendy restaurants and designer clothing stores. The tenant above Venture X is Merrill Lynch.

Similar efforts to create co-work space are under way in the Tampa Bay region, including CoWork Tampa and Tampa Bay Wave. But they're small compared with Venture X. “There aren't enough, they're not large enough and not visible enough,” says Heather Kenyon, CEO of the Tampa Bay Technology Forum.

Space crunch
Venture X founders won't disclose how much they're spending on the project, except to note that the furniture alone cost $250,000. Because they also own a construction company, Diamond and DeAngelis did much of the design work in-house.

“It'll probably take more than a year to break even,” Diamond concedes.

But Diamond says that executive suites in Naples are full and Venture X will charge half of what it costs to sign a lease for similar top-quality space. Executive suites lease offices and the tenants share receptionists and conference rooms.

What's more, coffee shops and lunch spots have started becoming less friendly to road warriors who spend hours there. To keep workers from camping out, these retailers put time limits on the Internet Wi-Fi service and covered up power outlets.

There's enough room for about 150 people, but Venture X will be able to sell as many as 200 memberships because not everyone will be there at the same time. Besides the free coffee, Venture X will host seminars and events for budding entrepreneurs outside business hours. The furniture is mobile, so moving the desks can open the floor. “We want this to be the hub of anything entrepreneurial,” says Diamond.

The design of the space with few walls is meant to encourage collaboration and interaction among members, something that would attract Brannan and others like him. “Psychologically, the isolation is tough,” says Brannan. “When you're sitting by yourself working at home, the silence can almost become distracting.”

Many workers want the flexibility of having an office without the leases and expenses that go with that. “I wouldn't want it to be tied in to a month-to-month,” Brannan says. “I'd like to use it on an a-la-carte basis. I'd pay out of pocket to do that.”

For those who prefer the privacy of an office, there will be four available. Memberships for those cost $1,750.

Members only
There is a membership application to fill out and Venture X founders say they want to strike a balance of people so that one industry isn't overrepresented. Diamond says they'll subscribe to the “no asshole rule,” which means that members can't take advantage of one another.

“We don't want people here to sell services,” says Diamond. “We want to promote collaboration more than competition.”

Diamond and DeAngelis have experience with the needs of the tech crowd because they invest in startups through their fund, StartupAngel.net.

For example, a secure and super-fast Internet connection is essential, and each member will be given a unique username and password. “That's what they rely on for business,” Diamond says.

While Diamond says Venture X may be a place where entrepreneurs could meet investors, it's not designed for that. “We're not an incubator or accelerator,” he says.

It could turn out that the Naples co-working space could attract a different crowd than expected. “What will happen with the snowbirds?” wonders Joe Gammons, the president of Office Furniture & Design Concepts in Fort Myers, the company that provided the furniture for Venture X.

Gammons says the space could appeal to the large number of retired executives in Naples who have grown bored playing golf or consulting from their home office. Envision 20-year-old startup entrepreneurs sitting next to retired CEOs, Gammons suggests. “That sharing of knowledge could be awesome,” he says.

Co-working in Tampa
The co-working space trend is already established in other cities such as Jacksonville and Miami, and Tampa now has two co-working space projects.

CoWork Tampa recently opened in 6,000 square feet of space on Armenia Avenue, and it plans to launch a marketing campaign in July. The space includes 13 private offices, 11 of which have already been leased, says Chris Arnoldi, the principal.

Arnoldi says the private offices cover the rent and he plans to make a profit by offering courses to entrepreneurs who use the co-work space. “I don't think membership is going to be where we make money,” he says. Membership costs $97 a month, but the courses will range from about $30 to $200 depending on the duration.

Arnoldi, 28, has invested about $100,00 for CoWork Tampa, but he's cautious about its future. “People don't want to take the risk, the way the economy is,” he says.

Another project, the nonprofit Tampa Bay Wave, is located in downtown Tampa near the arena but it plans to find new space. “In general, co-working is not a for-profit model,” says Ken Evans, a business consultant who is a founder of Wave. “Co-working is only profitable where you've got density and population.”

If he were to develop a for-profit co-working space, Evans says he would do it in no more than 2,400 square feet to encourage collaboration and interaction among members. “You want people sitting on top of each other, that's the primordial ooze,” Evans says. He adds: “Put a reputable geek in charge.”

Heather Kenyon, the CEO of the Tampa Bay Technology Forum, says she's trying to get city government to help subsidize more co-work space. She recently spoke to the Tampa Downtown Partnership about the idea. “I think it's vitally important,” she says. “Co-working space is a driver for job creation.”

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