South African serial entrepreneur Alon Lichtenstein examines a key aspect of business that many often ignore, and argues that coworking spaces can help solve the problem.
by Alon Lichtenstein
People enter the world of coworking in pursuit of greener pastures. But sometimes they don’t know how to actually get the green – the money. What I’d like to see happen is that coworking spaces, as service providers, make new efforts to help members get what they need to succeed, particularly when it comes to sales and business development.
I’ve coworked for years all over the world. Different companies I’ve worked on have been based in coworking spaces in San Francisco, New York City, London, Amsterdam, and Cape Town. From what I’ve observed, people and companies in coworking spaces sometimes have an overabundance of skills but aren’t as savvy with sales. This is a problem we should fix unless we want coworking to become a place where talented people come to waste their time.
Coworking spaces have the potential to serve independent workers with more than just community, free coffee, and designer couches – they are the best chance that independent workers have at filling basic needs for their role as businesspeople.
Here are some problematic situations I’ve seen with people and companies in coworking spaces, and what coworking spaces can do to address them.
Ambivalence about sales
When looking for an office space for my latest venture, I was told by one space that if I planned on regularly making sales calls, then it wasn’t the place for me because their members don’t like to be disturbed. Sounds like a place that doesn’t want businesses working there.
Coworking spaces can be very noisy with a hubbub of activity or silent for concentration. The place that I ended up choosing for our team has coworkers screeching to each other across the space. Maybe that’s not ideal but I’ve gotten used to it. When I’m on cold calls it can be difficult to find some quietude, and I think twice about how clients will react when I bring them over, but at least I’m supported in my very basic need to talk to people in the daily course of running my business.
Some businesses aren’t ready to be, well, businesses
Coworking makes it easy to set up shop, but hanging a shingle and having a business address does not necessarily mean you have a viable business. Lots of people find themselves freelancing or starting companies not necessarily because they are the next Richard Branson, but because the economy pushed them out of what they were doing before.
Many of us leap into business ownership on a hope and a prayer. Freelancers particularly are often specialists who try to build a business around their area of expertise. Sometimes they’re industry veterans that come to freelancing because they have the capacity to grow a business around their skills and experience. But sometimes freelancers are specialists that don’t want to have to veer from their expertise, and in focusing on that one area may neglect other aspects of their business. Worry about sales pipelines and sealing the deal is, for many, beyond their skillset or interest.
This is especially true where there is plenty of business for the short-term. When we are cared for today we don’t always worry about tomorrow. But the reality is that there’s always work to be done in sales and business development. Someone needs to generate this business for tomorrow. This doesn’t always happen as much as it should.
Getting traction is f&!%ing hard
I remember this great little company whose service was along the same lines as Uber. They came to life through an incubator/accelerator program and had great promise. However, sales was never their real focus because they had support. I recall having lunch with the team and their mentor. They were complaining how they might need to pivot because they couldn’t get traction. “But the tech is great,” they trumpeted. “Once people try it for the first time, they’re hooked.” Well, that’s great, but are they buying? Not really. I’d often wonder whose fault that really was. But rather than play the blame game, we can just lament that another great piece of technology went unused because they didn’t land enough deals to stay in business. I refer to that lunch as the last supper: their company folded and I never saw any of them again.
There’s one metric for success
In some spaces I worked in, there was no shortage of conversation, collaboration, support-giving, back-rubbing, table-tennis… over time I had to wonder, where are the deals? Where are the client meetings? Where are the sales guys on the phone punting to prospective customers? Where are the proposals and the pitches? I’m not talking about demo days or pitching competitions; I’m talking about sales. Where are the customers who are actually going to pay for that amazing new thing they’re building?
After years in the trenches, I’m sick of meet and greets with VCs and demo days. Much of that side of the industry is filled with rhetoric. The single metric should be sales. Can you get your product into the hands of people who will buy it? That is the only thing that counts.
Setting up a business is a long game. I see a lot of people playing, but not all of them are playing to win.
Is business getting done?
Sure, work is being done, but has money changed hands? If it’s not, shall I tell my bank manager about how our team delivered a brilliant presentation at demo day? That we pitched to our friends at the space and everyone loved it? That we have a great network of people and 200 users who downloaded the free version of our app? The bank manager couldn’t care less. I also assume she’d ask when I expect to be able to pay my overdraft fees.
I’ve stopped going to these pitch sessions and demo days because they are the same. There’s back patting, there are conversations, it’s great fun, and no one there will invest in your company. No sales, no investments. The best person to be at these events is the owner of the space that’s hosting it – i.e. the only person there who’s making any money.
Solution: Bring in independent sales people
Surely there are underutilized sales people with pluck and a pipeline who can’t wait to get out of the corporate grind. Why not try bringing in an independent sales person to match up with some great startups or freelancers? Get a sales person in your coworking space and there’s no shortage of miracles they could work. They could even work for two companies at once.
I’ve known some coworking spaces to go in on getting an intern, and then share the intern with a company in the space who also needs an extra hand. Let’s ramp that up and make it a hired gun who’s hungry enough to learn your business and then start shilling.
Yes, it’s always advisable that entrepreneurs and startup founders be the representative head evangelists of their brand. Of course your ideal salesperson is you. But does that mean you’ll overcome years of the cold-call version of stage fright? We can’t all be Steve Jobs. Plenty of business owners are hard-working with a great skill set that simply doesn’t include giving the elevator pitch every time you get in the elevator (is that why you take the stairs?).
For all the things that coworking spaces provide, this is a glaring need for many businesses. In time I hope to see more specialized coworking spaces emerge that address this and other inefficiencies and issues that independent workers face.
Coworking spaces would do well to recruit independent sales people with the same gusto as they sign up freelance designers and developers. If they want companies in their spaces to succeed, they should think about getting the members what they need. Otherwise we run the risk of coworking becoming a networking sandpit for hobbyists rather than a driving force in the new economy.
Until then, if your company needs help in sales or business development, get it at all costs or you’ll have nothing but costs.
Next up: Alon tackles what’s wrong with startup accelerators.