Why did a business center operator buy one of the best known historical bay area’s coworking brand ?
What was the vision and how is the integration going ?
Laurent Dhollande, CEO of Pacific Workplaces and boss of CloudVO, one of Coworking Europe 2017 conference‘s partners, shared his insight, last November, in Dublin, during one of Coworking Europe’s session (cfr video below).
Strong community, weak processes
“No one can curate a community as well as Next Space”, says Laurent Dhollande, first. “They have a solid brand recognition and informal culture, which is an asset”.
“Independent coworking space management is a hard thing to operate, though, adds the CEO of CloudVO. Many are run by very passionated people who focus on the community, but often overlook the monetization of additional services as well as the improvement of the operational side.”
“Next Space different locations, for instance, were too remote from one another to manage the network easily. The management was very decentralized. There processes were not up to date. They didn’t leverage technology to run the space, for rooms online booking, for instance. They had an insufficient number of meeting rooms. They didn’t kill inefficient new initiatives fast enough“.
Word of mouth marketing vs SEO
“Next Space marketing was mainly made through word of mouth and social media, whereas we focus a lot on Search Engine Optimization (SEO) and search engine marketing (SEM)“.
Next Space’s financial situation was weak, whereas Pacific Workplace financial situation is strong.
According to Laurent Dhollande, Next Space wasn’t good enough with the development of additional side revenues, aside of the revenue stream generated by coworking subscriptions.
“At Pacific Workplace, Virtual Office, makes 30% of our revenues, as opposed to a mere 6% at Next Space”, illustrates the CEO of CloudVO.
Complementarity and ultimate convergence
Despite some flaws, Pacific Workplaces choose to keep the Next Space brand alive as well as the website. The identity is strong and the complementarities with the mother company seem clear.
“The is a convergence between the models, observes Laurent Dhollande. Within the coming 5 years, the two brands and customer experiences might become only one“.