September 30, 2011, will be Carrboro Creative Coworking's last official day of operation. At this time I have no plans to continue operations with CCC, although I believe in coworking as strongly as ever, and I'm pursuing options that would continue my involvement in the coworking movement. I'm writing this post to explain how the business got to this point and why change is necessary.
I started Carrboro Creative Coworking to support workers -- specifically freelancers, telecommuters, and entrepreneurs. These are workers who have escaped traditional nine-to-five jobs to work more flexibly. This flexibility provides huge benefits in the form of freedom and autonomy, but some have encountered the unintended side effect of decreased productivity. It can be hard to get work done at home, where you face such normal distractions as children and laundry; or to work at a cafe, where people and music compete for your attention.
In our three years of operation, I've witnessed many examples of increased productivity at Carrboro Creative Coworking. The ritual of leaving the house and going to an office mentally prepares us to begin working. Once we're there, a silent undercurrent of positive peer pressure encourages us to work efficiently. Without the distractions of home or cafes, we get things done!
Carrboro Creative Coworking has been a huge community success that has served many independent workers. CCC even helped two businesses grow so much that they had to leave to find bigger office space. One of those businesses stayed right here in Carrboro after they moved.
Unfortunately, the costs of my current coworking business model have turned out to be higher than the potential maximum revenue. The reasons for this are systemic, including high costs for office rent, Internet access, and payroll. On the revenue side, sales are small because there aren't enough customers. A large number of potential customers are unwilling to drive more than twenty minutes one way to cowork. That puts more than two million Triangle-area people out of range of this Carrboro-based business. Also, the bad economy has reduced personal and business budgets, meaning that some potential customers cannot afford our prices. All of these reasons have combined to prevent Carrboro Creative Coworking from operating at a profit.
My original business plan was designed for an open floor plan in a small space. But when I was starting CCC up, that kind of office space wasn't available in Carrboro. In addition, my startup capital was coming from the Town of Carrboro revolving loan fund, and the town required me to have a lease in downtown Carrboro in order to qualify for a loan. So, to qualify for the loan, I grabbed what office space I could find, which was our current suite at 205 Lloyd Street.
In retrospect, that was a mistake, and I take full responsibility for it. This office is chopped up into two common areas, a break room, and several small offices. The floor plan dictated a major change to my business model, forcing me to be in the office lease business. In that business model, more square footage is better. To that end, I wrote several financial plans that called for massive growth from our humble beginnings. In these plans we would sell tons of executive office space, with coworking on the side. Unfortunately, the economy worsened, and the startup capital necessary to fund a large-scale expansion became scarce.
I'm working on strengthening partnerships that will allow me to continue to provide sustainable office space to independent workers while also providing much-needed financial support for my family. Stay tuned for more details on this new business direction.
I owe a debt of gratitude to many people who helped made Carrboro Creative Coworking a reality. Thanks are due first of all to my wife. Without her help and financial support, I would not have had the freedom to pursue this dream. I also appreciate all the friends who spread the word about CCC. I also want to thank the Town of Carrboro for its steadfast support and unique revolving loan fund. I will honor your investment in me and find ways to enrich Carrboro throughout my life. Finally, I want to say a huge thank you to my customers. Your support made the past three years incredibly rewarding. I look forward to continuing the professional and personal relationships that we've created.
- Brian Russell, Founder & Owner
posted: July 12th, 2011
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