Startup policy labS P L d e v e l o p s t o o l s t o a d d r e s s p u b l i c p o l i c y d r i v e n b y e m e r g e n t t e c h n o l o g y

W o r k s p a c e C a s e S t u d y 2 0 1 5C h a r l e s B e l l e a n d K at h i e C h u a n g

Startup Policy Lab is a �scally sponsored project of Community Initiatives – a 501c3 nonpro�t organization

Startups live, work, and play in workspaces all over the world.

HackerSpaces, a community generated wiki, lists over 350 workspaces in the united states

hackerspaces.com

WorkSpaces are increasingly centers of startup activity, so we wondered:

W H Y D O S TA R T U P S S E L E C T O N E W O R K S P A C E O V E R A N O T H E R ?

W H A T A R E T H E C A P I TA L N E E D S S TA R T U P S I N W O R K S P A C E S H AV E ?

H O W L O N G W I L L T H E S TA R T U P S U S E A W O R K S P A C E ?

80 startups

>200,000 Data points

W E C O N D U C T E D O N E O N O N E I N T E R V I E W S :SPL spoke with 82 startups using a 10 question survey.

L E V E R A R G E D S E C O N D A R Y D A TA S O U R C E S :One workspace partner shared >200,000 data points related to membership activity.

W E E N G A G E D I N I N D E P E N D E N T R E S E A R C H :SPL collected third party data about startups from Angel List and Crunchbase.

We started by comparing two workspaces

L e a r n the best ways to collect data about the dynamic startup community

C o m p a r e two di�erent types of workspaces to surface initial patterns and di�erences

B e t t e r u n d e r s ta n d the characteristics of startups within workspaces

D e t e r m i n e if there is su�cient support to launch an annual and more robust study

our goal was to develop the foundation for more in-depth research

W E F O U N D P A T T E R N S , T A K E A W A Y S , A N D I D E A S F O R

H O W T O E X P A N D T H I S P R O J E C T G O I N G F O R W A R D

L o c at i o n w a s t h e p r i m a r y f a c t o r f o r s e l e c t i o nNearly 50% of startups surveyed the workspace chose it because of its location.

F u n d i n g n e e d s w e r e at t h e s e e d s ta g eMedian funding was just $1MM.

C o m p a n i e s h a d t r a c t i o n ( c u s t o m e r s ) a n d b u s i n e s s m o d e l sMedian age of startups was 30 months.

H i g h e x p e c tat i o n o f c h u r nAt one workspace, the median time in residence was 9 months; and the

total length of time startups expected to stay was 17 months.

Patterns we found in both workspaces

B u i l d t o l o c at i o n : s u p p o r t e x i s t i n g c o m m u n i t i e sStartups gravitate to each other and spaces that have other startups. Building a supportive ecosystem means going to that community, not building a workspace to locate a startup community in a particular location to drive outside capital investment.

B r i n g i n t h e A n g e l s : Ta r g e t s e e d f u n d i n g f o r e a r ly s ta g e s ta r t u p sStartups in workspaces are likely to be smaller and at the seed stage. As a result, these startups, for the most part, are not ready for venture capital. A robust Angel Investor community will provide great impact for seed stage startups.

T h i n k l o c a l & g l o b a l : s at e l l i t e o f f i c e s a r e va l u a b l e a d d i t i o n s t o w o r k s p a c e sWhile it is important to support local startups, companies seeking to locate their satellite o�ce in a workspace o�er great bene�ts to local startups. Satellite o�ces of established startups from outside a region provide stability, bring in outside capital, and ideas that local startups can leverage.

Three insights emerged

1 2 3

W o r k s p a c e r e s o u r c e g u i d e Create an online resource with information about types of workspaces.

A n a ly t i c t o o l s Enable workspaces (startups, investors, policymakers & workspaces) to compare performance metrics of workspaces.

P a r t n e r w i t h t h i r d p a r t y d ata e x p e r t s Collaborate with Angel List and Mattermark to build automated collection of granular data about startups.

Next steps to increase the value of our research

I n c r e a s e t h e n u m b e r o f d ata p o i n t s Another year with our partners and add (1) more partner.

i n c r e a s e f r e q u e n c y o f d ata c o l l e c t i o n Collect data on a quarterly basis.

S t r u c t u r e d ata Structure data to make it more consistent across workspaces.

R e s e a r c h f u n d i n g Raise funding to continue this initiative.

O U R A P P R O A C H : S P L C O L L A B O R A T E D W I T H T W O

W O R K S P A C E S ( S A N F R A N C I S C O & S I L I C O N V A L L E Y )

P a r t n e r s h i p s Two workspaces (Runway & Hacker Dojo) provided access to their community, promoted the survey, and shared their data.

T i m e p e r i o d Research and data collection occurred between July 2015 - Sept 2015.

R e s e a r c h M e t h o d o l o g y Conducted in person surveys, analyzed member check-in data, and pulled secondary research.

D ata c o l l e c t e d • Total number of startups surveyed: 80 (Runway: 39, Hacker Dojo: 41)

• Total number of survey respondents: 114

What we did: surveys and research

(Runway: 49, Hacker Dojo: 65)

• Total number of members at Hacker Dojo: 479

• Total number of member check-in data points collected: 215,253

• Type of check-in data collected: name, date of check-in, & time of check-in

T h i r d p a r t y d ata Collected information about participating startups from Angel List & Crunchbase, including funding, location, and company type.

e x p e r t i s e Support provided by data science partner Datable.

Our Awesome Workspace partners

For - Pro�t Non - Pro�t

Member, month to month, pay for access to desks

479 members

hackerdojo.com

Company, month to month, pay for individual desks

80 companies

runway.is

B u s i n e s s m o d e l

P ay m e n t m o d e l

2012 2009

Mountain Veiw, CASan Francisco, CA

Y e a r f o u n d e d

L o c at i o n

“World's Largest Non-pro�t Community Hackerspace”

“Runway is a community and co- working space for entrepreneurs,

in�uencers, and hustlers”D e s c r i p t i o n

n u m b e r o f c o m p a n i e s / m e m b e r s

W e b s i t e

W E F O U N D P A T T E R N S , T A K E A W A Y S , A N D I D E A S F O R

H O W T O E X P A N D T H I S P R O J E C T G O I N G F O R W A R D

T h e s u r v e y w a s s tat i c , w h i c h r e d u c e d t h e d e p t h o f i n s i g h t.There is a high rate of churn of startups at workspaces. The survey only provides a snapshot of a moment in time.

L i m i t e d f i n a n c i a l r e s o u r c e s p r e v e n t m o r e r o b u s t d ata c o l l e c t i o n a n d a n a ly s i s .Robust research requires additional funding to create and maintain infrastructure for data collection and analysis.

D ata a c c u r a c y I s h e av i ly d e p e n d e n t o n s e l f - r e p o r t e d d ata .Data collected was not standardized; proprietary tools might be able to provide more structure and accuracy, e.g. Mattermark.

A few (massive) caveats about our approach

M e m b e r / c o m p a n y t i m e c y c l e i n i n n o vat i o n s p a c e

B u i l d t o l o c at i o n : s u p p o r t e x i s t i n g c o m m u n i t i e sStartups gravitate to each other and spaces that have other startups. Building a supportive ecosystem means going to that community, not building a workspace to locate a startup community in a particular location to drive outside capital investment.

B r i n g i n t h e A n g e l s : Ta r g e t s e e d f u n d i n g f o r e a r ly s ta g e s ta r t u p sStartups in workspaces are likely to be smaller and at the seed stage. As a result, these startups, for the most part, are not ready for venture capital. A robust Angel Investor community will provide great impact for seed stage startups.

T h i n k l o c a l & g l o b a l : s at e l l i t e o f f i c e s a r e va l u a b l e a d d i t i o n s t o w o r k s p a c e sWhile it is important to support local startups, companies seeking to locate their satellite o�ce in a workspace o�er great bene�ts to local startups. Satellite o�ces of established startups from outside a region provide stability, bring in outside capital, and ideas that local startups can leverage.

S U R V E Y F I N D I N G S P R O V I D E A C O M P A R I S O N O F F O R P R O F I T

W O R K S P A C E V E R S U S A N O N - P R O F I T W O R K S P A C E

M e m b e r / c o m p a n y t i m e c y c l e i n i n n o vat i o n s p a c e

How long are the startups in the space and how old are they?

R u n w ay

Av e r a g e : 10.87 Months

M e d i a n : 9.00 months

S ta n d a r d d e v i at i o n : 1 1 . 4 1

Av e r a g e : 10.03 Months

M e d i a n : 8.00 months

S ta n d a r d d e v i at i o n : 7 . 8 5

H a c k e r D o j o

Workspaces are perceived as temporary o�ces.Most startups have been in the workspace for less than a year.

Funding AmountFunding Amount

Num

ber o

f Com

pani

es

Num

ber o

f Com

pani

es

$0 to $500,000

$500,000 to $1M

$1M to $1.5M

$1.5M to $3M

$3M +

what level of funding do these startups have?

O U R A P P R O A C H : S P L C O L L A B O R A T E D W I T H T W O

W O R K S P A C E S ( S A N F R A N C I S C O & S I L I C O N V A L L E Y )

R u n w ay H a c k e r D o j o

The majority of the startups were, unsurprisingly, at the seed stage. The vast majority of startups had raised less than $500,000.

23

4 5 4 3

43

5 1 1 1

events/programs 22%

mentors/networking 9%

funding/capital 8%

price point 4%

location 53%

collaborative space 4%

events/programs 22%

equipment135

location 53%

investor link 14%

mentors/networking 25%

Why do startups select a particular workspace

R u n w ay H a c k e r D o j o

LOCATIONLocation was overwhelmingly important in the work space at nearly 63%.

LOCATIONImportant in the makerspaces as well as the workspace. Location accounts for 28% of the appeal of the space.

MENTORS AND NETWORKINGRefers to the availibility of mentors and networking oppertunities in the given space.

A D E E P E R D I V E I N T O T H E I N D I V I D U A L W O R K S P A C E S

R U N W A Y I N C U B A T O R I S A F O R - P R O F I T W O R K S P A C E

L O C A T E D I N S A N F R A N C I S C O ( T W I T T E R B U I L D I N G )

B2C

B2B

HQ

Satelite

Software

Hardware

46%54%

31%

69%

10%

90%

90% of the startups in a general purpose workspace are in software.

B2C and B2B are equally represented, but satellite o�ces are 30% of residents.

companies @runway have clear characteristics

S U R V E Y F I N D I N G S P R O V I D E A C O M P A R I S O N O F F O R P R O F I T

W O R K S P A C E V E R S U S A N O N - P R O F I T W O R K S P A C E

b 2 c v s b 2 b c o m p a n i e s

h q v s s at e l i t e

H a r d w a r e v s S o f t w a r e

events/programs

mentors/networking

funding/capital

location

price point

collaborative space

Why did the company choose runway

5%5%

47%

7%

16%

20%

S ta r t u p s c h o s e R u n w ay p r i m a r i ly b a s e d o n l o c at i o n

Twitter

Square

Uber

$2.84M

$1.OM

$4.75M

How much capital have companies at runway raised?

M E D I A N F U N D I N G O B TA I N E D

AV E R A G E F U N D I N G O B TA I N E D

S TA N D A R D D E V I A T I O N

A few companies skew the data higher.The vast majority of companies have raised less than $1M — most, in fact, have raised less than $500k.

The majority of the startups were, unsurprisingly, at the seed stage. The vast majority of startups had raised less than $500,000.

events/programs 22%

mentors/networking 9%

funding/capital 8%

price point 4%

location 53%

collaborative space 4%

What are The average and median length of time companies are located at runway?

Expect high levels of churn at workspaces. Startups perceive workspaces as a temporary location; with plans to stay for less than two years.

48.23

30.00

52.25

10.87

9.00

11.41

18.44

17.00

14.07

T o ta l T i m e S i n c e C o m p a n y

F o u n d i n g ( m o n t h s )

Av e r a g e

M e d i a n

S ta n d a r d

d e v i at i o n

T o ta l T i m e i n R u n w ay

C u r r e n t ly ( m o n t h s )

T o ta l T i m e E s t i m at e d t o

B e i n R u n w ay ( m o n t h s )

H A C K E R D O J O I S a N O N - P R O F I T W O R K S P A C E

L O C A T E D I N M O U N T A I N V I E W

Why did the company choose hacker dojo?

22

17

17

43

99

17

22

17

24

80

22

29

25

57

133

13

24

14

32

83

18

26

24

46

114

Regardless of the length of time companies expected to spend at Hacker Dojo, Location was the number one reason for being there.

L e n g t h o f t i m e

M e m b e r P l a n n e d t o

s tay at H a c k e r D o j o

E v e n t s &

p r o g r a m s

0 - 3 m o n t h s

4 - 6 m o n t h s

6 - 1 2 m o n t h s

1 2 + m o n t h s

T o ta l

E q u i p m e n t L i n k s t o

i n v e s t o r s

m e n t o r s &

n e t w o r k i n g

L o c at i o n

R U N W A Y I N C U B A T O R I S A F O R - P R O F I T W O R K S P A C E

L O C A T E D I N S A N F R A N C I S C O ( T W I T T E R B U I L D I N G )

1-2 members

2-3 members

3-5 members

5-7 members

>7 members

Where hacker dojo members live based on zip code

What is the funding stage and size of companies at the hacker dojo?

$0 - $50,000 1 - 2

2 - 4

2 - 5

3 - 5

$50,000 - $550,000

$230,000 - $810,000

$260,000 - $610,000

Length of time at Hacker Dojo does not necessarily indicate more funding.

L e n g t h o f t i m e

m e m b e r p l a n n e d

t o s tay at

H a c k e r D o j o

av e r a g e f u n d i n g

0 - 3 m o n t h s

3 - 6 m o n t h s

6 - 1 2 m o n t h s

1 2 + m o n t h s

“ l o w e s t i m at e t o h i g h e s t i m at e ” “ l o w e s t i m at e t o h i g h e s t i m at e ”

av e r a g e c u r r e n t c o m p a n y s i z e

Thank you

G E N E R A L I N Q U I R I E Sinfo@startuppolicylab.org

S U P P O R T O U R W O R Kcharles@startuppolicylab.org

A few companies skew the data higher.The vast majority of companies have raised less than $1M — most, in fact, have raised less than $500k.

@StartupPolicy

StartupPolicyLab

S P L H E A D Q U A r T E R S1355 Market Street, 4th �oor, San Francisco, CA, 94103

The people behind this project

C H A R L E S B E L L E

K A T H I E C H U A N G

D A TA P A R T N E R

CEO, Startup Policy Lab charles@startuppolicylab.org

Intern, Startup Policy Lab kathie@startuppolicylab.org

DatableApp team on the 1’s and 0’s.

We love startups and they are awesome.

lull@datableapp.com