As we move further and further from traditional businesses–especially in the tech startup world–untraditional workspaces are gaining in popularity across the world. People who were once limited to working from home in their pajamas (I know it sounds attractive but, trust me, after a couple of weeks you’re ready to scratch your eyes out) or in coffee shops now have the option of “third spaces:” places that are located, conceptually, partway between the home and the office.
Areatres, with two locations in the trendy Palermo neighborhood of Buenos Aires, Argentina, are stellar examples of coworking spaces done right. Started by American expat Martin Frankel, areatres (the name translates to “third space”) is a vibrant, well-lit, perfect combination of professional and informal workspace. Offering everything from private offices that can hold entire small companies to a shared “living space” that provides opportunities for socializing and collaborating while you’re working, areatres fits the need of almost any professional who doesn’t want to be isolated but still needs to buckle down and get things done.
Martin and I had a great conversation about the benefits of coworking, what sets areatres apart, and the particular challenges of owning a business in a country you didn’t grow up in.
In your current life you’re a serial entrepreneur with a popular bar, Sugar, and areatres, but what did you do before you moved to Buenos Aires?
I spent almost 10 years in corporate America. After working for various companies, usually in sales and marketing, I figured it was time to make a change and I grabbed the savings that I had at that point and I came to Buenos Aires. That was the end of 2006.
I figured that there was more opportunity for a young 30 year old dude with a lot of ambition, a couple of ideas and a lot of energy in Buenos Aires than there might have been at that point in the US. I hoped I could take a risk there and hopefully be a little more unique.
Was Sugar your first venture into that sort of risk taking?
No, I actually started a company called Expat Connection. Expat Connection started in 2007 and basically it was an organization whose mission it was to help expats build a social network. We did this via different types of events that we hosted all over Buenos Aires. This was pre-Facebook and there were a large number English speaking expats from all over the world and they all had in common that they really loved Buenos Aires and were staying there for an undefined period of time but what they were lacking was connections to each other and the deeper connection to the city that you have through friendships and relationships with other people.
So I started this company, we hosted all kinds of events, and that led me to open Sugar and then to detect a need for a more professional workplace than a local coffee shop might be able to offer, which then evolved into areatres.
I was going to ask you what inspired you to start areatres, but it sounds like it was a process of being involved in the community in Buenos Aires, right?
Yeah, I mean, I personally have a philosophy that I’m only interested in getting involved in businesses where I’m the target market and I really understand what I, as the consumer, would want and can then extrapolate that and figure out that okay, there are more people like me. I know that if I could get this service that I can’t get or I would tweak a service a certain way, this is what I would want.
That was the case with areatres. I needed a place to work and I didn’t want to work from home and be isolated and bored and by myself. I was working out of coffee shops but I found that that only got me so far. It fulfilled the need of being around other people and that energy that you have being around other people, even if you don’t know them or talk to them.
For it me it was still a lot better than working from my house and being by myself but it only got me so far. I couldn’t print from that place, I couldn’t use that address on my business card, I couldn’t have a private conversation with somebody and talk about money or numbers or strategy in an open coffee shop sort of setting. It wasn’t that professional for some of the meetings I wanted to go into. I wanted something that was the next step.
At the same time, because of the nuances of Argentina, setting up your own private office is incredibly cumbersome and difficult. I’m not sure if you know, but to go rent a traditional office, that implies a three year lease. By law, office rentals in Buenos Aires are a three year minimum. Additionally, you have to put up a guarantee. And then you have all the additional costs of setting it up.
After all of that it’s like, great, you’ve got an office, but you’re back to the problem of damn, I’m all by myself and I want other people around.
I had seen shared workspace model in New York around 2000-something which was targeted to the tech sector and I figured something like that could really work in Buenos Aires.
Have you found that most of the businesses in your space are tech businesses? What’s the mix of businesses that come through?
There’s definitely a pretty high percentage of tech-based businesses. What all the businesses in areatres have in common is that they’re knowledge workers; they work with ideas. They’re putting strategies together, they’re creating content; either written or graphical or video. They’re putting ideas together, that’s what they’re producing, versus building physical items. They’re not building models unless they’re online. They’re not constructing homes or building automobiles, although they might be putting that structure together. The bulk of the businesses are web-based businesses, I think because the bulk of web-based businesses tend to be run by people who are open minded, young, or at least young-thinking.
But it’s not limited to digital businesses. We have a lot of people who work in sales or marketing for brands overseas and they may be independent. They have a need that, like I do, that they don’t want to be alone, working in an office, isolated. There’s a whole new generation of people that are from 25 to maybe 45 or 50 who understand the value of being comfortable in a workplace where there are other people around. The same people that are using Facebook all day and taking advantage of opportunities that LinkedIn brings them and are looking to build a network and thrive off that energy, those are the people who come to a solution like areatres.
When people come to check out the space, do you have a set a criteria for what you’re looking for or do you use your gut?
Well, I very much want to understand who they are, what they’re doing, and what they’re looking for. We have a pretty wide range of services that go from a fixed office to a fixed desk to access to an open, shared living space. Ninety-nine percent of people who work in areatres have never worked in that sort of environment before so they really don’t have a benchmark to understand what our service. It’s important for me to understand what they do and what they need for me to be able to suggest the appropriate service.
Also, it’s very important for me to understand whether or not that person may be a valuable addition to our community. Between the two areatres, we have a total of 11,000 square feet and almost 70 companies of varying sizes. One guy with mala onda (bad energy) sitting in the middle of that space really can transmit that throughout the whole space.
So I’m very protective of the community inside and I’m really not interested in the guy with a bad attitude who’s going to come in, regardless of whether he can pay for the service or not. That bad energy can be easily transmitted and I try to get a feel for people because I really would prefer to not have one more client who might be a sourpuss or just a mean dude. So yeah, there is a bit of screening process.
Do you have a business partner?
In areatres I have several business partners. They’re non-operational. They’re essentially investors but they’re all Argentine. They were very important in the startup of the business. Less so now because we’ve been around 3.5 years and pretty much have a good idea of what we’re doing.
But when we first started, I had never run a coworking space, much less run a business in Argentina. I mean, I had my experience with Sugar but that was only a year of experience prior to opening areatres and a tremendously different business. Areatres was a totally new category.
When I went to the city government we had to put our business in white and get all the permits and everything else that you need, it was very difficult for us to make the guy on the other side of the counter understand what my business was. It was like trying to explain to somebody, hey, this is email or this is the internet. The inter what? What are you talking about? What’s the internet? You open a machine and you can talk to people and download music, what are you talking about?
That was pretty much the response that I got from a lot of people regarding areatres. Yeah, it’s kind of an office but it’s kind of a club and we have a big living room area and it’s the halfway point between a traditional office and your home. People would kind of look at me like I was crazy, like what are you talking about. I essentially started distilling it down to, think of a hotel. It’s a work hotel. You go in, rent a space, and everything is set up for you.
How did you approach the design to areatres?
We did quite a bit of market research before we designed anything about what requirements individual small teams and businesses would have if they could design their ideal workplace.
One of the first things that was most important to people that we spoke with was a lot of natural sunlight, so that was very high on our priority list when we were looking for properties. And then based on some of the things we learned from speaking with dozens of people, we figured out what our requirements were for a space.
Security was very high on the list so I knew that I didn’t want to have a space that was retail space with a lot of glass so that everybody could look in the window and see what was going on on the other side. Our space is set back and not on the main street.
It was a combination of user feedback and what we would want if we were working at areatres. We’re young dudes in our mid-30s and we very much like contemporary style and contemporary furniture. We didn’t want a cluttered space; we wanted something pretty sober and simple. I very much wanted a lot of light and I wanted a bunch of plants around the space. I wanted a space I would feel comfortable in.
As someone who has been running and working in this space for awhile, do you have any coworking etiquette tips?
(Laughs) We’ve pretty much guided ourselves by a lot of common sense and, essentially, the Golden Rule: Do unto others as you would have done unto you. Luckily we haven’t had to enforce very much because people generally get it. When they come into the space, those that stick around generally understand that there’s a community of people working on their own individual projects or companies.
It’s been very rare that we’ve had to ask someone to quiet down a bit or use headphones on a Skype call or not bother the guy next to him or not to scream.
It’s been pretty much a self-regulating community. That was something I was concerned about in the beginning, that I would have to be the shush police or have to give people a rule book that they would have to read and sign but luckily that hasn’t been the case yet.
As long as people are relatively conscious of the fact that, hey, there are a bunch of other people here working on various things, in our experience thus far it’s been pretty self-regulating.