Soon after launching Been There, Done That, we heard from many of you that you wanted more — more coaching, more resources, and more access to the network of entrepreneurs PivotDesk has built.
So, we started to host events designed to give you just that…more!
Rather than limit the benefits of these events to attendees only, we’ll be sharing the key insights we covered live, right here on the blog.
Keep an eye out for more PivotDesk event recaps coming soon.
A panel of entrepreneurs in the commercial real estate tech space, breaking down the top mistakes startups make on their search for the right home for their team.
Our recent CRE/Tech meetup featured panelists from Compstak, TheSquareFoot, and WiredScore. The founders focused on teaching attendees both the most important lessons they have learned regarding the search for commercial real estate, as well as some valuable advice on growing a business — often learned the hard way.
What are some mistakes startups make when they are looking for a new office space?
Jonathan Wasserstrom, CEO and Co-founder of TheSquareFoot, explained that often times, entrepreneurs see themselves as disrupting the [x] market, giving them a sense of false bravado. Then, they enter the commercial real estate industry looking for space for their business, and expect the landlord to see them as a big shot — the way they are seen in their own industry. Unfortunately, they usually end up getting a rude awakening that all people don’t cave to them in the real estate world as they do in their startup community. As a startup, definitely do your research, but don’t speak as though you should be given special treatment, it will just make it that much harder to find space.
Michael Mandel, CEO and Co-founder of Compstak was a broker prior to the founding of CompStak. He piggybacked off of Jonathan’s point on the level of arrogance around entrepreneurs and startups, stating: “Entrepreneurs dislike having a broker involved in the real estate process. Many entrepreneurs are in the business of weeding out the ‘middle man’ to help the end consumer and cut costs. In their eyes, the broker is nothing more than a middle man. A major benefit to having a broker, is to break down and help with legalities between the tenant and the landlord. When trying to understand lease provisions, the tenant will not have proper knowledge on their own. A lot of value is added using a broker in your process.”
With all the complications and stress of signing a lease, why not use an office sharing service like PivotDesk or Co-working spaces?
David Mandell, CEO and Co-founder of PivotDesk explained his thought process: by saying simply: “Work backward from your end goal.” He explained that you need to ask yourself important questions pertaining to your goals such as,‘Is space important to my business? Do I need to be close to my customers? Do I want to be surrounded by people? Am I ready for my own space?’ and work from there. Not all startups are the same. Their office space needs differ among growth stages, industries and locations. While sharing works in most situations, it is not always the best fit.
Can you share how you built your sales team, and some important tips in doing so?
Arie Barendrecht, CEO and Co-founder of WiredScore started off explaining that his background is not in commercial real estate. Initially, he made a lot of assumptions around how quickly brokers and landlords were willing to evolve with technology. At first, in his sales process, people were quick to question his credibility due to his lack of experience in the commercial real estate industry. Once he decided to recruit people from the CRE industry, he found that clients were much more willing to work with WiredScore. “That completely changed the narrative of our business development,” he explained.
Michael Mandel went on to say that he does not believe you should build a sales team on day one, adding “I can’t claim that we cracked the code on this, but I do know that if you are the CEO of the company, it is your job to be the sales team until you figure out whether your product works, and how it needs to be sold.” He went on to explain that the CEO must have an understanding of all the objections of their business, and how to handle them. One of the biggest mistakes CompStak made was growing the sales team too big, too early. He explained that they got a bunch of name-brand landlords on board initially, and had the false belief it would be that easy throughout the growth of their business. Michael admitted that he quickly found out this was not the case.
David agreed with Michael stating that when PivotDesk first started, he went door to door and shook hands. He asked companies if they would be willing to pay for the service PivotDesk is providing. The founders made sure that the concept would work, well before any code was ever written. David also mentioned the importance of understanding the life cycle of a sales process. He explained that the sales process will change, especially as the product and the team evolve. It is imperative that the company’s sales tactics evolve with the rest of the business. In short, he explained, “The CEO always needs to be thinking about the sales strategy, regardless of what sales hires are made.”
How do you decide timing and best practices for giving employees stock options?
Jonathan told that crowd that when he and his team were setting up TheSquareFoot’s stock option policy, they decided that it was best for everyone working at TheSquareFoot to have some ownership. He explained that every employee has a percentage. It may not always be a meaningful percentage, but there is still a sense of ownership. He also mentioned the traditional 4 year vesting schedule with a 1 year cliff is a great standard to use. This means that if an employee leaves before the first year, their stock options are terminated.
Ari explained that his team decided that it was best to follow industry standard rules for the stock options at WiredScore as well. He also encouraged fellow founders to see what worked best for their individual companies, as it’s not something that she be treated as a one-size-fits-all solution.
David mentioned that the amount of stock companies choose to give employees is entirely their call, but that they should be consistent across the company given their positions. Overtime high performers may earn more equity, so what is initially given is not set in stone.
Need help navigating the NYC commercial real estate scene? We’ve got a wide range of services available to fit any business’s needs.
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