Annual Membership
67 views
Skip to first unread message
Wes
Apr 22, 2012, 8:23:18 AM4/22/12
to Coworking
We've been flirting with the idea of switching to, or at least
including, an annual membership model at The coIN Loft. I did a quick
search and didn't see any discussions about it here. Has anyone tried
it before?
including, an annual membership model at The coIN Loft. I did a quick
search and didn't see any discussions about it here. Has anyone tried
it before?
Tom Brandt
Apr 22, 2012, 5:34:51 PM4/22/12
to cowo...@googlegroups.com
I'm curious why you are considering this?
--
You received this message because you are subscribed to the Google Groups "Coworking" group.
To post to this group, send email to cowo...@googlegroups.com.
To unsubscribe from this group, send email to coworking+...@googlegroups.com.
For more options, visit this group at http://groups.google.com/group/coworking?hl=en.
twb
member, Workantile
@twbrandt
Will Bennis, Locus Workspace
Apr 23, 2012, 5:09:55 AM4/23/12
to Coworking
Our standard prices are based on a 6 month membership commitment. For
any membership less than six months, we charge 20% more. If you pay
for your entire 6 month membership up front, we give a 15% discount on
the standard price. If you pay for an entire year up front, we give a
25% discount. We used to also charge less for a year-long commitment
(without needing to pay it up front), but stopped just for the sake of
keeping things simpler (and there's still an argument for simplifying
it more).
We provide discounts for both long-term commitments and for paying up
front for several reasons:
1) Cash flow. This only applies to the long-term memberships where the
people pay up front. It's nice to have the money now as we're a young
business and need the money to pay bills. As the space grows in the
future, that lost future income is not so crucial.
2) For better and for worse, financial gain: People who sign a long-
term contract are much more likely to stick with the space than those
who don't. Even if they don't stick with using the space, most of them
keep paying according to their contract, playing a big role in my
ability to keep prices as low as they are and stay in business. The
incentive for paying for it all up front adds to this, since that
group always pays for the entire term of the contract, while some
small percentage of members who commit long-term but don't pay it all
up front don't ever end up paying.
3) I prefer longer-term members for the sake of the community, and so
giving an incentive for a longer commitment seems to make sense.
4) Paperwork and associated time: I need to spend a great deal less
time on paperwork and organization on members who renew every year
than I do on members who renew every month.
5) It allows us to charge lower prices (for longer term commitments)
than we would otherwise be able to charge, making the space more
accessible to a lot of people who wouldn't otherwise be able to afford
it. This is important to me since part of my motive for creating this
kind of business was to help graduate students and people venturing
into freelancing for the first time, people who often can't afford a
lot for a workspace, and only with something like this (along with a
strong incentive for hotdesking over anchor desking) can I keep the
prices low enough.
6) Fair pricing: We reward contracts that make the space more
economically sustainable. To me it's a no-brainer that a 12 month
commitment adds more net income to the space (per month) than a one
month commitment (on average). If a long-term commitment is more
valuable to the space owner and more costly to the members, why charge
the same for each type of commitment?
There are some down sides, too, of course: Primarily related to # 2 &
#6: The business model creates incentives for me as a business owner
that I don't want: as with a gym model, the hope that people who
commit long-term don't end up using the space as much as they'd
planned when they signed up so that I can get more members per desk.
That's directly contrary to my main mission of helping people do their
work-related best. Also, if members are unhappy after they'd worked
here for a while, it's a shame if they feel locked in to something
they don't want. And it's bad for me to have someone locked into a
long-term contract who may be detracting from the quality of the
space. It makes it a LOT easier to tell a member that they're not the
right kind of person for the space if their contract expires at the
end of the month than if it expires in 8 months.
I get around most of the downsides, or try to get around them, by
reminding myself of the mixed motives as much as I can, keeping them
explicit so the wrong reasons (given my own reasons for doing this)
don't start to guide my actions or thinking. I don't push the long-
term memberships and I'll let people out of it with reasonable
penalties if they have a good reason for wanting to get out of the
contract or if they're detracting from the quality of the space.
Overall, it has worked great, IMO, and it's something I have found
almost zero reason to consider changing so far. I often wonder why so
many coworking spaces seem committed to charging the same for month-to-
month memberships as it seems to me to make so little sense from a
cost/profit perspective, and I don't see the difference in pricing as
contrary to coworking values. The members like the option (I couldn't
offer those lower prices if it wasn't tied to the longer-term
commitment), and it add cash flow and revenue that makes coworking
more economically sustainable.
Will
> member, Workantile <http://workantile.com/>
> @twbrandt
any membership less than six months, we charge 20% more. If you pay
for your entire 6 month membership up front, we give a 15% discount on
the standard price. If you pay for an entire year up front, we give a
25% discount. We used to also charge less for a year-long commitment
(without needing to pay it up front), but stopped just for the sake of
keeping things simpler (and there's still an argument for simplifying
it more).
We provide discounts for both long-term commitments and for paying up
front for several reasons:
1) Cash flow. This only applies to the long-term memberships where the
people pay up front. It's nice to have the money now as we're a young
business and need the money to pay bills. As the space grows in the
future, that lost future income is not so crucial.
2) For better and for worse, financial gain: People who sign a long-
term contract are much more likely to stick with the space than those
who don't. Even if they don't stick with using the space, most of them
keep paying according to their contract, playing a big role in my
ability to keep prices as low as they are and stay in business. The
incentive for paying for it all up front adds to this, since that
group always pays for the entire term of the contract, while some
small percentage of members who commit long-term but don't pay it all
up front don't ever end up paying.
3) I prefer longer-term members for the sake of the community, and so
giving an incentive for a longer commitment seems to make sense.
4) Paperwork and associated time: I need to spend a great deal less
time on paperwork and organization on members who renew every year
than I do on members who renew every month.
5) It allows us to charge lower prices (for longer term commitments)
than we would otherwise be able to charge, making the space more
accessible to a lot of people who wouldn't otherwise be able to afford
it. This is important to me since part of my motive for creating this
kind of business was to help graduate students and people venturing
into freelancing for the first time, people who often can't afford a
lot for a workspace, and only with something like this (along with a
strong incentive for hotdesking over anchor desking) can I keep the
prices low enough.
6) Fair pricing: We reward contracts that make the space more
economically sustainable. To me it's a no-brainer that a 12 month
commitment adds more net income to the space (per month) than a one
month commitment (on average). If a long-term commitment is more
valuable to the space owner and more costly to the members, why charge
the same for each type of commitment?
There are some down sides, too, of course: Primarily related to # 2 &
#6: The business model creates incentives for me as a business owner
that I don't want: as with a gym model, the hope that people who
commit long-term don't end up using the space as much as they'd
planned when they signed up so that I can get more members per desk.
That's directly contrary to my main mission of helping people do their
work-related best. Also, if members are unhappy after they'd worked
here for a while, it's a shame if they feel locked in to something
they don't want. And it's bad for me to have someone locked into a
long-term contract who may be detracting from the quality of the
space. It makes it a LOT easier to tell a member that they're not the
right kind of person for the space if their contract expires at the
end of the month than if it expires in 8 months.
I get around most of the downsides, or try to get around them, by
reminding myself of the mixed motives as much as I can, keeping them
explicit so the wrong reasons (given my own reasons for doing this)
don't start to guide my actions or thinking. I don't push the long-
term memberships and I'll let people out of it with reasonable
penalties if they have a good reason for wanting to get out of the
contract or if they're detracting from the quality of the space.
Overall, it has worked great, IMO, and it's something I have found
almost zero reason to consider changing so far. I often wonder why so
many coworking spaces seem committed to charging the same for month-to-
month memberships as it seems to me to make so little sense from a
cost/profit perspective, and I don't see the difference in pricing as
contrary to coworking values. The members like the option (I couldn't
offer those lower prices if it wasn't tied to the longer-term
commitment), and it add cash flow and revenue that makes coworking
more economically sustainable.
Will
> @twbrandt
Wes
Apr 24, 2012, 8:23:39 AM4/24/12
to Coworking
Thanks for your comments, Will. Reason #3 is exactly why I'm
considering the switch. The reason I'm thinking about changing our
cost structure isn't really a cash flow issue, as most people that
join our space do so at our highest rate, and stick around for 7 - 8
months, which is actually really good for where we're located - it
needs to be much better though. As a space focused primarily on
supporting the (slow) growing Delaware startup community, we're very
happy to provide people with a safe place to get on their feet. Even
better, the majority of the startups that have come out of The coIN
Loft found co-founders at our events or working next to them in the
space. We're certainly building up a great story.
The other side:
Delaware has always been starved for independent talent, which is
obviously bad for a coworking space. We have a deep history as a
corporate state, so most people that come here to build a career are
doing it at legacy companies, in the banking, pharma and law related
industries. With Delaware being such a small state the lines of
competitiveness have been thoroughly entrenched for many years - way
before The coIN Loft came around. There are a few non-profit
professional organizations (chambers of commerce, rotary groups,
networking groups) and economic development groups (sba & its
affiliates) that rule over the entrepreneurial community here. These
places aren't communities - they're bragging rights - so you're a
nobody as a professional if you don't join their circles. Despite all
of our PR and marketing efforts, we've struggled to compete with these
groups. We consistently hear that the month-to-month membership fee is
a deterrent. The other groups, specifically the Chambers of Commerce,
who we're in direct competition with, charge a annual fee, plus fees
for every event. For the penny wise entrepreneur, they're looking at
either $300 per year for the Chamber or $2400 per year for us. It
doesn't take much to see why they'd be slow to choose us. We've
tracked the average time it took a person to join us and found that of
the 80 people that have joined, over 50% thought about it for more
than 5 months before pulling the trigger. They also let us know that
the monthly payments were an issue. I don't think we need to be as
cheap as $300 per year, nor do I think people are expecting that. I
just think we need to disassociate monthly financial requirements as a
barrier to entry. The main reason is that our target audience
(creatives & developers within the first year (hopefully first couple
of months) of their startup) aren't cash flow positive yet. The money
they're using to pay us is also coming out of the reserves they have
to live on until they're financially stable.
I think a fee structure like the one you (Will) use at Locus would
certainly be a good way for us to be thinking about annual
memberships.
On Apr 23, 5:09 am, "Will Bennis, Locus Workspace"
considering the switch. The reason I'm thinking about changing our
cost structure isn't really a cash flow issue, as most people that
join our space do so at our highest rate, and stick around for 7 - 8
months, which is actually really good for where we're located - it
needs to be much better though. As a space focused primarily on
supporting the (slow) growing Delaware startup community, we're very
happy to provide people with a safe place to get on their feet. Even
better, the majority of the startups that have come out of The coIN
Loft found co-founders at our events or working next to them in the
space. We're certainly building up a great story.
The other side:
Delaware has always been starved for independent talent, which is
obviously bad for a coworking space. We have a deep history as a
corporate state, so most people that come here to build a career are
doing it at legacy companies, in the banking, pharma and law related
industries. With Delaware being such a small state the lines of
competitiveness have been thoroughly entrenched for many years - way
before The coIN Loft came around. There are a few non-profit
professional organizations (chambers of commerce, rotary groups,
networking groups) and economic development groups (sba & its
affiliates) that rule over the entrepreneurial community here. These
places aren't communities - they're bragging rights - so you're a
nobody as a professional if you don't join their circles. Despite all
of our PR and marketing efforts, we've struggled to compete with these
groups. We consistently hear that the month-to-month membership fee is
a deterrent. The other groups, specifically the Chambers of Commerce,
who we're in direct competition with, charge a annual fee, plus fees
for every event. For the penny wise entrepreneur, they're looking at
either $300 per year for the Chamber or $2400 per year for us. It
doesn't take much to see why they'd be slow to choose us. We've
tracked the average time it took a person to join us and found that of
the 80 people that have joined, over 50% thought about it for more
than 5 months before pulling the trigger. They also let us know that
the monthly payments were an issue. I don't think we need to be as
cheap as $300 per year, nor do I think people are expecting that. I
just think we need to disassociate monthly financial requirements as a
barrier to entry. The main reason is that our target audience
(creatives & developers within the first year (hopefully first couple
of months) of their startup) aren't cash flow positive yet. The money
they're using to pay us is also coming out of the reserves they have
to live on until they're financially stable.
I think a fee structure like the one you (Will) use at Locus would
certainly be a good way for us to be thinking about annual
memberships.
On Apr 23, 5:09 am, "Will Bennis, Locus Workspace"
Toni Hogan
Apr 24, 2012, 10:09:45 AM4/24/12
to Coworking
Will, I know every area is different but I'll ask this question
anyway. Why are you in competition with any of the other organizations
rather than partnering with them? They have their thing and we have
ours. It properly meshed they should be complementary.
TH
anyway. Why are you in competition with any of the other organizations
rather than partnering with them? They have their thing and we have
ours. It properly meshed they should be complementary.
TH
Jeannine
Apr 25, 2012, 5:11:08 AM4/25/12
to Coworking
The only membership in Kamer52 that is explicitly annual (that is,
paid for annually) is for webshops and folks who primarily need an
address at the moment. This is really for administrative reasons, the
price is so low that it seems silly to send a bill every month. I
have been known to do it, and I have a...damn, what's the word?
Reseller? I have a listing with a website which wanted to offer it
monthly and so monthly it was.
All my other memberships are offered on a sliding scale with discounts
for longer term relationships, in 1 month (reatil) 6 month (discount)
and 12 month (wholesale) prices. The longest I have at the moment is
a 2 year contract. I tell prospective members right up front that
this is because I prefer longer trem relationships and because having
long term members reduces my recruitment and maintenance costs for new
ones, in both time and money.
What a lot of people do is to sign up for the bare-basics plan for a
year -- an address and a discount on use of the space -- and then when
this exceeds the cost of the standard monthly membership, they switch
over. For people who are in for a year, I charge them the bare-basics
or the standard, whichever is cheaper, based on their use from the
previous month. This is very popular. :-) Once people figure out how
that works, they have been known to book in the oncoming month early,
so they can get the lower price for a future month instead of based on
a past one (if that makes sense). This is particularly true of folks
who work on a project basis.
Also, I have a....er, in Holland there is a ticket for the bus called
a "strippenkaart". It is 10 bus fares on one ticket. So I have a
strippenkaart -- 10 at a discount, paid in advance just like the bus.
There is in principle no time limit on it. This is also popular for
people who work on a project basis -- I have an author who only uses
this plan, she has been known to use up a strippenkaart in two weeks
and then not come again for two months because of her own schedule.
This must all be considered against the background of my larger
community: this is a town which was 50K people when we started,
rapidly approaching the 60K mark. This is not a major city. People
in smaller communities generally do not value the ability to bail on
short notice in the same way -- I don't see a lot of people who want
to work in a rapidly shifting environment. They do appreciate the
flexibility of paying for what they use and not for what they might
use. It builds loyalty and community.
Later,
Jeannine
paid for annually) is for webshops and folks who primarily need an
address at the moment. This is really for administrative reasons, the
price is so low that it seems silly to send a bill every month. I
have been known to do it, and I have a...damn, what's the word?
Reseller? I have a listing with a website which wanted to offer it
monthly and so monthly it was.
All my other memberships are offered on a sliding scale with discounts
for longer term relationships, in 1 month (reatil) 6 month (discount)
and 12 month (wholesale) prices. The longest I have at the moment is
a 2 year contract. I tell prospective members right up front that
this is because I prefer longer trem relationships and because having
long term members reduces my recruitment and maintenance costs for new
ones, in both time and money.
What a lot of people do is to sign up for the bare-basics plan for a
year -- an address and a discount on use of the space -- and then when
this exceeds the cost of the standard monthly membership, they switch
over. For people who are in for a year, I charge them the bare-basics
or the standard, whichever is cheaper, based on their use from the
previous month. This is very popular. :-) Once people figure out how
that works, they have been known to book in the oncoming month early,
so they can get the lower price for a future month instead of based on
a past one (if that makes sense). This is particularly true of folks
who work on a project basis.
Also, I have a....er, in Holland there is a ticket for the bus called
a "strippenkaart". It is 10 bus fares on one ticket. So I have a
strippenkaart -- 10 at a discount, paid in advance just like the bus.
There is in principle no time limit on it. This is also popular for
people who work on a project basis -- I have an author who only uses
this plan, she has been known to use up a strippenkaart in two weeks
and then not come again for two months because of her own schedule.
This must all be considered against the background of my larger
community: this is a town which was 50K people when we started,
rapidly approaching the 60K mark. This is not a major city. People
in smaller communities generally do not value the ability to bail on
short notice in the same way -- I don't see a lot of people who want
to work in a rapidly shifting environment. They do appreciate the
flexibility of paying for what they use and not for what they might
use. It builds loyalty and community.
Later,
Jeannine
Will Bennis, Locus Workspace
Apr 25, 2012, 6:44:14 AM4/25/12
to cowo...@googlegroups.com
I like the 10 visit punch card idea a lot. We've lost a few potential members because we don't offer this option.
Will Bennis, Locus Workspace
Apr 25, 2012, 6:52:30 AM4/25/12
to cowo...@googlegroups.com
Hi Toni,
Can you add a sentence or two clarifying what you're referring to. I don't think I said anything about competition with other organizations.
Thanks,
Will
rachel young
Apr 25, 2012, 9:20:59 AM4/25/12
to cowo...@googlegroups.com
Jeannine,
Do you have a physical card for the strippenkaart? And if so, do you have any problems with fraud? And how do you manage the card?
r.
____________________
rachel young
rac...@camaraderie.ca
Find us in person:
Camaraderie
102 Adelaide St E 2nd Floor
Toronto, ON M5C 1K9
102 Adelaide St E 2nd Floor
Toronto, ON M5C 1K9
Be in business for yourself, not by yourself!
May 27, 2012 is the next FLCTO.
Stay in the know at http://bit.ly/freelancecampTO
Are you a coworking commitmentphobe?
for a day pass to seven spaces for one price.
Jeannine
Apr 25, 2012, 3:42:51 PM4/25/12
to Coworking
Hi, Rachel,
I originally made a physical card because I thought it was fun; I used
a hole punch to punch them. But I quickly found out that people who
like this plan think the physical card is fun to get but after the
first one prefer to skip it or to get an e-version because it's
annoying to have to remember it.
I have often thought that we ought to design an e-version of the
Coworking Visa that folks can show when they are visiting.
But in practice it's easier than it is in theory: Most of my members
book themselves in on the Google calendar and they have taken to just
putting "#5" or whatever in the "description" box to indicate which
number they are on; they like to get a bill for a new card at about
number 8 or so.
I don't know what kind of fraud I might encounter so I suppose I
haven't had any. Or I have had and I just missed it. :-)
Help me understand what you mean by "manage" the card? I send them a
bill for it. They pay it. At about # 8 or so I send them a bill for
a new one. If they pay it they can keep coming. If not then their
10th visit is their last one until they buy a new card.
Laters,
Jeannine
On Apr 25, 3:20 pm, rachel young <rac...@camaraderie.ca> wrote:
> Jeannine,
>
> Do you have a physical card for the strippenkaart? And if so, do you have
> any problems with fraud? And how do you manage the card?
> r.
>
> *____________________*
>
> *rachel young
> *rac...@camaraderie.ca
>
> *Find us in person:*
> *Find us online:*
> Website/blog <http://camaraderie.ca/> and
> Newsletter<http://bit.ly/camaraderienewsletter>
> Google+ <http://bit.ly/CamaraderiePlus>, Twitter<http://twitter.com/camaraderie>
> , Facebook <http://bit.ly/9zv3Fx>, and LinkedIn<http://bit.ly/CamaraderieGroup>
>
> *Be in business for yourself, not by yourself! *
> *May 27, 2012 is the next FLCTO. *
> *Stay in the know athttp://bit.ly/freelancecampTO<http://bit.ly/freelcancecampTO>
> *
>
> *Are you a coworking commitmentphobe? *
> *Try the Coworking Toronto Passport Program <http://bit.ly/CTOPassport2012>*
> *for a day pass to seven spaces for one price.*
> *
> *
I originally made a physical card because I thought it was fun; I used
a hole punch to punch them. But I quickly found out that people who
like this plan think the physical card is fun to get but after the
first one prefer to skip it or to get an e-version because it's
annoying to have to remember it.
I have often thought that we ought to design an e-version of the
Coworking Visa that folks can show when they are visiting.
But in practice it's easier than it is in theory: Most of my members
book themselves in on the Google calendar and they have taken to just
putting "#5" or whatever in the "description" box to indicate which
number they are on; they like to get a bill for a new card at about
number 8 or so.
I don't know what kind of fraud I might encounter so I suppose I
haven't had any. Or I have had and I just missed it. :-)
Help me understand what you mean by "manage" the card? I send them a
bill for it. They pay it. At about # 8 or so I send them a bill for
a new one. If they pay it they can keep coming. If not then their
10th visit is their last one until they buy a new card.
Laters,
Jeannine
On Apr 25, 3:20 pm, rachel young <rac...@camaraderie.ca> wrote:
> Jeannine,
>
> Do you have a physical card for the strippenkaart? And if so, do you have
> any problems with fraud? And how do you manage the card?
> r.
>
>
> *rachel young
> *rac...@camaraderie.ca
>
> *Find us in person:*
> *Find us online:*
> Website/blog <http://camaraderie.ca/> and
> Newsletter<http://bit.ly/camaraderienewsletter>
> Google+ <http://bit.ly/CamaraderiePlus>, Twitter<http://twitter.com/camaraderie>
> , Facebook <http://bit.ly/9zv3Fx>, and LinkedIn<http://bit.ly/CamaraderieGroup>
>
> *Be in business for yourself, not by yourself! *
> *May 27, 2012 is the next FLCTO. *
> *Stay in the know athttp://bit.ly/freelancecampTO<http://bit.ly/freelcancecampTO>
> *
>
> *Are you a coworking commitmentphobe? *
> *Try the Coworking Toronto Passport Program <http://bit.ly/CTOPassport2012>*
> *for a day pass to seven spaces for one price.*
> *
> *
rachel young
Apr 26, 2012, 1:43:11 PM4/26/12
to cowo...@googlegroups.com
Thanks.
I meant how do you administer the card, track who uses it, how they pay, when they pay, etc, essentially all of the things that you listed. Thanks for explaining.
Camaraderie
102 Adelaide St E 2nd Floor
Toronto, ON M5C 1K9
102 Adelaide St E 2nd Floor
Toronto, ON M5C 1K9
Be in business for yourself, not by yourself!
May 27, 2012 is the next FLCTO.
Stay in the know at http://bit.ly/freelancecampTO
Are you a coworking commitmentphobe?
for a day pass to seven spaces for one price.
Reply all
Reply to author
Forward
0 new messages