On-demand office space saves on costly overheads and provides a capital base to do business in London
It’s an incredible time to run a business. Entrepreneurs are spoilt for choice with new ways of working and flexible on-demand services which can be accessed when they are needed.
Data storage services such as Dropbox and Google Drive cost a pittance, and can be expanded in step with demand. Web-hosting is similar; you outsource hosting to a specialist and only pay for the traffic your site generates. This way there are no hardware bills.
Using on-demand services can supercharge performance. Instagram grew to a billion-dollar company with just 13 employees by making the most of on-demand services. Fashion retailer Net-a-Porter.com is a fanatical user, utilising Amazon Web Services for hosting and Salesforce.com for enterprise planning. It’s the only way to be truly agile, the company claims.
There is manpower as a service, through Upwork and Freelancer.com. Transcription services such as Rev.com are replacing in-house secretaries. And accountancy software-as-a-service is now mainstream with Xero and Sage One.
Uber offers on-demand transportation so cheap and convenient it’s undermining the concept of car ownership. Airbnb offers travellers a new realm of accommodation to explore. Hotels full for the big game? No matter – stay in an Airbnb.
So what’s next in the on-demand world? Office space is the obvious target. Rental asking prices for office space are at record levels, particularly in central London, companies are desperate for ways to rethink their use of space.
And the number-one solution is to treat office space as a service, just like Dropbox and Xero. Companies either rent office space when they needed it (short term) or lease a serviced office (medium term). This ends the absurd scenario of paying for space which is underused and allows businesses to expand as they grow. But what about longer-term, flexible alternatives?
The City of London Corporation has hailed the move to on-demand office space as a major contributor to UK prosperity. In a detailed report, the corporation noted multiple advantages including lower running costs, enhanced flexibility and access to a wide variety of site types in terms of quality. The expense and risk of taking long-term contracts for office space are gone.
The corporation flagged up two important observations. The first is that 30 per cent of the flexible office market is taken by larger corporates. It’s not just a strategy for startups, and small and medium-sized enterprises. The second remarkable fact is the length of stay. The report points out: “A perhaps unexpected finding here has been the stability and maturity of many serviced office occupiers, with an average length of stay of 18 to 24 months, in some cases ranging up to a period of three to five years.”
Adam Blaskey is one of the pioneers in the sector. He was a residential property developer who became tired of meeting clients in hotel lobbies and coffee shops. So he founded The Clubhouse to accommodate professionals and businesses of all shapes and sizes, from startups to blue chips that needed a central-London base from time to time to hold meetings and work.
Today, The Clubhouse offers two prime locations in Mayfair, with 250 companies signed up, and is about to open a new flagship on St James’s Square.
“Many think that spaces such as ours are for startups and early-stage businesses, and while this is true to an extent, the vast majority of our members are well-known blue-chip names, including the likes of Grosvenor, Tesla and Samsung,” says Mr Blaskey. “They may have an office outside London and need somewhere suitable to meet clients or they might have a London presence, but need some extra space from time to time.”
The Clubhouse has a growing number of converts to the on-demand model, not just entrepreneurial nomads and freelancers, but a host of well-established global names
Like Dropbox, the pricing model radically reduces costs. Annual membership starts from only £950 a year for infrequent access, rising to £3,850 for more complete access. Corporate memberships are also available, giving larger teams a place to call home when they are in the capital.
The model means companies can make use of open-plan meeting areas, private boardrooms, hot desks and a members’ lounge, and even host events, in Mayfair and St James’s, for a fraction of the normal cost.
In fact, the savings go further than the headline numbers. Companies often use coffee shops as a primitive form of on-demand office space. Research shows companies are spending £5,824 a year on taxis, coffee, snacks, newspapers and other costs when using improvised spaces. Switching to a smarter alternative space such as The Clubhouse, where coffee and other amenities are included, avoids this pointless expense.
The Clubhouse has a growing number of converts to the on-demand model, not just entrepreneurial nomads and freelancers, but a host of well-established global names. All of whom benefit from the flexibility and convenience they need, supported by a dedicated team when in London. The City of London Corporation predicts the strengths of the model will mean the sector will double in size, at least, in the next ten years.
“Like software on demand, meeting and workspace on demand makes you more nimble and agile, therefore allowing your business to grow quickly and reduce overheads at the same time,” says Mr Blaskey. “It works for companies of all sizes and all sectors. And if it’s just ad-hoc use for a business traveller in London, you don’t have to be a member to use our meeting rooms and can join The Clubhouse just for the day.”
“For entrepreneurs and companies who do business in London and need space – flexible meeting space – on demand, The Clubhouse offers the perfect solution.”