After Expanding To Boston, Cove Has Bigger Cities In Its Sights
When Cove launched its first location in Dupont Circle in fall 2013 as a workspace for freelancers and remote workers, it was focused on building a neighborhood-to-neighborhood network. Three years in, that focus has shifted to building a city-to-city network.
In September, Cove opened its first location outside of DC in Boston and is opening another one in Cambridge near MIT.
Founder and CEO Adam Segal, who we snapped yesterday while taking a tour of Cove's Chinatown location, says he plans to take the rest of this year to strengthen Cove's Boston presence and then expand to a third market next year. He hopes to use the lessons he learned from the DC and Boston launches to move to a bigger city—he is considering New York, San Francisco and Chicago.
"We always had the idea of scale," Adam says. "Having additional locations adds value. It adds even more value when you go to different cities, so when I'm in Boston, I get more locations and more people in my network."
Cove memberships work more like joining a gym than leasing an office. DC members pay $99 a month for unlimited access to its seven locations across the District, which have open desks and amenities like free coffee. Using a smartphone app, members can see how full each office is at any given time, reserve a conference room or network with other members.
Cove's locations are much smaller than other co-working spaces, typically less than 2k SF. While companies like WeWork and MakeOffices target startups, Cove attracts freelancers and employees working remotely who want to work somewhere more social than their living room, but more productive than a coffee shop.
"Fundamentally, we look at it a little bit differently," Adam says. "It's not about buying a dedicated desk for an office. At Cove it's not yours, you're buying into access for Cove locations and the network. It's really more about fitting into a lifestyle. We're not looking to be an office replacement, were looking to make your life more productive."
So while Adam doesn't see co-working companies like WeWork and MakeOffices as his direct competition, he says the way they have changed the traditional notion of offices allows companies like Cove to thrive.
"It helps people to see outside the box," Adam says. "Its going to have an impact on real estate, large organizations are going to continue to reduce their real estate footprint, cut costs and send people home. People working at home still deserve and need social interaction, and that’s where our value proposition is."
Cove is not only expanding across the map, it is also broadening its business model. Cove for Enterprise, launching this fall, will partner with businesses that want to cut back office space by having some employees work remotely.
It recently completed a pilot program with 50 employees from Deloitte that Adam said was a success. The first company expected to fully implement the program in the fall will be an NGO that Cove declined to name until their deal is finalized.
The nonprofit is utilizing Cove locations to help downsize its office from 10k SF to 5k SF, allowing it to spend more money on its mission of ending global conflict. Adam says Cove has several other companies lined up to begin the program later this year.
