Every company needs to start somewhere. For Vestwell, like many others, that start was at WeWork.
Coworking spaces are a great starter home for many companies, providing a creative and innovative environment to work and without the pressure of a long-term commitment. But what happens when a startup outgrows its first home? For Vestwell, a digital retirement platform working with financial advisors and employers, that’s where we came in.
Getting Out of Coworking
It didn’t take long for Vestwell to feel the restrictions of their coworking space. The constant lack of conference rooms, rapid growth of their team, and the inability to host clients in their shared space prompted a need for their own space.
When it was time to move on, Vestwell hired SquareFoot to find the first office they could call their own.
Originally starting their search in Harlem and outer boroughs, they realized they needed to be close to transportation that was convenient for all employees traveling from outside of the city. They wanted a private space that they could make their own, but something that was practical and convenient.
Working with SquareFoot Broker Matt Held, they came to the conclusion that in order to get everything they wanted out of their new office, they had to sign a 5-year lease. Unsure about company growth, it was a bit risky but worth the compromise for price, location, and the actual office itself.
In this new Midtown office near Port Authority, they were able to establish their own culture and continue growing their company. And grow they did, much faster than they anticipated.
Bursting at the Seams
Whether for financial modeling or determining office space needs, one of the major challenges young companies face is predicting their own growth. So many factors can play into headcount growth over the life cycle of a business, from new funding to dramatic pivots and competitive headwinds.
“It was a nice office, but we outgrew it,” says Dave Sheen, SVP of Finance. By the end of the year they were looking for something bigger.
Vestwell’s growth plans accounted for a 4x increase in headcount over the duration of their lease. That ended up happening within a year, having closed an $8M Series A.
While Vestwell wasn’t going to trade their growth for the sake of not leaving their office, they needed to resolve the ominous four years and hundreds of thousands of dollars in rent left on their lease. So, they again contacted SquareFoot to solve their two problems:
- Find a business to sublease their current space
- Find a new space for their now 30-person team
Again, Vestwell worked with Held, who was able to concurrently line up a sublease and find a new office in Midtown.
“Our team is commuting from across Manhattan, Brooklyn, New Jersey, Connecticut, and Long Island. So we really needed somewhere that’s close to subways, Penn Station, and to Grand Central,” says Sheen.
Sheen admits Midtown can sometimes have a bad reputation for its congestion, but the location provides the escape of Bryant Park and the proximity to great lunch options like Poké Junké and Los Tacos No. 1, while still being near most public transit.
Within five weeks, Vestwell found their new office, only two blocks from Bryant Park, and found a subleasor to move into their space as-is.
Fostering Culture Through Design
When it came to designing their new HQ, there were a few things they did differently the second time around. “We built out the last space and quickly figured out things that were wrong with it,” says Sheen.
At the top of that list, the bathrooms. The employee-to-bathroom ratio created significant traffic jams and was a constant source of complaints. “When we moved to this place, as well as making sure we had more bathrooms, we also made them more usable by everyone,” says Sheen.
The conference rooms were also an area of improvement in the new office. “We’re a startup so we want to be more laid back and more casual, but we still need to present an image of being an established company,” says Sheen. A boardroom-style conference room was needed when presenting to their financial services clients, but it didn’t fit the style of their day-to-day operations. In the new design, they included additional rooms that functioned as casual meeting areas with couches instead of conference tables, for times when a more formal setting isn’t required.
The third change they made was upgrading the phone booth call rooms from “dark and dingy” spaces with large heavy doors to light and airy spaces with welcoming glass doors. And to combat the noise levels and lack of privacy, arguably the most common critiques against open offices, Vestwell installed speakers to send out white noise and block conversations from traveling across the office.
A Place to Call Home
When it comes to how the employees interact with their new space, Sheen explains that for the most part it’s head down during the day, but come 6 o’clock it’s not unusual to witness a game of Ping Pong or enjoy a beer from the tap.
The office is also often greeted by furry guests of the four-legged variety, and employees often work from home on Fridays, giving them a day to free themselves from office meetings, as well as schedule personal matters such as the electrician or a doctor’s appointment.
“We work pretty hard but everyone gets on pretty well,” says Sheen of the company’s 38 current employees – 30 more from the team that started out at WeWork.
Designing a new office isn’t without its challenges. “The biggest learning for me was during the actual lease negotiation process. Be as clear as you can on the final design and who’s responsible for what,” says Sheen. “And set the deadlines up front.”
He’s also learned that it’s tricky finding an office space when you’re a growing startup. “You don’t want to get a space that’s way far ahead of where you might be because there’s a risk you might never get there”, says Sheen. The current office gives Vestwell some flexibility to continue growing to 50 or 60 people without feeling cramped, allowing them a few years of staying put before the search begins again.