COWORKING in a Small Town: Lessons Learned

On May 1, 2009 I opened the first COWORKING location in San Joaquin County and Tracy, CA. A revolutionary concept in office space I was sure everyone would instantly embrace. 

In 2009, our country was in the middle of the worst recession in history and many people were unemployed.  I was retired (from Lawrence Berkeley National Lab) but hoping to become a teacher.  Seeing the job market for teachers be completely wiped out, but having some extra money in the bank and retirement money coming in, I decided to start my own business…..preferably one based on my passions of encouraging and evangelizing: telecommuting, videoconferencing, & remote work.

Surfing the Internet, I happened upon a relatively new concept for office space: Coworking. The parallels to the 1990’s neighborhood telework center concept I worked on, were apparent, but with a modern technological twist (Internet, wifi, cell phones, laptop computers, etc), and with a social component not covered in the old concepts.

Although I did not fully understand coworking, I did understand the basics: Coworking is open, collaborative, encouraging, supportive, affordable, a community, and provides opportunities for continued education as well as free coffee, free wifi, with ample opportunities to socialize with other members.  In short, a great place for start-ups.  

It sounded great (to me), so I opened with great expectations. 

Before I talk about the lessons learned in my 67 months as owner of AltamontCowork, a bit of background on our small town of about 86,000:

Tracy, CA is located about 45 miles due east (as the bird flies) of San Francisco. Tracy was transformed from a sleepy farm town into a commuter bedroom community in the mid-1990’s thru early 2000’s as cheaper housing attracted people in droves from the Bay Area. Much of the working population commutes to the Bay Area. They leave at 5 or 6 AM and return home 7 or 8 PM.  Traditionally blue collar, older, family-oriented, no college in town, with three high schools. Tracy is equidistant to many of California’s greatest sights: Yosemite and the Sierra, the Pacific Ocean (Carmel, Monterey, etc), and THE City.  The government of Tracy has, for the 30 years I have been here, been content to keep things the way they were in 1985.

With AltamontCowork, I figured that:

1. Commuters would flock to the office to get off the roads, be more productive, save money, reduce stress, be closer to home, etc.

2. The City of Tracy would love the idea of people staying in town during the week (added money to local restaurants, etc.) and have a place were high-tech start-ups could affordably get their start.

3. Small business owners, or start-ups, struggling in the midst of the recession, would be falling over each other to rent an affordable office space where they could collaborate with other small business owners in an open, collaborative environment like the residents of the big cities (SF, NY, Chicago, Santa Cruz!, etc) were doing. Coworking was booming in those cities. It should boom here. Right?

I was wrong on all three counts.

After 5 years and 7 months in business, this is what I learned about coworking in small town Tracy, CA (and possibly any small town close to a large vibrant metropolitan area):

Commute Time Research1. Commuters are going to commute and they are not going to ask their bosses if they can work at a local coworking location. At the very best, commuters might ask their OFB’s (old
fashioned bosses) if they can telecommute out of their home, but, since they only do that 1 or 2 days a week, there is no time for them to get lonely, or distracted, and / or desire the collaboration & community of a coworking space.

Lesson Learned: In the 5 years and 7 months in business…only 2 telecommuters graced our halls. One of them left after a month while the other stayed for three years working on his own businesses on the side. He eventually bought AltamontCowork, taking over control at midnight on Dec 31, 2014.  

tracy city hall2. The City of Tracy City Manager, at the time it was Leon Churchill, hired consultants to research the feasibility of the City starting a “Business Accelerator” to attract creative high-tech start-ups to Tracy. The consultants found AltamontCowork and knew right away that we were a perfect fit.  I, however, being a 30 year resident of Tracy, had my suspicions that nothing would happen, but, we (I and all our members) went through the process anyway.

Guess what?  Nothing happened.

Lesson Learned:  The City of Tracy is not interested in starting a business accelerator for high-tech start-ups…….yet ….(I am still holding out hope that they will see the light in the next 5 or 10 years). Oh….Leon is no longer the City Manager.  

yellow office 13.  The small business owners, or wanna-be small business owners, of Tracy, CA want a cheap 10 x 10 office with a door, or are content to work at Starbucks, McDonalds, etc. for free. Only a very few embraced the open office collaborative concept, and utilized it to it’s fullest. The creative excitement and energy you get in San Francisco (or any bustling, vibrant, city) is simply not here.  Here, people are surviving, not creating.  Most who joined just saw it as a cheap office; a place to meet clients on the weekend or at night, send mail to, and visit occasionally to work. The open collaboration and community of a true coworking location are not something they care about.

Looking back to 2009 – 2010:  I believe I was actually “fooled” into thinking the open collaborative space would be a wonderful thing here.  

When I first opened many people were unemployed and collecting unemployment. My first coworkers were in that category. They came to the office everyday, they collaborated, they laughed, they went to lunch together, they helped each other, we had Tweet-Ups, Donut-Ups, Pizza on the Patio, and they worked on starting their own businesses. True coworking, exciting, fun, productive.  I just knew I hit on the perfect idea for Tracy, CA!  

It was only 5 years and 5 months later that I realized that I was fooled.  My original coworkers, as much as I love them all, were simply using the place to hang out while unemployment paid the rent. As soon as the economy started turning around, and the unemployment benefits ran out, I lost them all. Survival.

 Interesting….

Lesson Learned:  Fundamentally, Tracy, CA small business owners, or wanna-be small business owners, simply want a cheap office with a door.  

Conclusion

After 67 months in business, I finally had to give up on my dream of a collaborative coworking experience here in Tracy, CA.  I can also, now, look back more objectively and predict that coworking (in it’s purest form) may happen in Tracy, CA, but, it won’t be until the kids of today (18 to 25 years old) get to the point where they can start their own business (5 to 15 years from now).  BUT, these youngsters (those with ENERGY, EXCITEMENT and LACK OF FEAR to try something new) will have to stay in TracyAnd as my  similarly aged daughter says:  “Good luck with that!”

Lesson To Be Learned: Ex-City Manager Leon Churchill had the right idea: Tracy, CA needs to attract high-tech / professional businesses and advertise themselves as THE location for start-ups and as THE creative work alternative for Bay Area / Silicon Valley companies (while offering affordable housing, good schools, etc.)…..unfortunately, the City of Tracy is only going after warehouses (remember: Tracy is, after all, centrally located). 

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6 comments

  1. Many potential users of this co-working space work in Silicon Valley where knowledge work is centralized in commute-in offices and mega campuses. This is probably the biggest impediment to the success of the Tracy co-working site.

    The situation presents an interesting paradox. Silicon Valley and the Bay area innovated much of the information and communications technology that eliminates the time and distance burden of daily commuting. But the companies that invented it don’t use it to achieve this benefit and remain trapped in a pre-Internet Industrial Age mindset.

    Fred Pilot
    http://www.lastrushhour.com/

      1. I don’t think it’s so much OFBs but rather a cultural issue. It’s a big conceptual shift to perform knowledge work outside of centralized commuter offices (CCOs) as I term them in my book Last Rush Hour: The Decentralization of Knowledge Work in the Twenty First Century. Many people simply don’t believe that’s possible because they are working from an Industrial Age framework where people live in one community and work in another, often distant from their homes in large metro areas like the Bay Area. I believe this centralized structure is extremely wasteful and is fast becoming unsustainable.

        Fred Pilot
        http://www.lastrushhour.com/

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