One of the many things I find fascinating startups is their fascination with office space.
When a startup moves into a new office, it is like a rite of passage because it apparently says to the world that they’ve made it or, at least, moving up in the world. They are particularly stoked if the office is in a cool area, it’s a cool space or it’s big.
The reality, however, is many startups stumble badly when it comes to office space. They tend to spend too much, get too much space or move into an area that’s red-hot. Finding a new office can also consume too much management time and resources, and it can become a major distraction.
At the end of the day, moving to a new office can be a disaster that ends up being not generating the expected benefits and returns. In far too many cases, startups end up regretting the move because the time and cost involved doesn’t create a good enough return.
And to be frank, too many startups shouldn’t move at all. They tend to move ostensibly because they need more space but often it comes down to the need to change or show the world how well they are doing. Moving to a new office is a tangible way of saying that a startup is on a roll.
In the scheme of things, office space is far less important than a startup thinks. The quality of an office can have more to do with the people working in it and the corporate culture than the space itself. Simply because an office isn’t in the cool part of town doesn’t mean the office isn’t cool. And I don’t think good talent won’t work for a startup if the office space isn’t wonderful.
Another key issue is cost. The cooler the space or location, the higher the price. If a startup needs to pay significantly more for new space, the reality it takes away from other things (marketing, sales, talent) that also consume money.
For startups thinking about moving to a new office, I would suggest thinking long and hard about it. Move for the right reasons so it helps the company grow and take things to the next level, rather than simply wanting new, cool space.