Shared Spaces and Coworking – A Jolt Into Main Stream?
VC Company Leases Penthouse Space for Coworking
In Sacramento, CA, Velocity Venture Capital will be developing the top four floors of a major office building for use as a coworking space and a startup accelerator. The firm, based in the nearby town of Folsom, is planning to take this space in a different direction than its competitors. Amidst the constant development that Sacramento has seen in recent years, this is the first coworking space that will occupy a flashy penthouse space.
Velocity states that it is not targeting early-stage startups. Rather, their audience is larger startups who have some investors and revenue behind them. These companies aren’t yet at the scale at which they could justify leasing their own penthouse, but working in a luxurious space would do well for their relationship with future investors (and future hires).
Velocity is in a good position to make this move because it has run a startup accelerator program for the past six years. The company is well-connected in the local startup scene, making them ideal for attracting candidates that would be a good fit for their unique space.
In an interview, when asked about the benefits of high-end coworking spaces, Velocity general partner Jack Crawford responded that “when you are meeting with customers, when you are recruiting management talent and meeting investors, you want to be in a place where it looks like significant investment has been made.”
Image matters, whether you’re a startup or a multinational corporation. As the stakes get higher, companies have more and more reason to maintain an image of authority to the people that they meet, and a penthouse office is a simple (if pricey) way to do that. Sharing the space takes some of the priciness out of the equation.
The largest of the four floors leased by Velocity will be dedicated as a coworking space, but the remainder will serve other uses. The 26th floor, one above the coworking space, is planned to offer satellite offices for accounting and legal firms who want to connect with startups and offer their services. The 27th floor will house a photo studio, while the top floor will be a second office for Velocity.
Entrepreneurs will benefit from having close access to professional services and media production equipment. This coworking space offers not just proximity to fellow startups, but also connections to the services that startups need to succeed.