Original article posted in August 2020 issue of Franchising USA.
Flexible, on-demand office space has exploded in popularity recently, but one Boulder, CO franchise got a head start on the industry nearly two decades ago.
Office Evolution, founded in 2003 by CEO Mark Hemmeter, is enjoying the surge in popularity of flexible, on-demand office space. Now the largest coworking franchisor is moving fast so its franchisees can take advantage of the trend, too. At the core of the brand is “Ohana”, meaning extended family in Hawaiian. Office Evolution commits to supporting every franchise owner with the resources and support they need to thrive and have a rewarding career as a business owner.
One of the many benefits of becoming an Office Evolution franchisee is that you only have one, professional employee to manage.
"It’s ideal for entrepreneurs who are looking for a part-time business to run that won’t take over their lives,” Hemmeter said during a recent interview.
To enable this one employee model, the corporate office helps out with a lot of the administrative work.
“We do all of the onboarding, billing and all of the collections for all the members,” Hemmeter said. “We have a call center to answer phone calls. We do an enormous amount of marketing and lead generation for them, probably generating more than half of their leads. We provide all their tech support. It’s a broad list of services we provide for the franchisees, enabling them to only have one employee.”
Most of Office Evolution’s franchisees are entrepreneurs themselves, the CEO explained. As experienced business people, they realized the unique opportunity an Office Evolution provided. They are basically active investors, meaning they’ve invested in the business and they are active in the management of the business, but they don’t need to be there for the day-to-day running of the business, like they would in some other types of franchises. Hemmeter explained that more than 93% of the income is recurring due to Office Evolution’s subscription-based revenue model.
Deemed an essential service, all Office Evolution locations remained open during the stay-at-home orders and were able to support clients. with the health and safety of its members and staff in mind, all centers have taken numerous coronavirus precautions and are following CDC guidelines, including social distancing throughout the office, a face-mask policy along with temperature checks.
This is a business to business offering, so hours of operation of the coworking locations are standard business hours, Monday through Friday, allowing franchisees to keep lifestyle hours - balancing work and leisure time.
“They want a franchise that fits into their life,” Hemmeter noted.
Currently, Office Evolution has sold 140 locations. The brand has 72 open locations the balance in various stages of development.
That development involves the company helping franchisees to find office space to lease (although some franchisees opt to buy their buildings) and then configuring that space into an optimal combination of private offices, conference rooms, shared facilities and coworking spaces.
To be an Office Evolution franchisee, you really just need to know how to manage a business and empower your one employee, Hemmeter noted.
To help franchisees start their business off on the right foot, Office Evolution assigns a Franchise Business Consultant to each Franchisee. New franchisees are also invited, with their employee, to Denver for five days of comprehensive training. After that, there is ongoing training available online. Office Evolution also has its own intranet for franchisees where they can collaborate and share best practices.
As the franchise also shares numbers on how each location is doing, franchisees can get competitive and motivate each other as they meet virtually, foster relationships and generate new ideas.
So far, Office Evolution is active in 26 states across the United States and Hemmeter is looking to expand into the Canadian market soon.
Right now, there is a lot of rapid growth going on in the southeast, Texas and the west coast.
“There’s good availability from Seattle right down to San Diego,” Hemmeter said.
This growth is spurred on by the recent boom in interest for flexible workspaces in suburban markets and has been accelerated by the COVID-19 pandemic.
With people more hesitant to be in large groups in confined spaces, the idea of a flexible work environment, close to home, with a shorter commute, is more attractive than ever.
“The days of the traditional corporate office are dying,” Hemmeter stated. “People increasingly want to have options for how and where they work.”
While there are other shared workspace businesses out there, Office Evolution has some distinct advantages over their competition.
First, they’re a franchise, which is unique in this industry.
They also primarily target small business owners rather than employees of larger companies as members.
And Office Evolution also makes a conscious effort to have their spaces close to where people live. That means they’re in the suburbs and smaller towns. They’re not in city centers, where people are more reluctant to go now with the COVID-19 pandemic.
Office Evolution was already ahead of the trend for flexible, on-demand office space with smaller, locally owned and operated locations in suburban markets, the CEO noted, but now with the pandemic putting a spotlight on just how unnecessary fixed corporate office space is, the demand is exploding. People want a cost-effective place to work where they can find inspiration and be surrounded by other professionals, while at the same time knowing the environment is safe. In addition to their LMS modules, Office Evolution runs monthly owner and manager calls and an annual convention. This has Hemmeter excited about the future prospects for growth.
Originally from Honolulu, HI, Hemmeter comes from a real estate development family that built large hotel resorts in Hawaii. He moved to Colorado and became a client of an on-demand office space company in 2000-01 and loved the concept so much that he left the family business to start Office Evolution in 2003.
For anyone who wants a simple, single-employee business to run part-time with 93% recurring income, Office Evolution is a good fit, Hemmeter said. Veterans receive a $5,000 discount on their first location and veterans are some of the company’s best franchisees, he added.
What started as a novelty has become a trend spurred on by the realization that office space is long overdue for a transformation to match the ever-evolving workplace. As a B2B business, franchisees are able to help solopreneurs and small businesses thrive by providing them with the space, community and support they need. For anyone looking for a business with exponential growth potential and a product that will not expire, Office Evolution is a golden opportunity.