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Should You Shack Up With Your Start-up Team?

You already spend all waking hours with your staff. Moving in together--if you can handle it--could save you serious cash.
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Sometimes thinking outside the box means thinking outside the traditional office.

When SceneTap first launched in 2010, one co-founder lived in Chicago, the other in Dallas. Part of the business team was in Chicago, but the IT folks were spread over the map. "We were constantly updating each other through the day," recalls co-founder Cole Harper. "We soon learned this was a difficult way to get things done."

SceneTap uses facial recognition software to gauge the numbers of people, their ages, and male-to-female ratio in retail stores and bars for analytics purposes. It also offers an iPhone and Android app that lets pub crawlers see this information to help them select a bar on any given night. Like many young companies, the founders wanted to hold down costs, and they knew they wanted the core team in the same city. For affordability, lifestyle, and available IT talent, they chose Austin.

Who needs office space?

But when they began shopping for office space, they made an interesting discovery. "We found that any office space of over 2,000 square feet was at least $6,500 a month," Harper says. "Or we could rent a 5,600-square-foot mansion for $5,200."

Consider the savings on home rental costs, and choosing the house was a no-brainer. SceneTap moved in, with five of its 11 local employees living there, and the rest (many of them married) commuting from separate homes. "It's home and work for five, and work for 11," Harper says.

A perk employees love

The situation comes with some challenges: Disagreements over ants in the kitchen, a cat and dog that have to be kept carefully separate, and the like. But there are huge advantages, Harper reports. With major partnerships in the works, projected revenues for SceneTap in 2013 and beyond are $10 to $20 million and more. For 2012, however, projected revenues are just over $1 million, and with 18 full-time employees, this means SceneTap can't afford lavish salaries and perks. Several core staff members left six-figure positions to join SceneTap at salaries of $40,000 or less. Providing them free housing—in a mansion—seriously softens the blow.

"We've made sure the house, being an office, is still conducive to getting things done," Cole says. At the same time, "We wanted to build a culture where people enjoy coming to work and staying at work, so there are no cubicles. We have a game room with darts, ping pong, Foosball, and air hockey. There's a hot tub and a zip line in the backyard. It's like a huge adult playground for when people want to take a break."

It's good for productivity, too

With core team members all under one roof, work and play times tend to blur, he adds. Assuming you have the right people, that can lead to a lot of productivity. "It flip-flops between work and play throughout the day," he says. Once, he recalls, he left the office in the morning on an errand and returned at 1 pm to find everyone in the hot tub with beers. "Then by 9 p.m., they were done with that, and everyone was back at their desks."

That's typical, he adds. "Since there's no going home, we all tend to feel that whenever there's nothing else going on–we might as well work."

IMAGE: Flickr
Last updated: Apr 26, 2012

MINDA ZETLIN | Columnist | Co-author, 'The Geek Gap'

Minda Zetlin is a business technology writer and speaker, co-author of The Geek Gap, and former president of the American Society of Journalists and Authors. Like this post? Sign up here for a once-a-week email and you'll never miss her columns.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.



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