More Places, More Ways: Convene CEO Ryan Simonetti On What's Driving The Company's Growth
A few days after New York-based Convene announced it had raised a $152M Series D round, co-founder and CEO Ryan Simonetti took a break inside the company’s newest location at the Wells Fargo Center in downtown Los Angeles.
The 36-year-old had just finished a series of on-camera and media interviews and there were more to come. Another television crew was setting up and waiting in another room.
“We had a former television producer come in here the other day to teach me how to look good on camera and coached me on how to be presentable,” Simonetti said.
“I hope I didn’t look bad,” he said, chuckling, referring to his television appearance on Bloomberg.
Convene, which partners with landlords and provides meeting, event, coworking and flexible workspace, has grown tremendously since Simonetti and co-founder Chris Kelly started the company in 2009 in New York. Simonetti is eager to talk about what is driving that growth.
Other partners and investors include RXR Realty, former AOL CEO Steve Case’s Revolution Growth, CVC2, The Durst Organization and Elysium Management.
The company has 23 locations totaling 700K SF across major cities, including New York, Washington, D.C., Philadelphia, Chicago and Boston.
Convene opened its two newest locations in Los Angeles in March at Brookfield’s Wells Fargo Center at 333 South Grand Ave. and Brookfield’s 777 Tower at 777 South Figueroa St.
And it is not done.
The company recently acquired a Boston-based firm that tracks workplace activity and it has plans to expand globally, perhaps with London as its next stop, and add around 1M SF in a total of 10 locations by the end of next year.
"We're stretching out, first at bat, first inning," Simonetti said. "I think real estate as an industry is being disrupted for the first time ever and technology will continue to change this industry and accelerate. We have a front-row seat to that and a seat at the table. And we're going to take advantage of that."
Bisnow sat down with Simonetti and asked him about Convene’s newest Los Angeles location, the recent series round and his advice for entrepreneurs.
Bisnow: Why Los Angeles? Why open here now?
Simonetti: When we look into expanding into cities, we look at two things: Are our customers asking us to be there? And are our partners asking us to be there?
In LA, we had both of those. LA was on the list of where we were going to expand into for all the reasons that we know — it’s a major U.S. city, from an economic perspective the city has performed really well the past five to six years, there is a diversification of the industry base.
We are big believers in LA as a market. There are a lot of the big technology companies coming here. There is so much momentum here in LA that is exciting for us.
Lastly, Brookfield, who is one of our investors and partners, wanted us to reimagine not just a building but what the workforce experience is like — not just here but for their entire portfolio.
Bisnow: Explain how you are reimagining the workforce experience.
Simonetti: We are partnering with Brookfield to design and operate an amenity and hospitality experience specifically for the tenants of the buildings in their portfolio.
There will be places to meet, have an event, places to work for the day — type of a club-like kind of feel, there’s a space for wellness programming. One space will have a gym in it.
These are the things that could help [provide] a different type of experience for the individual employees of the companies in the building around wellness, community, food and beverage and places to meet.
In addition to all of that, our community managers are working closely with Brookfield. We are running programming for not just Convene spaces but the entire building and eventually the portfolio.
It’s very different from what a lot of coworking companies do. They just focus on their members. We view every employee in this building as a potential customer or an extension of our platform.
We are so much more than just a space company. We are really an experience company and [are] doing that strategically with our landlord partner and helping them create a true sense of place in an office building.
Bisnow: Give us your thoughts on the latest round of funding. What is driving the growth of Convene and generally, the coworking and flexible workspace industry?
Simonetti: Convene’s growth is because of our execution.
You are not able to build your business if you are not delivering on your promise to your customers and partners and investors. I think the round is just validation for the fact that our team continues to execute and has done that for a long time.
I think what’s driving Convene and the growth opportunity for us and other companies emerging from this kind of workspace as a service category ... it is a fundamental shift in the way companies want to consume real estate.
Today whether you are a small business or a Fortune 500 company, the workplace experience is now an extension of your culture strategy. It’s a part of your talent strategy. And at the same time you need flexibility and agility in your real estate strategies because the world is less predictable today than it has been in the past.
The fact that companies sign 10- to 15-year leases — it really doesn’t make a lot of sense. I understand for the landlord and the financial markets but if you put yourself in the shoes of a company, [it doesn’t make sense].
I’ll give you an example. In the last 36 months, we went from 100 or so employees to 450 employees. Our corporate office in the last 12 months has tripled in size. If we had signed a five-year lease, what would we be doing? We’d have people working in four or five different offices.
What companies like Convene are offering is this turnkey experience where everything that you have to worry about from securing a space, getting an architect, building it out, to running your pantry service, how to feed your employees, etc. — all of that stuff we do for you. We are the only full-service, hospitality-driven platform.
Bisnow: Where does Convene go from here?
Simonetti: More places. More ways. That's our strategy. More locations and serving our clients in different ways. We went from being a meetings company to then being an amenity and hospitality platform. Now, we provide workplace solutions.
I think as work and life continues to become more integrated and as our experiential personal life blends closer to our work life, there is an opportunity for us to think differently about some of the things we can do with the physical environment.
We're working with a few cool partnerships that would bring some type of retail elements into our footprint. And I think [we're] continuously finding new and innovative ways through technology and services to really serve our clients and deliver them workplace experiences in a seamless way.
Five to 10 years from now, I really believe we'll own the ecosystem that is workplace, and I think coworking is a big piece of that.
Bisnow: You started this business in 2009, and your company has been very successful. What drives you? What keeps you motivated?
Simonetti: I think the people that are sitting right there. (He points to employees nearby).
Creating a culture and creating a platform that creates an opportunity for people to grow personally and professionally. I take a tremendous amount of pride in that personally.
One of my favorite quotes is, “The easiest way to change how the world works is to change how businesses work.”
If you think about Convene, we have an opportunity to do that within our own business, but we’re also uniquely positioned to help be a catalyst and impact how other companies operate their businesses via real estate.
Bisnow: What kind of advice would you give to those wanting to create their own business? What are some of the lessons you’ve learned from running this company?
Simonetti: First, have a definition of what success means to you. It’s really tough to achieve what you want to achieve without a definition of destination and how you define success. To me, that’s as much personal as it is professional.
The second thing is once you have that [definition] be committed to putting in the work to get there.
The one thing I can tell you having done this for nine years is that there are no shortcuts. Success is a very bad teacher. We have kind of failed our way to the position that we are in as an organization. We’ve learned from those mistakes and have been able to pivot and evolve and be the company that we are today.
Lastly, for those people wanting to be entrepreneurial, take that shot. Take that chance. I don’t think there is a better time in the history of the world to start a company. I don’t think it’s been any easier, frankly, because of technology.
So for people wanting to do that, the hardest thing is jumping off. Once you do that, as long as you don’t stop, and stay committed, I think great things will happen.