A city where inventors, innovators and artists are nurtured may sound idealistic, but that’s the practical goal of an economic development strategy to promote an entrepreneur-driven economy in Albuquerque.
“An integral part of the entrepreneur ecosystem are coworking and meetup groups,” said Deirdre Firth of the city’s economic development department. “It’s happening across the country and has taken hold here.”
Coworking is a shared work environment, typically an office with an open layout, that’s at the grass-roots level of entrepreneurship. A coworking office or space will have Wi-Fi, printers, scanners, fax machines and meeting rooms. The people work there as individuals or in groups, forming a community in the process.
“Without coworking spaces, this model of entrepreneurship that will help us to change the economy won’t happen,” Mayor Richard Berry told the Journal. “You bring together two people who might not otherwise meet – a scientist and an artist – and innovation can happen. It’s in the culture of coworking spaces.”
Collaboration between people with different business backgrounds swapping insights and expertise is not new, but coworking makes it integral to the work environment.
“It used to happen around the water cooler,” said Stuart Rose, founder of FatPipe ABQ, a multifaceted coworking space. “FatPipe is really something of a 9,000-square-foot water cooler.”
Coworking spaces are at the ground floor of the entrepreneur ecosystem, just a step removed from the “solo-preneur” researching and developing a product or business concept out of a garage. The image of a talented loner creating a breakthrough in isolation, however, is more myth than reality.
“The world has changed. Increasingly, one person can’t do it anymore. It requires a team,” Rose said. “It’s not just research, it’s business.”
Spurring tech transfer
The bedrock of the Albuquerque entrepreneur ecosystem has traditionally been institutional research and development associated with the University of New Mexico, Sandia National Laboratories and the Air Force Research Laboratory at Kirtland Air Force Base.
The commercialization of institutional R&D, known as tech transfer, has also gravitated here from New Mexico Institute of Mining and Technology in Socorro, New Mexico State University in Las Cruces and Los Alamos National Laboratory.
Tech transfer, which involves patents, licensing and royalties, has been pretty structured for the past 20-25 years. UNM has its Science and Technology Corp., for example, while Sandia Labs has its Technology Ventures Corp.
Outside the institutions, the oldest part of the entrepreneur ecosystem are business incubators, which have had a presence in Albuquerque since the mid-1980s. Incubators, which are either publicly and privately subsidized, are buildings where startups can find both space and access to coaching, marketing and capital.
The newest part of the entrepreneur ecosystem appears to be business accelerators, which are generally a short-term version of the long-term support offered at incubators. Accelerators vary, but are usually focused on helping entrepreneurs or startups develop a game plan to succeed.
Struggling niche
Coworking is also fairly new to Albuquerque, dating back three years or so in its current incarnation as an open work environment shared by individuals and groups not affiliated with one another. The ABQ Coworking Alliance website lists seven coworking spaces or communities in Albuquerque.
While privately operated incubators and accelerators are investment driven, coworking spaces often exist off user fees that range from less than $200 a month to about $400 for 24/7 access. At least a couple in Albuquerque are in surplus space of a tech-related business and thus are effectively subsidized.
Located in the former library at Old Albuquerque High, FatPipe is a little different in that it has a substantial incubator component, hosting entrepreneurs and startups that have attracted low-level funding from angel investors.
While coworking is a popular alternative to conventional offices in so-called 12-hour cities, such as Denver and Portland, Ore., it’s a struggling niche in Albuquerque.
One of the city’s first coworking spaces, Convivium near the Paseo del Norte and Interstate 25 interchange, closed in late 2014 after a couple of years of operation. Plaza 500 at the 22-story Albuquerque Plaza dropped its option of coworking space for lack of demand and is now just executive offices.
“I have a theory that coworking is really successful in large cities where properties are expensive to rent,” said Jamii Corley of Southwest Cyberport, which sponsors the Ideas & Coffee Coworking Space. “In those cities, it’s tough to find something you can afford, so you collaborate to find a place.”
The low end of Albuquerque’s office real estate market is carrying a 23 percent vacancy rate, so there’s lots of cheap space available if a business isn’t picky. Bill Gates and Paul Allen, founders of Microsoft, leased an office in a gritty area near the state fairgrounds during their startup days before moving to Seattle in 1979.
“Meetups” are an essential part of coworking spaces, serving as forums for information exchange and networking. The formats vary, but most of the time they have a technology or business focus. Meetups usually have open attendance and thus serve as an introduction to a coworking space for many people.
Coworking has a future as the way work gets done changes, Corley said. Freelancing, consulting and contract work will lead to individuals and small coalitions of people contributing more to the economy, she said. Technology and the need to be agile and adapt to changes will lead many to opt out of the fixed overhead of a conventional office.
