Name: Frank Cottle
Talent: CEO and Chairman
Headquarters: California, USA
Superpower: Absolute access
Frank Cottle is the CEO of Alliance Virtual Offices and Chairman of the Alliance Business Centers Network. He is a recognized expert on flexible working, the virtual office movement, and ‘third place’ working.
Listen to the podcast with Frank Cottle
Watch the full interview with Frank Cottle
Lisette: Great. And we’re live. So welcome everybody to this remote interview. My name is Lisette, and I’m interviewing people and companies doing great things remotely. And I’m super excited today. Today on the line, I have Frank Cottle all the way from the shores of Newport Beach, California. It’s making me homesick just to say the name for a beach. And Frank, you’re the CEO of Alliance Virtual Offices. It’s an office address. It’s a local or a toll-free number, or it’s a receptionist answering calls in your company’s name. We’re going to dive into this, but let’s start with what does your virtual office look like. What do you need to get your work done?
Frank: Boy, a lot of bandwidth, I can tell you that. I really have about half a dozen virtual offices. I move around quite a bit all over the world. So my virtual office really is anywhere I’ve got a lot of bandwidth, some quiet. I’m not a person that works well in a crowd. So the digital nomad life of Starbucks to Starbucks isn’t my style. And really, that’s about all, a laptop, of course. I prefer a traditional laptop to a tablet because I keep a lot of data, things of that nature. And we’re fairly practiced with this. Our entire executive team in our company works virtually. We’re a global company. We’ve been in business in the service [inaudible – 01:29] office industry since 1979, so 37 years now.
Lisette: [crosstalk – 01:36] a lot [inaudible].
Frank: Well it has. It’s amazing. We started building buildings, the funny, little things called executive suites. And it moved on from there to business centers. And now we have a global office network in 700 locations in 47 countries. And run a variety of virtual office management companies. They look a lot like what Expedia would look in the travel industry where people come to us from all over the world and [inaudible – 02:11] virtual offices, seeking a virtual office somewhere and then replace them into a facility of an address, meeting in conference rooms, day offices, should they like, telephony, bandwidth, live reception, clerical, secretarial, administrative support if they should need it anywhere in the world. So we have a little thing called the Rule of Ten. And for us, that means we can [inaudible – 02:39] any company or any individual, ten offices in ten cities in ten countries in ten minutes. So it’s a very simple way, as easy as booking a hotel room anywhere around the world.
The same with meeting in conference rooms. A lot of people that are working virtually have their office set up, but they need places to meet with others. So we do the same thing for meeting in conference rooms globally.
Lisette: Who are the people using these services most of all? What do they look like? Must be a lot.
Frank: They’re usually tall.
Lisette: [laughs] Blonde.
Frank: I think the easiest thing to do is to look at the customer breakdown of our entire industry because virtual officing, as you know, takes so many forms that we really look at everyone that uses flexible workspace in a variety of fashions because what we’ll find is that a global corporate 1000 or Fortune 100 company, they may have a conference room contract with this. They may have a virtual office contract with this. They may have a temporary office contract with it. They may have multiple workstation team office contract with this. So most companies, larger companies use the entire spectrum of offerings that come from the flexible workplace industry. And if I could keep it very simplified and put 100 percent into 20 percent chunks, the customer base for the industry would be surprisingly government is about 15 to 20 percent of [the floor base – 04:30] in our industry. On top of that would be the global Fortune 1000, about another 20 percent. The core of our industry that was started is based around legal accounting and financial services professionals. Thereafter, the next 20 percent would be regional companies, local companies, marketing, media companies, small distribution companies, sales companies. The last 20 percent really are what everybody thinks of are startups and entrepreneurs. That’s the fastest growing sector, so we’re seeing shifts. And it’s really not necessarily just startups and entrepreneurs but all of the shifting and contractors as opposed to employees. So that government sector, that sector of corporate users. If you look at a ten-year-old annual report from a major, global 100 company, you would see a number in there that said ‘number of employees’. And it might be 300,000, massive. A company like Cisco, 300,000-400,000-500,000 employees. Today, when you look at their annual report, it’ll say we have a workforce of 400,000 employees. That workforce includes all their contractors. And a big percentage of employees have been put out to contract, which is really good for both sides, creates more flexibility all around. We hear an awful lot about immigration and borders and all of this political talk today. But really, you can do almost anything in the service industry these days such as you and I are doing right now, without any deference at all to borders. We’re working today. You’re in the Netherlands and I’m in Newport Beach. And yet we haven’t had to go through customs or immigration or do anything. We don’t have to worry about currency exchanges. We don’t have to worry about passports. This is the world. So globalization of the workforce is changing the structure of our industry and bringing more into this independent contractor status, which today we lump in the entrepreneurial, solopreneur structure. But that will end up being about 40 percent of our entire industry over the next 3 to 5 years.
Lisette: Wow! And in the services, you offer a large variety of services like an office address. Help me clarify. What I think of that is I’m traveling yet I need a fixed address. Or maybe I’m traveling and I need a fixed address in order for my company to be registered [inaudible – 07:25] to come. Is that what that is?
Frank: Yes. In the world today, we talked about immigration and borders. So we’re talking about rules. Have you ever tried to open a bank account without an address?
Frank: Have you ever tried to register a company without an address? You can’t. So if you’re going to be in business, not just in a gig economy, solopreneur type of thing where it’s not a business. You have to have a registered address. You’ve got to have one. And you have to have one for a bank account. You have to have one to give a credit card. It’s not personally guaranteed, so for corporate business credit. You also have to have a land-based telephone line attached to that address. If you don’t, you won’t [inaudible – 08:21] bank account [inaudible]. You can’t. So I work out of my house and I have a cell phone. And I want to have a registered company that way to get the bank account and get credit. Not going to happen. So first, it’s a legitimacy thing. Second, people that you’re doing business with like to know that you actually exist somewhere.
Lisette: That you have a headquarters, like a home base somewhere.
Frank: Exactly. Also from a privacy point of view, I don’t know about you but I would not want to give people my home address. I don’t want people stopping by, heaven forbid. I don’t want intrusion. I don’t want vendors. I don’t want it. So business is business and your personal life is your personal life. And you [lend them – 09:09]. But there are certain things that you do want to keep separate. And we ensure that through a variety of structures for 37 years now.
Lisette: Wow! You said you’ve been in business since 1979. And I know this is going to be a big question, so we can approach it from a number of different angles. But what have you seen change since 1979 in this sort of world of work? Obviously, we’re going to more contractors. But the mindset of business is also changing. I’m not sure exactly what my question is, but I just feel like since 1979, there must be something that you’ve noticed or you think. Maybe we’re on an exponential curve now.
Frank: I think there are three things that have changed materially. My hairline and my waistline are two of them. But I think the thing that you’re referencing, [it really is all just say the – 10:07] elevator speech. In 1979, people [inaudible – 10:13] 1980 or even 1990 and 2000 or even today, people say, “What do you do?” I said, “Oh, well, we’re kind of the real estate business, but we add a little of this, little of that. And it really works out well. It’s cheaper, faster, cheaper, better.” [But you go – 10:28], “Oh.” And they walk away. So today, we look at our industry and say we combine people, place, and technology into a single service that’s highly flexible and provided by a single, bundled service agreement. So people go, “That’s interesting,” and they want to know more. So really, we combine people, place, and technology. I think the clarity in that of how to take those three things together and provide it through a flexible service agreement rather than employment contracts and long-term leases that require a lot of capital expenditure, that bundling of those products is where we are today. Just like if you were to go to Amazon and say, “Well, Amazon, what do you do?” The simple answer is we’re in the warehouse business. They’ve combined warehousing with technology in retailing to create an entirely new service product that people really benefit from, and obviously, Amazon [has grown – 11:33] pretty well as a result of it.
Lisette: Yeah. I remember when they started, people weren’t so sure. It was really a year-to-year…
Frank: Oh, yeah, they were in the book business. And they have the biggest warehouse of books in the world, they said. That was their thing, giant, giant warehouses. And they did that. In fact, a friend of mine is [inaudible – 11:53] borders [inaudible] out of business. And borders just went away.
Lisette: It was amazing. Yeah, I remember that.
Frank: So that’s part of what we did. So I think the elevator speech, people’s recognition today, the flexible workplace is the workplace. Every major company has a flexible working in their HR department or their real estate departments. And 30 years ago, people had no concept. So we’re kind of like those pioneers that have been out there. And they say the pioneers just get [stabbed – 12:36] full of arrows. We have a lot of scars from our learning curves, but we have sustained that. And today we’re in a very fortunate position.
Lisette: Yeah. I mean it seems like the services you offer are right in line with what’s happening today with [inaudible – 12:53] with the digital nomad movement taking off and people [crosstalk – 12:56] these kind of services, I can only imagine that that’s going to become more and more popular.
Frank: It is. I think that it’s really a work lifestyle and people’s recognition in the generational changes that we’ve seen too of workers from baby boomers now to millennials. The values or the things that people feel are important in their lives have changed. There’s been a migration in values. So the workplace has to change with it. And it’s always been slow to do so. And the new concepts of serviced offices is the centers, incubators, accelerators, logistic centers, media centers. All these types of flexible work structures that have grown up through our industry, they all combine people, place, and technology with the flexible service agreement. That is the next generation of work.
Lisette: What do you think is the main resistance out there? Who’s resisting flexible working? I don’t know if you know the answer to this. But in your opinion, who’s resisting and why?
Frank: I don’t think anybody is, honestly. There are about 1.6 billion mobile workers today. People work outside of the workplace a minimum of two days a week. That’s a third of the total global workforce, and it’s growing. So I don’t think anyone is against the concept of flexibility. If you are, then you also have to be [against – 14:35] the concept of technology and personal rights and freedom. That certainly exists in some places but not the aggregate. So as a global phenomenon and as a way to level the playing field, everybody talks about trade agreements of this and that. There’s nothing simpler than hiring across borders via technology, nothing simpler than that.
Lisette: A lot of Silicon Valley is not doing that. I know the startup culture in particular wants to have people in the same place because of the speed and the energy, of course.
Frank: Yes, that’s true. But as that startup matures, where do you think their call center is going to be, San Jose? No.
Lisette: It’s not San Francisco [laughs].
Frank: So an importance is you’re building a company to building a core team that has energy and thrives in its community environment. That’s critical to all companies. Once that’s established though and you say, “Well, we need to establish a sales force,” are we going to have all the salespeople at the corporate headquarters flying to the customers? No, we’re not going to do that. We need a programming force that’s going to be doing not the inventive work necessarily but the daily work. Well, does that need I being in San Francisco or Silicon Valley or anywhere? No, we have programmers in our own staff all over the world. We like to work 24/7 as a company. So part of our thought process and work processes for decades now has been to hire 24/7. Don’t have shifts in one place. So our service call centers, our servicing capability of our network of business centers, our customer base, our websites, our programming, our technology base all runs globally, based on the sun, not based on a particular location. I think that that is the way all companies are trending now. We’re not in any way unique, I don’t believe.
Lisette: Indeed. I get a lot of people contacting me saying, “I would love to work remote, but my boss won’t let me. I would love to work from home one day a week, but my boss won’t let me. What can I do?” I have a whole series of advices [crosstalk – 17:11] surprised.
Frank: Yeah. I think there’s still some reluctance. There are still some anachronistic bosses out there that look at things and say, “Well, this is the way we’ve always done it.” The seven most deadly words in business, “This is the way we’ve always done it.” And really, it’s a matter of trust too. Maybe that employee that wants to work remotely isn’t trustworthy. You can’t judge whether they’re doing their work or not unless you can see them. Or maybe the boss is a little bit paranoid and doesn’t believe that he’ll be or she’ll be judged properly unless their boss can see their workforce in front of them. That sense of importance that people have, oftentimes an empowerment from the top-down instead of [inaudible – 18:01] or empowerment from the bottom up, which really makes most successful companies today. Everyone should have 100 percent empowerment to do their job independently.
Lisette: Indeed. We’re hired as professionals, so [crosstalk – 18:19] as professionals, indeed.
Frank: And most people look at me and they say, “Well, you’re so old and funny-looking anyway. We really don’t want to see you.”
Frank: So they force me to work remotely.
Frank: On my own team. But no, [inaudible – 18:35] important characteristic. So I think that the people that are saying, “My boss won’t let me,” their boss really won’t be there or part of the management team very soon.
Lisette: So just wait a while. Hold tight, people [laughs].
Frank: Yeah. Or earn the right. Earn the right. A lot of employees, “I want this. I want that.” You know what? You’re 22 years old, you’ve never done this before, you have no experience, and you want to work out of a coffee shop with highly sensitive material that our company owns that if it’s pirated, but you have to earn the right for independence. And I think that’s true whether it’s political freedom and independence, business freedom and independence, relationship freedom and independence. You have to prove that you have earned that. It’s not a given that you can just have automatically.
Lisette: Right, indeed. You have to show capability, like with anything, absolutely. So you guys are a global company, so you have 700 locations in 47 countries. That’s a lot. And I assume that as a team globally, you’re also communicating with each other. What are some of the things that you guys are challenged by? What’s hard for your company?
Frank: Time zones, of course. My own business schedule here in Newport Beach started yesterday in the Middle East, in Dubai, which is 11 hours difference in time zone, and in Australia, which is another 9 hours difference [crosstalk – 20:12].
Lisette: Did you sleep?
Frank: Yes, I did.
Lisette: [laughs] Okay.
Frank: I got two hours of sleep.
Lisette: Oh no.
Frank: [inaudible – 20:19] the bags under the eye. I think time zones are always a challenge for a team to deal with. Languages are a challenge. Communications are critically important and the nuance of that. But I think as you learn to both communicate, as you learn to do business across borders and time zones, you really make it a much more capable organization. This is a skill set we need. Not just in business but as a world, we need to have comfort in reaching across borders for everything.
The other thing that we like about having our team work remote is if we tell everybody, “Okay, guess what, you’re moving to Newport Beach,” they might have had a very, very lovely home in Australia or very great villa in Dubai. But Newport Beach is going to cost four times as much, so they’re going to have an apartment. How happy are they going to be? How much is it going to cost us to move them? We’re going to have to increase their salaries. We’re going to have to uproot their family. Their kids are going to have to change schools. Socially, so much better to say, “Hey, you really like living in Sydney. You’ve been there all your life. Your family is there. Your connections are there.” Well, why would it matter? You don’t have to come to Newport Beach. You don’t have to come [inaudible – 21:55] any corporate headquarters because of the way that we can work today. I think it’s something you embrace as a benefit from the top-down in a company. I think that allowing people to live where they want and still do the work they would like to do and still feel as if they’re in the mainstream – they’re not out in an extended environment somewhere – that’s a benefit that we can bring to our team members. And honestly, people are quite grateful for it.
Lisette: I believe it, yeah. One thing that comes up though is I have a little manager on this shoulder, like the good angel and the bad manager on the shoulder. And the bad manager says, “But how do I know what people are doing?” How in your company do you guys…?
Frank: I think the bad manager says, “People are working if I see them sitting somewhere 8 hours a day or 10 hours a day,” or in some countries, 12 hours a day, or in some countries, 6. They think that that’s what causes people to work. And it’s really changing job descriptions a little bit, changing how you quantify work. Is it by seeing someone sit at a desk? Does that mean they’re working? Or is it by seeing the productive output that you create? Does that mean they’re working? Take a programmer as a good example. You can tell very quickly if a programmer is working by the amount and the quality of code that they write. That’s not something that requires sitting seen them at a desk to do.
Take your business. You do a lot of writing and blogging and podcasting. Well, if no written articles or blogs or podcasts are coming out, I know you’re not working. It’s very easy to quantify most types of work today through technology.
The other thing is if you want to see me work, I’m logged in right now. Whether I’m logged in at your desk or my desk or in an airplane, I’m logged in. You can see me working. So if that’s your style, it’s very easy to track things. And there are any number of good tools for tracking time, hours, login, screenshots. I can actually see what you’re working on. I can actually see your computer if I want to. I don’t need to see your body. I’d much rather see your screen than the back of your head walking down the road. That’s where productivity comes from. [inaudible – 24:49] the service office [inaudible – 24:51].
Lisette: So speaking of productivity, it actually brings me to my next question. You say that you guys have a 24/7 office and you yourself on two hours of sleep after [a meeting from – 25:05] Dubai to Australia. Really, I do tend to hear a lot that managers are always scared that remote workers aren’t going to work enough. But actually, what ends up happening is that people overwork because they can. And we do have these calls some days. You go from Dubai to Australia. How do you yourself keep your own productivity in check and your own work-life balance in check? Do you have any rules for yourself or hacks that you use?
Frank: I’m kind of a serial entrepreneur. So my life is work-balanced, based around things that I love doing, which is building things. That’s why most fun thing that exists for me is to build something and have others benefit as a result of it. So the concept of not working 24/7 is [inaudible – 26:02]. It’s just something I can’t see. But it brings up a lot of cases.
When remote work started, [inaudible – 26:12] teleworking and telecommuting. The fact that it used tele in the word tells you how old that is.
Frank: And the issue [inaudible – 26:25] if you’re telling me not to work in the office anymore but to work in my home, I may not have a suitable place. I’m a young family and there’s no place. And my wife and child are there with me. And it’s disruptive to my work. So if you’re going to be remote working, you have to make sure that you have a suitable place to do so for your type of work. That doesn’t mean the kitchen table when the family is home. That’s critically important.
The other thing is you’ve heard the old adage a person’s home is their castle. Well, you know, your home is your home. And if you’re going to work remotely, you should work in a workplace, not necessarily your home. If you work in your home, you’re kind of lonely. So you want to work independently but not necessarily by yourself. It’s the concept of business centers, co-working centers where people go to work in a social and business environment, even though they’re all working independently. As human beings, we’re naturally gregarious. We naturally come together. We like that. And it allows people to be much more productive than sitting at their home in a little back bedroom trying to be creative. So you need interaction, and that is very important.
Lisette: What’s one of the main differences between a co-working space and a virtual office, an office that you guys offer, for example?
Frank: Well, nothing except it’s a brand promise. Let’s take the automotive industry as an example. The automotive industries comprised of all providers that combine a chassis, an engine, and a steering wheel, [a little more than that – 28:25] [inaudible]. And brand promise is that we will move you from here to there. That’s what automobiles do. Auto-mobile, it moves you from here to there. Now within the automobile industry, you have different sectors: luxury car sector, sports car sector, family vans, SUVs. And each one of those has a different additional brand promise. We move you from here to there in luxury. We move you from here to there very quickly.
In our industry, we are people, place, and technology, highly flexible service agreement. So all providers of that combination are in our industry. But there are sectors. There’s the classic business center sector. A company like [inaudible – 29:18] would be an example of that, classic business center sector. They combine people, place, and technology. And I’m sure [inaudible – 29:25]. But they [inaudible] it’s a good company. It’s a good company. They’re [inaudible – 29:30] very good company, so I’ll use them. People, place, and technology. And their brand promise is professional image and services. That’s what they promise to deliver with the people, place, and technology.
A co-working center – a group like WeWork, another competitor, another good company – would take people, place, and technology a little different [inaudible – 29:52] maybe but the same three-core elements. And their brand promise would be we provide business growth to our clients through a collaborative community.
Frank: An incubator would say either of those plus mentoring. An accelerator would say, “Hey, an incubator? Access to capital.” A media center would say, “We specialize in the media industry.” A culinary center would say, “We work with [foodies – 30:22].” A logistic center says, “All of those things, but you can have stuff here.” And you can move stuff around you. You can assemble stuff here. So it’s that same combination of things. Just like different automobiles, would you prefer a sports car or a luxury car? It’s the same. Do you prefer a business center or a co-working center?
And what we’re seeing today with generational change, design change, the way people do everything is there’s a bit of a homogenization going on. Business centers are becoming more co-working like and co-working centers are becoming more business-center like. If we look at those two companies [inaudible – 31:02] and we work as an example, we analyze the ratio of the way they’re designing their space in terms of private offices, public space, this sort of thing. They’re very close to each other. Just a little bit different paint job and different style. So Alliance Virtual embraces all of those styles. That’s where we’re different. We don’t say we are one. We say we recognize all, the same way that Expedia recognizes bed and breakfast on up to super luxury resorts. It’s an old saying in the automotive sales industry, there’s a [inaudible – 31:46]. And we kind of take the approach that what you need today may not be what you need tomorrow. So we’re going to see that we have the flexibility, not just in our network [inaudible – 31:58] but industry-wide to service you. And that’s what Alliance Virtual does. It embraces the entire industry, not just our own centers.
Lisette: I love it. When I was first contacted you, when I saw what you guys did, I thought I have to talk to you guys because clearly, this to me is the future of business. It seems very clear this kind of thing is not even the future; it’s the present of business.
Frank: And it’s the past of business for some [inaudible – 32:27].
Lisette: Yeah, indeed. Indeed, it’s just that it’s now catching on because the technology now is becoming so easy and so robust. I mean holograms are just around the corner, and that’s going to just set up a whole new thing.
Frank: You’ll love this. In 1985 or 86, we actually installed our first… we called it a receptionist in a box, but it was a holographic receptionist at the front desk of one of the buildings we were building. This big, clunky box and the mirrors inside of it. And it was like a little Disneyland exhibition with this floating receptionist in it. And nobody liked it. Today, suppose you walk into a center somewhere and you are greeted by a properly positioned holographic receptionist that says, “Hi, how can I help you?” It’s really just in the other room and there’s no magic to it. You would [think anything of it – 33:27].
In fact, there is a video reception service that we’re exploring right now that allows people just to walk into a building. The receptionist is there. They can [inaudible – 33:40]. They want to see it interactively connects their image in the reception area with the person they’re trying to see and opens the doors and does all sorts of things so that they can access the building, access the office [inaudible – 33:53]. There’s a lot of that technology that over the next three to five years will become standard as opposed to being in the experimental stages.
Lisette: Right, yeah, I’m so looking forward to the next five to ten years. I think we’re going to just see some really cool things around the corner.
We’re getting near to the end. I have two more questions that I want to ask. The next question is when people are just starting out, when they’re first contacting you, what are some of the rookie mistakes that they make? What advice do you have for this kind of business?
Frank: Boy, I don’t think our clients make too many rookie mistakes honestly. They need a place to do business. Generally, they’re concerned with office hours or availability or reception hours or things of this nature [inaudible – 34:50] fit there work lifestyle. And there are a lot of easy customization of all of that so that doesn’t be a problem.
Location is critical to most people. They want to know that it’s near the things that they need, either near a client or near maybe their child school or near their home or public transportation or good restaurants. Everybody has a set of location needs generally. And beyond that, they want to feel comfortable. So culturally, you can move into a real super formal, classy business center with a butler. But if you’re sort of a co-working type, you’re not going to be comfortable there. If you have a serious business or you have security needs – maybe you’re doing a very sensitive programming and you have security needs – we have to make sure no one can even look at your [tee strokes – 35:57]. You shouldn’t be in an open co-working center. You should be in a private center that offers privacy and security and secure lines and secure bandwidth structures, all of which are provided or can be provided by a variety of different centers. So it really depends on not mistake so much as knowing your own business and choosing accordingly.
Lisette: Knowing what you need to really [crosstalk – 36:24] business [crosstalk]. It sounds like also not knowing what your business needs but knowing what you might need in the future because you’re providing a space that is flexible and sort of shrinks and expands with you as your business shrinks or expands with time.
Frank: That’s really true. So one of the benefits of our industry at large, Alliance Virtual in particular, is a high degree of flexibility. You don’t know the future. You have no idea what you’re going to do next month. Is your company going to expand? Is it going to contract? Is some event going to take over control of your future for you that you can’t foresee? And what we believe strongly is giving that flexibility to people by not having them have to have long-term commitment. So our day, week, months, one year, that’s it. Companies like to plan a little bit. So they have a yearly contract [inaudible – 37:28] automatically roll over any contract [inaudible] automatically roll over to the next time period. There’s no secession of services ever. But they know that if they need to leave, they can.
In fact, we actually had a program quite a while ago called our jump-start program. Our concept is that we were the place for you to grow your business. No matter what length of agreement you sign, if you were part of our jump-start program – which actually gave you access to a variety of our contracts so it would help you have discounts in your business – you could break your agreement at any time, no matter what [crosstalk – 38:10]. And the reason we did that is that it gave us more notice. People didn’t come to the end of an agreement and say, “Okay, [inaudible – 38:19].” We’re not going to renew. We have a 90-day notice if they’re part of that program. So we could plan our own business better, so it was worth it to give even an extra layer of flexibility over everyone else.
So it’s critical in business today. None of us know. Look at the Brexit vote in the U.K. People didn’t expect it to turn out the way it did. It changed business, part of the financial industry in the city relocate or not. No one knows. And they won’t know it has happened. So would you want to have a 15- or 20-year fixed-office lease for 500 people in the city? Or would you rather have flexibility for maybe half of those people in a serviced office center or a virtual office structure like ours. As an asset manager for an investment company, which would you prefer?
Lisette: Yeah, indeed. My husband is an entrepreneur who has bought an office or has rented an office. And I remember him going through these very same questions when signing the leases. Man, a five-year lease!
Frank: Yeah. What if I grow it 20 percent a year? [inaudible – 39:31] space and the building might not have more space. What if I don’t grow at all and I’ve had to overplan? You have to put that lease liability on your balance sheet. So it’s a debt. A lease is a debt. It’s the debt instrument. So it goes onto your balance sheet, and your balance sheet impacts your banking capabilities. So wouldn’t it be better to have a one-year service agreement that doesn’t go on your balance sheet that you could roll over for five years? That makes you more credit-worthy. And as you’re more credit-worthy, you can grow your company faster.
Lisette: Right. They give you a few more restful nights too where you’re not stressing about.
Frank: Well, it is. That’s why I say a lot of large entities, a lot of large corporations have migrated to our industry for their contract just now. So now the employee base is now workforce base, a lot of independent contractors. And they take those independent contractors out of the corporate headquarters, and they put them into our industry. Why? Think of taking a million square feet of office space out of your balance sheet. How does that impact the [crosstalk – 40:40] stock trends? So a lot of that is going on right now all over the world. And it’s a major shift not just in work lifestyle that we’re talking about but in the economic structure of all companies, in particular, publicly traded companies, stock value is of critical importance.
Lisette: Right. Oh, I just think it’s awesome. One more question before I… I know I said I only had one easy question left. But on your linked profile, it said you’re an expert on third-place working. I’ve never heard that term before. What is third-place working?
Frank: Gosh, I don’t know what it is either.
Lisette: [laughs] [inaudible – 41:24].
Frank: I think the reference to third place is just working in the cloud, working [inaudible – 41:31] pure technology and working across all the virtual platforms we’re talking about today. You could say third place is Starbucks in some respects also. So it’s really just that digital nomad structure.
Lisette: Love it. Love it. So you can be anywhere. Okay, finally, the last, last, really the last question, which is if people want to learn more about Alliance Virtual offices, what’s the best way? The website, clearly. What’s the best way to get in touch?
Frank: alliancevirtualoffices.com, very simple. In the Netherlands where you are, flexato.com, which is another virtual office management company. It’s Dutch-based. It’s part of our group. That’s really about it. If you want to learn more about our industry, then there’s a website called allwork.space. It’s an industry news and information publication that’s published by the alliance group. And it has a ton of information all about our industry. As you will find in the blog section of alliancevirtualoffices.com, just a ton of information about virtual officing topics, how companies use it, the best way to take advantage of it etc., literally, thousands of articles.
Lisette: Yeah, great. I did notice it was quite robust when I visited the site, indeed.
Frank: If you’ve been in business long enough, pretty much you’ve got a big library.
Lisette: Indeed. You get a lot of questions and you start to get them over and over again. So then you think, “Okay, let’s put the…” Indeed. Frank, thank you so much for taking the time to talk today. I really enjoyed the conversation. I really learned a lot. I feel like we might need to have a round 2. There are a whole bunch of more questions.
Frank: Happy to do so.
Lisette: It was awesome. So thanks everybody for listening. And until next time, be powerful.