Business Plan ETHAN SEGAL | +33.6.95.33.75.67 | ETHAN.SEGAL@INVESTINWORK.COM a marketplace for working life There’s a brand new consumer walking around with a lifetime of work-related spending in their pocket. They need places to work, a computer, a pension, healthcare, someone to calculate and pay their taxes, food and drink and everything else employers used to provide on their behalf. It’s not just a few freelancers; everyone who works is having to do more and more themselves (30% of American workers are not working in employers’ offices on any given day; 40% don’t work a contract with benefits; 50% of global workers bring their own devices to work). But a marketplace has yet to emerge that does everything that employers have been doing for them: there’s no IT department, payroll company or HR outside the office; people don’t have access to the same IFAs, accountants and lawyers; and while there are many new places to work, nobody’s really thought about what working life could look like beyond offices now that people are choosing and paying for it themselves. work will create an entirely new marketplace of products and services that fills the hole that employers are leaving behind. Our mission is not to recreate the same quality of working life that employers have been providing for nearly a century now; our mission is to create a better quality of working life now that the individual is choosing and paying for everything themselves. the model All the needs of modern working life arise when people are busy working (i.e. they’re hungry or thirsty, their computer is running slow, they have a tax question when sending out an invoice, etc.). That’s why we need to be the place where people choose to work; by capturing people’s working time, we’ll capture the market. Our business model differs from coworking as a consequence: workspace isn’t the product that we will be selling, it’s the market floor for selling everything else. You can’t sell everything from IT to banking to a small group of the same regular customers sitting upstairs in offices you have to pay to get into; you need a mass market. We will capture it by designing a better quality workspace than currently exists and putting it in public where people can walk in and out of it freely. We will use workspace to buy the new consumer out of all the other places they currently work so that we can sell them everything else they need in modern working life, starting with food and drink. As the customer base expands, we will layer on new products and services until eventually, the lifetime value of each customer far exceeds what we could have ever brought in from renting them the desk and chair rather than giving it away for free. This business will develop in layers layer one: the market floor In the beginning, our undivided attention will be given to the workspace itself and turning a profit from the sale of food and drink alone. We will create a prototype and perfect it until it’s clear that it will act as a magnet for working life wherever it’s replicated. While this business plan explains how we will develop from a public workspace selling just food and drinks into a wider marketplace, the business plan itself is for the launch of the prototype. layer two: advisors Advisors will be introduced into the workspace who will diagnose customer’s needs and prescribe solutions (i.e. they’ll work out whether a slow computer has a virus, is obsolete and needs upgrading, etc.). They’ll be generalists within a specialist field (an Associate in Law, an IT consultant it tech, etc.) equipped to handle the everyday questions themselves while knowing how to navigate the more complicated ones. Solutions that can’t be fulfilled in-house will initially be sourced from outside products and services. We won’t charge for the diagnosis; we’ll earn our income from the solutions. Charging people just to talk to someone will be a psychological barrier that too few will cross. layer three: products and services All the products and services that currently line today’s high streets were never designed to serve working life (Best Buy is not an IT department, business banking is for businesses, not individuals, etc.). A market does exist for working life, but it’s for employers, not individuals. For example, employers lease equipment at wholesale prices; individuals buy them outright at retail prices. Employers access the best private IFAs; individuals buy retirement plans from high street banks. Employers use big payroll companies to calculate and pay taxes; individuals have to find local accountants. This marketplace exists because employers buy on behalf of a large number of employees rather than on an individual basis. We will be able to do the same, but with the potential to scale much larger than any employer ever has. That’s because the individual will be a customer rather than an employee and our goal is to have as many as possible, not as few - and, they will cut across employers. layer one:
THE MARKET FLOOR It won’t be that hard to create a workspace that stands out from everything else. Workspaces today are where hotels were in the 1980s before hip hotels arrived - they satisfy basic needs, but none tap into human desire. That’s because most new workspaces have built their model on office life, which was conceived by employers in a very different era of work when desire was not a consideration. But it will be now that the people working inside them are choosing and paying for it themselves - and because more and more people no longer need to be in one to do their jobs. What follows are 3 qualities that will radically challenge traditional thinking about where work has to be. 3 qualities will draw people out of all the places they currently work and into ours Locations where people love to spend their time. We will take work out of the office and put it in places people love to be. For example, in a park, by the water, inside inspiring architecture - places traditionally associated with play, where work does not currently exist. Environments where people feel good. Literally. The most successful brands have been influencing the way people feel in their spaces by carefully controlling all the variables in their environment. The best hotels, aircraft manufacturers, malls, museums, schools, places of worship and many others have turned environmental psychology into a science. A handful of workspaces have applied a few of the principals, but always as an after-thought - nobody’s made it core to their design. Places that take the monotony out of work. By making work public. It’s the opposite of the home, the office and coworking. Each day in public is different to the one before - it’s not the same boring commute, to sit at the same desk, in front of all the same faces. People love working in cafes for that reason, but cafes aren’t workspaces. Nobody’s taken work public yet. architectural concept We have a high profile French architect working on our team (page 31) whose firm is experienced in developing spaces designed to encourage people’s best work (schools, libraries, etc.). What follows is a draft concept that expresses the long term vision for the space, not the minimum viable product. Once we secure a space, we will scale back to meet the parameters that we have to work within. environmental control We will adopt the latest research from various universities, government institutions, etc. regarding the role that different environmental variables play on human psychology and physiology. We will seek property that is most accommodating of these variables. And we won’t compromise. The quality of the space is far more important to our long term success than the quality of the real estate contract. This will distinguish us from most coworking businesses. Most of them have established themselves as real estate businesses first; the working lives of the customers inside them come second. They sacrifice these qualities that are really important to the consumer. Coworkings’ real estate contracts will probably look much better than ours, but our space will look much better to the consumers who use them and that’s what will ultimately matter over the long term. the one variable that will never be compromised is natural
light Light is an incredibly important regulator of our work day. 
It’s presence tells us that it’s time to work and it’s absence that it’s time to rest. This happens biologically without our awareness - high intensity light in the blue spectrum is a regulator of melatonin, seratonin and cortisol; in layman’s terms, it causes us to feel awake and alert with a general sense of well being. Most places people work are starved of light: the big cafes typically choose deep dark saturated colors that absorb light and dim lighting at the opposite end of the spectrum (red/yellow); most people’s homes are lucky if they get any sun; coworking loves early 20th century lofts where the primary building material was brick. Our primary building material will be glass and our primary color white, and we will seek out locations that face the sun without anything obstructing it. Every aspect of our space will be designed to capture and flood it with natural light and when it’s not available, we’ll synthesize it through the same carefully calibrated lighting systems that airlines, retailers and museums use. smell: The olfactory bulb is linked to the brain’s limbic system which means smell is highly connected to emotions and memories. Peppermint, citrus and woody notes create feelings of energy and alertness, which is why many gyms, shopping centers and airlines release these aromatics through the ventilation system. We will do the same. color: Our primary color will be white to help with light distribution, but it is also shown to inspire clarity. Accents of blue will be incorporated which is associated with calm and tranquility, helping to reduce stress. green will feature through the natural life, which is also a calming color. temperature: Cold temperatures cause people to make mistakes and lose concentration (people focus on the cold rather than work). Climate control is notoriously bad in offices and many public spaces and it’s usually the result of inadequate technology and/or human error. we won’t make those same mistakes - our goal will be a consistent 25°c (77°f) throughout, which is believed to be the optimal temperature, and we’ll use a combination of technologies to achieve it. spatial: Higher ceilings induce feelings of freedom and illicit both greater decision making capabilities and abstract thinking (that’s on top of people’s aesthetic preference for them). High ceilings (or the ability to combine two floors) will be something we seek from our real estate. Achieving the right amount of distance between people will also be important. There is no research we are aware of that states how much and how proximity affects people, so we’ll have to experiment - but we’ve made allowances for a much larger square foot per person in our financials than is typically found in most public spaces. air quality: Poor air quality (high concentrations of co2, pollutants, etc.) is proven to cause drowsiness and loss of concentration. It is the result of poor ventilation systems that fail to circulate air in from outside. This, along with other air quality variables (i.e. humidity), will be controlled by investing in a modern high quality climate control system. perspective: Glass will serve a purpose beyond light distribution - it will give people perspective, which is something most people don’t have with a cubicle wall. sound: Ambient sounds can either help or harm people’s work. various studies show that 50 decibels is the right amount and we will control it with new noise canceling systems that various retailers like apple have started introducing into their stores. natural life: The positive effects of natural life in the working environment are too vast to mention. Along with natural light, natural life will be central to our workspace. connectivity: It goes without saying that uncertainty about internet connectivity and access to power (a problem that everyone has faced when working in public) will not be a feature of our workspace. our space will be wired with the same commercial grade equipment found in the best offices. dim light: High intensity light is conducive to most of the work day, with the exception of creative thinking. It is believed that people are more creative under low level lighting and we will be particularly accommodating of this at night where lighting will be dimmed around the perimeter glass wall (creating dim lit spaces near the windows so people can stare out while they think - imagine airline lounge at night). materials We will exclude any materials that reference the office (office desks and chairs, ceiling and carpet tiles, etc.). Our goal is to present a new vision for working life that’s completely removed from the 20th century one that nobody ever really fell in love with. layout Working life is becoming less of an eight hour day in one place, repeating the same few tasks. It’s much more of a series of varied tasks performed in different locations, each lasting an hour or two and people need different types of workspaces to do them. Some workspaces need to be designed for critical thinking, others for collaboration, and some to stimulate productivity. Our spaces will be divided to meet those different needs. workspace A Most people need periods of concentrated time on their own to get work done. They don’t want to be alone, but they don’t want to be distracted by others. That’s why many people choose public spaces over the home, office or coworking because they’re in the company of strangers (some people describe it as “working in public, alone”). They’re usually the people you see sitting at communal tables in a cafe working on a laptop. but they’re not there just for company; they’re there because they feed off the constant change that’s inherent within public life. It helps them to see the work they’re doing from different perspectives, avoiding the circular thinking that often occurs in static places like the home or the office. This section of our workspace will sit people side by side with strangers at long communal tables with ergonomically designed seating for long duration work. It will be surrounded by glass, each wall looking out onto something different, feeding them a constant stream of stimuli while protecting them from it. workspace b Workspace B is for all the daily interactions people have in modern working life. Interviews, meetings, collaborative work sessions. This space will be distinguished by its round tables and softer touches that aim to make each individual feel equal. Noise canceling systems will make it hard to hear neighboring conversations. workspace c Workspace C serves two very distinct needs. It’s a place for people to think and a place for people to complete short duration, less concentrated tasks (emails, admin, etc.) - they’re usually the people you see on the sofas in a cafe working on a touch device. People will sit at soft chairs; lighting will be dimmer; and, like workspace A, each wall will look out onto something different. It won’t be too dissimilar to a very good airport or hotel lounge. NATURAL LIGHT the building The exterior walls will look out onto the public life that surrounds the building, but they will be soundproof and designed in such a way that people don’t feel exposed. The interior walls of each zone will look into the atrium where they will see natural life and food and drinks. The glass partition will shield them from the noise in the atrium. The ceiling in the atrium will have an opening that floods the space with natural light and the rest of the ceiling will be a giant lighting panel that simulates daylight. Light will be more than just an environmental variable we control; it will be a symbol for work idea Light will not be a functional specification that’s added at the final stage of our build, it will be at the center of our entire design. It’s our identity and logo and the entire roof will project it as the primary signage for the store. It’s not just because of the way in which the sun’s light effects us, but also because the sun and the deep blue sky is a symbol that’s universally positive all around the world - it makes everyone feel happy when they see it. It will literally shine a light onto work (something that is not always seen as a positive), helping people to see work as a good word. This is not the actual picture of the workspace; it is merely a first draft expression of the concept. We will reach the mass market with our workspace by being in places where working life is most concentrated In CITIES with the worlds’ best labor markets* cities with the highest quantity of jobs: Those with over a million jobs, where the economy is expanding rather than contracting, with a higher diversity of work (i.e. where the local economy isn’t dependent on just one sector) and where the participation rates are high (where people are either working or looking for work). cities with the highest quality of jobs: Those that have work with a higher median income and more highly skilled jobs (e.g. knowledge work). At the INTERSECTIONS of diverse working lives Zones with the highest volume of jobs within a 30 minute commuting radius - these are the places in between lots of different working zones. These intersections are typically right in the center of a city near a major transport hub that links several clusters together (e.g. the financial district, the creative area, a science and technology corridor, government, a university, etc.) - places where the creative crosses paths with a banker. For example, in Paris, it’s the 20 IRIS census zones near Gare Saint-Lazare and the Opera, each of which have over 2 million jobs within their radius; it’s not places like Canal St. Martin (a popular coworking location) with less than a million jobs in its radius and a heavy bias towards creative industries. Along the ARTERIES that all working lives traverse By installing work on the ground floor in public retail space rather than upstairs in commercial office space. Everyone travels through retail (they are like highways), but only a small group of the same regular people ever go upstairs into any one office above (they are like dead-end residential streets). While coworking businesses are all competing to lock down the best commercial office real estate, we’ll be busy finding the best retail. *See appendix C for a list of cities. 
The pilot will be situated in the city offering the best prospects for getting started (finance, people, connections, real estate, etc.). The working customer eats differently from the restaurant customer. our food and drink will be designed for work SMALLER PORTIONS Our peak traffic will be in between meals - the opposite of restaurants. This is when most people are working. People will eat with us outside of mealtimes because we will offer them smaller portions than a full meal - ⅓ the size - which will satisfy any appetite throughout the day. People who want a full meal can buy more containers. VARIATION People will work in our space much more frequently than they would ever eat at the same place (eating the same thing over and over is off-putting; working in the same place is not). People will eat with us day after day if every time they walk up to the food display they feel they are walking into a different restaurant. That’s why we won’t make our own brand of food - we’ll bring in everyone else’s instead. We will curate food from the city’s most popular restaurants, choosing signature dishes with a low glycemic index (keeping peoples’ energy levels constant while working). We will repackage it in our own uniform containers with a label on the side displaying who it’s from so that people see that we are going beyond simply delivering food - it makes the curation explicit and allows us to project our identity onto the food. And we will do the same with drinks (e.g. buying local craft coffee beans). This is not as complicated as it may sound - Uber Eats, Forkable, etc. have already laid the groundwork. SPEED Customers who work stay longer. Someone who works stays 100 minutes on average versus 30 for someone who doesn’t. (We know this from 500 hours observing people at work in cafes.) People usually only order more than once if they don’t have to wait in line again (i.e. someone takes their order). We won’t have lines; customers will pick up their food and pay for it themselves through one of our terminals or on one of their devices. They’ll also order and pay for their drinks this way, which they can either pick up themselves or have delivered to the table where they’re working. reservations Sometimes people need the guarantee of a table and chair, which is currently one of the major drawbacks of working in public places. We’ll satisfy that need by having a select number of tables that can be reserved by the hour for a fee. In this way, we’ll attract the people sitting upstairs in coworking who are only there for the guarantee of a table and chair. Reservations will be limited to a few tables, so that we don’t sacrifice the mass market only to end up with the same niche audience that coworking’s got upstairs. The pricing model will also help - charging by the half hour psychologically encourages people to be efficient with their reservations (just like car sharing), so that there will always be free tables in the reservation app. Our marketing will concentrate on the image of a better quality of working life A better quality of working life is the idea that our marketing will portray and workspace will be the medium for conveying it. People don’t dream about pensions. They dream about a better quality of working life. Quality of working life is the sum of many parts, but people feel it most in the physical spaces they work. You can’t see, hear, smell, touch or taste a pension, but space touches all these senses. That’s why space is so important - it’s selling an idea that’s far more valuable to people than everything sold inside it. Without physical space, people will simply see products and services; but with it, everything becomes a purchase towards a better quality of working life. The space itself will be a local mass market medium. It will be in prime city center real estate that people will pass by on their way to work - they’ll literally see into a better quality of working life on their way to an office. All other media channels we use will help people to see it who aren’t standing right in front of it. Layer Two advisors Layer One concentrates all the needs and problems people have in modern working life into our space. layer two starts to address them Everyone needs a pension, equipment or healthcare but getting them is another story when you can’t rely on someone in a Finance, IT or HR department to sort it out for you (where all you have to do is tick a few boxes). A lot of people we listened to don’t have these things (or struggle with them) not because they can’t afford them or because you can’t buy them on your own, but because they can’t understand them. The need isn’t to be educated on all these complicated subjects (people don’t want to become IT specialists, lawyers or accountants) - the need is for someone they trust to take away these things away and deal with them like employers have been doing. That’s where our advisors come in. THE NEED is real - we heard it ourselves And that’s why people will come to our advisors We have talked to a lot of people in the hours that we have spent in public spaces where people work. What we hear is a single recurring theme that runs through all the different particular stresses that people are facing without the support of an employer. All of them are losing something without gaining something in return. Our advisors will take over this role. “…I do save, but it’s just sitting in a savings account. I don’t know how to invest and I have no idea where you go for that kind of thing...” “My biggest problem is getting paid. I work for big companies but they take forever to pay - I have to call them up and harass them, which I find uncomfortable and awkward, but these people just can’t understand what it’s like not to be paid - they’ve never had their paycheck come late...” “Everyone I know gets some money each month from the government for childcare except me - my employer doesn’t do it for contractors.” “I never really know how much money is mine and what I’m going to have to pay in taxes until I actually work it out at the end of the quarter and by that time, I’ve usually spent it…” “I’ve got terrible teeth, which my last employer’s insurance used to cover, but my own doesn’t - I thought it did when I signed up for the dental option, but it doesn’t.” “Excuse me, but you look like someone who knows about computers, can you help me? My computer keeps turning off and on and I’m not doing anything…” the business of advisors Prior to launch, we will introduce people dressed in blue into the space to serve two purposes. They will be a pre-launch advertisement for the service (unlike food and drink, it’s a new concept that will need to be explained to people) and they’ll be surveying which needs and problems are most prevalent. This will help us to focus on which types of knowledge and skills to recruit first for our launch advisors. Our advisor proposition will be not too dissimilar to a professional services firm covering multiple disciplines (accounting, technology, law, etc.), but it will target a totally new market of consumers with a very different proposition. We will focus on high volume, low value transactions from the mass market (the big professional services firms target the exact opposite). For example, drafting contracts rather than major litigation; fixing a laptop rather than setting up an enterprise system; etc. Our typical interface with a customer will therefore be with a far lower cost generalist (It’s not an IT Principal or a Partner in a law firm, it’s a law associate or an IT consultant that comes round and fixes your computer). People will make appointments with an advisor and receive a diagnosis without a fee (much like with a genius at Apple); they will be given a quote for the solution. People can take their diagnosis elsewhere, just like you can at Apple, but most won’t. That’s because what they’ll be paying for is someone they trust unconditionally to take their problem away and solve it just like employers have been doing. Someone who guarantees everything like Amazon and with the same level of customer service as Zappos - these will be the reasons that work will be the starting and ending point to any need or problem - and why people will pay a premium for it. WE WILL TAKE ADVISORS TO ALL THE OTHER PLACES PEOPLE WORK Going to where people already are will allow us to expand much faster Once the advisors gain momentum, we need to expand faster than we can build branches. We need to take our advisors to locations where people are already working. The world’s largest office is the cafe; we will make them a major distribution channel. We don’t see the cafe as competition and we don’t think that they will see it this way either - we won’t be selling food and drink in their space and we’ll be selling their’s in ours (see food and drink concept) in a model that Starbucks, Costa and others have already implemented in hotels, service stations, grocery stores, etc. We don’t need Starbucks on day one; we just need one local cafe with a small network of stores in our launch city to say yes. Once we’ve proven the concept with one small chain, the larger ones will be easier to convince to come on board. Online isn’t our first distribution channel - it’s our last Most people will eventually reach our advisors online - it will become our most important distribution channel. But we can’t start there, we have to start in stores. Advisors are a new concept that the public will be unfamiliar with and we’re going to have to establish a level of trust given the subject matter of the conversations we hope to have with customers (finance, legal, etc). This is a lot easier to do face-to-face than online - there’s a lot more for the customer to evaluate. We will carefully craft and control that experience (just like with the space) with everything from the type of person we recruit to the clothes they wear. And we won’t call them advisors, we just haven’t found a name that we feel will resonate with the public yet. Our goal is to plant a picture of the advisors in people’s heads so that when they’re speaking to one online or over the phone that they can’t see, they’re imagining the same person. Layer 3 products and services a brand new marketplace for working life As our customer base scales, we will start to build a new marketplace of products and services that specialize in serving working life. It won’t exclusively sell our own products and services; it will be an open marketplace that encourages and incentivizes others to become solutions that our advisors recommend and sell. This will both help establish the integrity of the answers our advisors provide (as their recommendations will incorporate a review of all the products and services in the marketplace and not just our own), and it will ensure that our marketplace becomes complete - the needs of working life are just too vast and complicated for any one brand to solve. But we will design our own products and services where we see a very strong business case and believe that we can do it better than others. For everything else, we’ll take a cut for being the marketplace where they sell their products and services. We see a particularly strong business case for creating 3 products and Services ourselves The first public it department Customers will start to see advisors as the new IT department. They’ll see someone who’s independent of technology brands and retailers, who can help them to research, price compare, negotiate, insure, purchase, secure, backup, problem solve, upgrade and all the other things that IT departments do inside companies, that most people take for granted. They’ll stop trying to fill these holes through places like Best Buy, who never set themselves up to be a replacement for IT - they’re mostly just tech retailers. But even with advisors, customers still have the burden of buying and owning the equipment which means they have to pay a large sum upfront - which they have to pay each time they want to upgrade (encouraging people to hang on to equipment longer than an employee ever would). We will take away this burden by bringing a new model to tech which has been used by the car industry for years - the lease. And we’ll package it together with the advisors and insurance, to completely eliminate the burden so that people start to see technology as a rental rather than a purchase. The first consumer market for professional services Customers will start to see advisors as the starting point to all the subjects that are really difficult to understand. They’ll come to advisors for help with employment contracts (especially people who no longer work a full-time contract and might be working more than one at the same time - many of which aren’t even employment contracts at all anymore); they’ll ask for help calculating and paying their taxes (especially those who are no longer paid by employers through payroll companies); or they might want help working out how best to invest for retirement (especially those who no longer have access to employer programs staffed with some of the best IFAs). In Layer Two, Advisors will call upon the existing professional services market for solutions they can’t handle themselves. In Layer Three, we’ll build a professional services organization that specializes in work and employment. We’ll recruit the specialists we need to be able to answer questions in-house while also exploring products and services in the startup community that are disrupting the way that professional services is delivered. A major arm of this new firm will be a new type of payroll company - one for all the people who no longer get paid through one. It will take people’s gross incomes (from all its sources) and turn them into something that resembles a regular paycheck each month (this is big business - the American payroll company ADP has an annual turnover of $12 billion). However, unlike payroll companies today (where the employer is the customer and not the employee), it won’t just unconditionally pay the government the maximum; it will seek to ensure that our customers are being as tax efficient as the law allows. A bank for working life The most difficult challenge that more and more people are facing in modern working life is figuring out how to live without a single consistent paycheck from one employer each month where everything has already been accounted for (tax, healthcare, pensions, business expenses paid for by the employer, etc.). Everyday, more and more people are getting paid gross and they’re earning their income from multiple sources. We will create a new separate financial space that specializes exclusively in people’s working lives (because personal banking is designed for domestic life and business banking is for legal business entities, not people). It will include products and services like a checking/current account for working life money (keeping pre-tax money separate from domestic finances); accounting tools that help people manage their working finances as if it were a business; annuity-like products that smooth out erratic and sporadic income while also helping people to save for retirement. The deposits that the bank accumulates will be loaned / invested back out to the same customers who put them there. We will provide credit for all the bigger ticket purchases that employers used to pay for, but which traditional banks are not in the business of funding (equipment, education, etc.). We will provide a working capital line of credit to all the individuals who work as if they were a company, but aren’t (i.e. a freelancer who needs to make upfront purchases to complete a gig before they get paid). And we’ll help the individual to fund their projects and ideas (from micro loans to seed funding). We’ll be in a unique position to do all this because our advisors will have a richer set of data about this customer than anyone else - they’ll be able to risk profile them in a way that traditional banks can’t. For everything else, we will encourage a new marketplace to develop around us by Taking work out of the office and putting it in retail space Putting work in retail space will give business access to a new consumer that they never had access to before. People need products and services right next to them when they’re working, but most people work at a distance from commerce either literally (because they’re in office parks or at home) or psychologically (because they’re in offices above retail space). Carving out a space for work in retail with advisors who activate all the latent needs people have will help business to see the opportunity and set up shop around us. We have an ulterior motive for encouraging a new marketplace to form around us. We need the best prime real estate in city centers on favorable terms. Bringing a new sector of business to retail property owners along with a new stream of foot traffic will achieve this, especially at a time when they’re concerned about a long term decline that’s occurring in retail due to e-commerce. Retail owners are trying to address the problem with more restaurants and entertainment, but people only have so much time for it. But work is the thing that people spend more time doing than anything else in life - putting it there will flood city centers with new traffic (in particular, between the hours of 9-5, from Monday to Friday, when retail traffic is traditionally light). It will make us a totally new type of anchor, and anchors get the best places at better prices because retail property owners can’t live without them. OUR MISSION IS TO CREATE a better quality of working life Many people still receive everything they need in working life from their employers (and a few employers are making headlines for doing it really well). But the overall trend is that more and more employers are doing less. Managing people’s entire working lives is a burden and an expense that was necessary last century, but is much less relevant to the work people are increasingly doing today. Creating a new infrastructure that takes the place of employers will help advance the trend - creating one that provides a better quality of working life than the one that employers provided will prompt people to start to demand it (and those employers who deny it will lose the best talent). What’s more, as they start to own and control their working lives themselves (with portable products and services that they take with them from employer to employer), their decisions about where to work will no longer be influenced by anything other than the work itself and the pay. Layers One, Two and Three together focus on building the infrastructure that will make independent working life outside the office much better than inside it. But, a better quality of working life is just the first step on a path towards a much bigger vision... OUR VISION IS TO make work a good word Better pensions, IT, etc. will improve quality of working life, but it won’t fundamentally change the way people feel about work itself. So many people see work as a bad word because they don’t love what they do. As people start to see us as the place to turn to for answers, they’ll start to ask more and more questions. Instead of asking us which computer to buy, they’ll start asking how to do things with it that lead to the work they really want to do. We will answer these questions and expand our marketplace of products and service to cover them (e.g. education, marketing services to help people better market themselves for the jobs they really want, larger sources of funding for new ideas, etc.). 
The more that we help people into work that they love doing, the more that people will see work as a good word. core team Two of us have known each other for fifteen years; the three of us for five. What defines us as a team is our differences, not our similarities. We were each born and/or have lived in different countries, we’ve worked very different unrelated careers and we are a mixed gender team. We each see the world through very different eyes, which means we don’t always agree. But as we’re in our 40s rather than our 20s, these differences don’t serve to split us apart - they make us stronger. This is the core team that will make work their life’s work. ETHAN SEGAL Ethan Segal has been a founder of several advertising agencies. These agencies became multi-million dollar businesses with 50+ staff handling clients like British Airways, The BBC and Orange. One was bought by MandC Saatchi; another is now part of TBWA. All of them became among the top ten most heavily awarded in their field. Ethan was Strategy Director, but having started these agencies with no clients, revenue or staff, he was used to doing just about everything from leading pitches and client accounts to writing ads. l K @ +33 6 95 33 75 67 JODY POU Jody Pou has built her own independent creative brand in diverse artistic fields. She created the start-up netlabel, shskh.com, for which she commissioned pieces and directed recording sessions in NYC studios (Avatar and Clinton). Her books have been published by the French National Book Center. She has won two first prizes from the Paris Conservatory and has sung as a soloist at the Paris Opera. She’s also a visual artist selling her work on the Saatchi Gallery online. Jody brings retail and real estate experience to the team too - she’s Vice President of her family’s retail property corporation. She brings knowledge in everything from tenant negotiations to city council ordinances. l K @ +33 6 72 13 40 95 ALEX LEDSOM Alex Ledsom has over twenty years experience in Project Management and Operations both in consultancy firms and large multinational blue chip organizations (J.P.Morgan Private Bank, International Herald Tribune, the UK Government). She has run multiple projects and teams of different sizes, mentoring staff and managing client expectations. She has sat on Management Boards, helping to reduce overheads and increase productivity, as well as being responsible for business forecasting, revenue projections and company strategy. l K @ +33 6 52 36 77 07 K core hires We are going to need a few specialists to join our team once the pilot is proven. RETAIL and REAL ESTATE We are going to need someone very experienced in running, managing and scaling a retail business. Our ideal candidate would come from either luxury or a company whose brand is worth more than all the other assets combined on the balance sheet. Someone who understands that space isn’t about selling, it’s about branding. Someone who obsesses about every little detail inside the space and all around it and how it ultimately affects the way the customer perceives the brand. FOOD and DRINK We are not looking for a chef - we aren’t making anything other than drinks. We are looking for someone who understands the general tastes of the wider public and the trends in the food and drink industry combined with strong connections within the food and drink business community. Someone who can ultimately forge relationships with the best local food and drink businesses. This might be a critic for a major publication, a director at one of the companies that supply these same restaurants or a director of a trendy food hall. ADVISORS This is not a core hire at the beginning of Layer One; it’s a hire that will come closer to the end of it. We’re going to need someone who has a broad understanding of all the disciplines in the Professional Services industry as well as the current trends that are beginning to disrupt these centuries-old industries. Not an academic, but someone with practical on-the-ground experience. We think this person will come from one of the major Management Consultancies who have practices that cover the different disciplines (Law, Accounting, Technology, etc.). stéphane Fernandez fernandez-serres-architecte.com Stéphane Fernandez’s work focuses heavily on the environmental experience. He has built numerous spaces where the core concept is to inspire intellectual pursuit: schools mediatheques, etc. His firm, Fernandez and Serres has won them several prizes* in the subject. Stéphane studied at the prestigious Ecole Polytechnique Fédérale de Lausanne (EPFL) in Switzerland, and the Luminy French architectural school in Marseille. In addition to managing his company, Stéphane is also a PFE Master teacher at French architectural Luminy school in Marseille. *Prize-winner « Nouveaux Albums des Jeunes Architectures » French Culture and Communication Ministry; Finalist AR+D Awards Emerging Architecture 2014; nominated for the European Union Prize for Contemporary Architecture – Mies van der Rohe Awards London 2013; Prize winner for AR_EA Emerging Architecture Awards 2015 Barbican Center London; Prize winner for French Cultural Youth and Sport Monitor Price « Equerre d’argent 2015 » financials Projections for the food and drink business were built from the traffic that passes through Starbucks every day who use it as a workspace. It’s the closest business to model revenue upon - more people work there than any other place and they sell food and drink. We collected the data for working traffic ourselves (stripping out leisure customers) from the 500 hours spent in their stores and verified it against Starbucks annual reports - we feel confident about these projections. What we don’t feel confident about is projecting the scale of the business beyond food and drink. Every new product and service will have a different business model and costs and will require a lot of planning before a projection of any meaning can be made. What we do know is the scale of the business that’s been supporting employers. Employers are spending roughly $25,000 on each employee after salary*. This money goes to a lot of places like payroll companies (who charge a few dollars for every paycheck), technology leasing firms ($1,500 per employee each year), real estate and associated costs ($11,000 per employee each year), training ($1,200 per employee each year) and many others. The scale of what individuals spend outside employers is very hard to measure (this is a new trend and many products and services to serve the new consumer have not yet been invented), but WeWork’s valuation of $20 billion offers an early indication of what investors are predicting this new consumer is worth - $550,000 per customer. *This number varies widely from employer to employer (companies like Google spend much more; McDonald’s much less). revenue GENERAL ASSUMPTIONS The following distinguishes work foot traffic from normal cafe foot traffic and our forecasts reflect this: Peak work traffic is from 9am to 12pm and from 2pm to 5pm, Monday to Friday (particularly the front part of the week) and lower in summer; basically the opposite of a non-working traffic. People worked on weekends and after-hours, but not as much as during the week within normal working hours - some people’s working hours are changing, but not as much as is often claimed - for the most part, we saw that the bulk of people still work traditional hours. People who work stay longer and order more food and drink (given the right conditions) than people who don’t. As detailed earlier, our food and drink product will be tailored to these differences to lift sales per customer. As a consequence, we’ve raised revenue per order and increased order frequency proportionately to reflect the longer stay. It was based on an assumption of 1 drink every 45 minutes (or part thereof) and 50% of customers eating (rather than roughly 20% at Starbucks). We added the following assumptions to reflect how we are designing our business differently from Starbucks: We will have far fewer stores, but they’ll be much bigger. This is because working life is concentrated in city centers with a much larger catchment than cafes; people travel much further for work than for a cup of coffee. Our stores will be a minimum of 300 square meters (versus 150 square meters on average for Starbucks) and as a result, we’ve forecasted 1.25× foot traffic. (It won’t be twice as much foot traffic because customers stay longer - ordering more - and because the square meters per person will be greater). There’s no place to work for everyone who’s working outside normal hours. It’s a tiny group of people relative to normal working hours, but when you combine them together (in modern city centers where they are most concentrated), we suspect it’s not insignificant (especially when you think about all the people working in their homes when everyone’s closed). We’ll be open 24 hours but with a skeleton crew after-hours. We’ve added a modest estimate of sales over the nighttime period (based on a few observations inside 24-hour city center food establishments). Reservations: There are very few places where you can reserve a place to work in public so there is nothing to use as a model for reservation revenue. We’ve therefore made a very modest estimate that will not materially affect the financials of the business if it does not prove true (6% of revenue). revenue FOOT-TRAFFIC *Appendix A for full foot-traffic methodology and figures We observed four profiles of work customers with different consumption habits. We’ve classified them by the length of time they stay. We built separate foot-traffic models for each of these segments (applying our assumptions from the previous page to each segment) to get to a total revenue figure. The first two segments (who stay 235 minutes - 5% of traffic - and 100 minutes - 26% of traffic) are all the people you see in a cafe on their laptops sitting at the communal tables, all fighting for a single outlet. They’re working solitary. A fifth profile we saw was take-away. We too expect take-away traffic and will design our food and drink packaging accordingly, but we project it to be less than at Starbucks (25% versus 35% of orders at Starbucks) because at it’s heart, Starbucks is about coffee (which is a takeaway product) and we are about work (which is a sit-in product). The 43 minute segment (14% of traffic) are working interactively (meetings, interviews, collaborative work sessions, etc.), usually at a round bistro table. The 31 minute segment (29% of traffic) are all the people you see in a cafe working (not playing) on their touch devices (e.g. emails, calls, etc.) usually sitting on the sofas. It’s much less intensive work than the 235 minute and 100 minute segments. A business owner’s worst fear is a work customer who stays all day sipping an espresso. We didn’t see this. The longest anyone stayed was 354 minutes (and it was an extreme outlier), and nearly everyone ordered much more than just the cheapest drink. Average duration for all working segments combined formed a bell curve with a long tail, with most data points clustered around 100 minutes with a standard deviation of 71 minutes. revenue PRICING Our principle for pricing is to position ourselves at the high end of the middle of fast casual establishments. Not cheap and not expensive or luxury. Our meals (⅓ portions) will all be the same price. This is mostly to make automated payment more simple and efficient than we’ve seen elsewhere (because the quicker and easier it is to order, the more frequent our busy working customers will order) - people will simply enter the number of units purchased rather than scroll through menus. This won’t affect our profit margin as we will be paying partner restaurants a fixed price (see expenses). The price of our ⅓ portions to the customer will be €3.50. Having observed prices at many high quality fast casual restaurants, €10.50 (for 3 portions, or a full meal without drinks) was at the high end of the middle. The price of our drinks will be variable. We will be buying raw ingredients and making them ourselves (which means our profitability will be affected by price fluctuations in commodity markets). Unlike food, people will have to scroll through menus to find the drink they want (whether pricing is fixed or not, because you can’t just pick up a Skim Latte out of a food cabinet), but our ordering app will be built in with favorites, previous orders, etc. For the purposes of this business plan, we used €3.50 as an average order per each 45 minute increment. €3.50 sits in between espresso and fruit-based drinks (in various places we visited) and it represents the average price of the wide menu of coffees with milk (lattes, cappuccinos, etc) which were the most common drinks for the working customer. We priced reservations at €2.50 per half hour. This is cheap enough for people to reserve for even the longest work sessions (€10 for the 235 minute session) but expensive enough to discourage them from blocking out the table all day (€60 for 24 hours). revenue FIVE YEAR PROJECTIONS Appendix B for full revenue methodology and figures Our revenue projection is modeled on year 5, when the business has established itself. We applied a discount to years 1-4 to account for the fact that our business needs time to grow. This discount was based on what other food and drink businesses do. The revenue projection per branch places us in the middle of some well known fast food and fast casual restaurant brands. As a point of reference, the pilot will be the equivalent of starting a business that’s the size of a single branch of McDonald’s. expenses RUNNING COSTS - ASSUMPTIONS Our principle for pricing everything in this business - from the building materials to the coffee bean - is quality - quality is how we intend to win over this new consumer. FOOD: Each ⅓ serving will cost us €2. A ⅓ portion is 250ml. After packaging and presentation, 250ml is actually more like 200ml. We’ve estimated the price of quality raw ingredients, bought in bulk for this portion size, as €1. That gives partner restaurants a 100% markup. As we will be buying from multiple locations, we’ll be in a position to negotiate. There are no kitchen costs, but we’ve included costs for delivery, stocking, storage, health and safety, etc. DRINK: The cost of each drink is variable depending on the drink itself, but we’ve priced them with the highest quality raw ingredients. LABOR: as detailed earlier, automation will play a major role in this business. A one time capital investment in technology will strip out a lot of low wage labor (and all associated costs with recruitment, benefits, etc) while maximizing sales per customer by getting rid of lines. Our financials reflect this (although they represent a very base-line technology that will be sufficient for the pilot; it will need further investment when the business scales). Costs for the low wage labor that can’t yet be automated have been factored in (security, cleaning, hosts, etc.). For the higher skilled jobs, like managers and genuine baristas (who will interface with customers), we hire the best and pay them well. RENT: 300m2 in prime city center retail real estate. This is not for property on the most expensive streets (Champs-Élysées, Fifth Avenue, etc.), but rather for desirable streets within those same prime zones. It is the average for some of the world’s larger cities (Paris, New York, San Francisco). This figure will be significantly lower in smaller markets listed in Appendix C. We gathered this data from a combination of sources (various reports from major real estate firms, local listings, etc.). For everything else, quality was researched and priced in where it needs to be (e.g. a high quality commercial Internet package with redundancies). All of these costs include wastage, theft, staff discounts, customer compensations, etc. PROFIT and LOSS Y1-Y5 Profit and Loss for a single unit of work selling food, drinks and reservations over five years, in total isolation of any other growth that occurs within those five years from new products and services. This is the expenditure for a minimum viable product, renovating an existing space rather than a new build. When the concept is proven, we expect this figure to rise significantly per branch given the importance of space in building the brand. Conversely, we expect the cost of space to become proportionately smaller in the overall financial picture as more and more products and services are introduced and sold through the same spaces (at which point we see space becoming a marketing line item). As a point of reference, a single branch of McDonald’s can cost $550k to renovate an existing space and between $1-2 million to construct depending upon geography, size etc. A branch of Starbucks (at least half the size with far less equipment) is between $350k - $500k to renovate (they rarely build). An Apple Store can cost $1-2 million to renovate an existing space and $8.5 - $10 million for a new build (and their flagships are much higher - the new San Francisco store was $23.6 million). Real estate Key Money is not included as it could vary anywhere from €0 (in real estate markets where key money is not paid) to €1 million (which is what Starbucks budgeted for their Ipanema store). We also excluded this cost because in most cases, the key money is fully recoverable. Tenant improvement is not calculated in these costs and we expect renovation to come down slightly as a result. In the US. it would be roughly $100,000 for this type of contract. Salaries for the core team have been kept off the PandL. That’s because it’s the PandL for a single unit of work and as the business scales, no single unit of work will ever carry their full cost nor will they be necessary to the day to day operations of any single unit. The core team will take a salary that’s below what they’ve previously earned. They’ve already invested over two years of labor without pay. The same goes for the architect, who has produced concepts for the workspace without pay. payback period If this was a business plan for a single unit of work that never expanded... If the core team filled the roles of the people we intend to hire to run a single unit of work and we only ever sold food, drink and reservations in a single unit of work, the payback period would be in year 9. This is long for a restaurant (although not for a hotel), but this is not a business plan for a restaurant. The high cost of the workspace is targeting much more than just the eating and drinking wallets of our customers, but satisfying all those needs on day one is unrealistic. This seed funding is ultimately an investment into the longer term vision - It will fund the prototype that will earn us the new consumer. Further rounds of funding will transform us from a workspace selling food, drink and reservations into an entire marketplace for working life. *Tax will be dependent upon local market rates, but we’ve chosen to be conservative. We’ve applied the relatively high rate of tax in France (33%) rather than a market with a low rate of tax like Ireland (12.5%), for example. appendix a FINANCIALS: FOOT-TRAFFIC METHODOLOGY FOOT TRAFFIC ORDERS PER 30 MINUTE PERIOD PER AUDIENCE SEGMENT The model was constructed by observing orders and their values in Starbucks. We recorded 550 orders. From this group, we followed a sample of people to record what they did (work or play) and how long they stayed - this allowed us to build a model from the people working in Starbucks, stripping out everyone who was playing. We created a model for each of the different segments of work, applying all our assumptions to them (larger food sales, a multiplier for time spent in store, etc.). To this, we added a conservative estimate for overnight traffic. To be sure that the data we collected was representative of Starbucks globally, we verified it through their annual financial statements. Starbucks do not report sales per unit, but we divided total sales by number of branches and our sample came within a 4% margin of error. appendix b FINANCIALS: REVENUE METHODOLOGY REVENUE REVENUE PER 30 MINUTE PERIOD PER AUDIENCE SEGMENT - FOOD and DRINK To get to revenue, we multiplied tickets with our unit pricing (€3.50). In our model, 100% of customers order drinks (the number of drinks dependent upon their length of stay) and 50% of customers order one unit of food (75% for the 235 minute segment). REVENUE REVENUE PER 30 MINUTE PERIOD PER AUDIENCE SEGMENT - RESERVATIONS We assumed that 3 of the 4 segments will see a need at some point for reservations (the 31-minute being excluded as they are more spontaneous visits) and that reservations traffic would concentrate around peak times when it will be hard to get a table. Outside peak, it tails off abruptly with zero revenue throughout the night when it’s almost certain that people won’t need a reservation. ANNUALIZED REVENUE To transform total daily revenue to annual revenue, we first applied a multiplier to each day of the week and then another to each month of year to reflect the weekly and seasonal variances we either saw or expect to see from work traffic. appendix c CITY RESEARCH bigger doesn’t mean better. it just means bigger. All of these cities have thriving modern labor markets. Some are just bigger markets than others, with more jobs. More jobs means more customers before having to expand to other cities. Conversely, the presence of a first unit in a smaller market will be much more widely felt - in some, one unit could make work a local household name. What’s more, retail rates in prime zones are significantly lower in smaller markets. 10M+ JOBS NEW YORK LONDON PARIS SEOUL LOS ANGELES TOKYO BEIJING SHANGHAI 3-5M JOBS SAN FRANCISCO/SAN JOSE BOSTON CHICAGO WASHINGTON TORONTO BERLIN MADRID MILAN AMSTERDAM DÜSSELDORF ISTANBUL MOSCOW DUBAI HONG KONG SINGAPORE SHENZHEN GUANGZHOU TAIPEI KITAKYUSHU-FUKUOKA BUSAN-ULSAN OSAKA-KOBE 1-3M JOBS vancouver seattle portland san diego phoenix denver austin dallas houston atlanta miami montreal lisbon barcelona rome turin zurich munich stuttgart karlsruhe franfurt brussels dublin vienna prague hannover hamburg warsaw copenhagen stockholm helsinki oslo tel aviv st. petersburg perth melbourne sydney All cities with an economically active population (the percentage of a city’s population of working age who are actively engaged in labor market) and with a high percentage of country’s workforce. All cities with employment growth - where demand for jobs is increasing rather than decreasing across sectors based in an office, i.e. not construction worker growth in Miami. All cities with a diversity of industries - where jobs are not tied to one sector on which we would be too dependent. All cities with high quality jobs (e.g. knowledge work). All cities with high median household income rates - where they can afford our products and services. Sources: The Brookings Institute, Global Metro Monitor; Deloitte, 2016 WWW.INVESTINWORK.COM ETHAN SEGAL | +33.6.95.33.75.67 | ETHAN.SEGAL@INVESTINWORK.COM