Adam Segal is in his late 30's and very much a part of the millennial generation. Segal – like so many others of his generation – busts his you-know-what every day.
He's one of the owners of a company called Cove, a chain of neighborhood workspaces with five locations in Washington, D.C. and Boston, and plans for continued expansion. Cove also has propriety technology that manages its offices and helps to create an engaging and collaborative workspace for its members. Segal, a Boston native, started the business in 2013 with a friend from graduate school and has grown the company to more than 50 employees with a number of investors, including the ride-sharing service Uber. He has done all this while raising two small children.
Although I started my own business when Segal was just 14 years old, it was me who was the student of his entrepreneurship during a recent conversation I had with him in his offices. So what did I learn?
Lesson 1: Great businesses are built from existing models.
I meet a lot of people who start their businesses with ideas that they believe have never been done before. Let's get real, everyone: this is 2019. Humans have been doing business for tens of thousands of years. The reality is everything has been done before. Think Uber is so unique? There were people sharing their chariots in Caesar's Rome. Did Facebook change the world? Not any more than a church gathering did in medieval times. Great companies take existing models and improve upon them. The best businesses take existing ideas and make them better.
That's what Segal figured out. He looked at all the people doing work at coffee shops and realized that those places had many drawbacks that were not conducive to productivity. That was the thought behind Cove. "It's like going into a coffee shop in the sense that it's very consumer friendly, but once you actually get in, you know you're not in a coffee shop, you're in a place where people are working," he told me. "Everyone around you is doing something similar from the idea of either reading or writing or working on a computer. Cove really came about from this idea that we can work more distributed."
A coffee shop where you can work? Done. A community workplace with coffee? Boom.
Lesson 2: Successful entrepreneurs adapt.
"Adaption is, I think, the number one thing that's allowed us to sustain ourselves over the past five years," Segal said.
The truth behind Cove is that the company provides more than just a community workspace. As more people became fans of the concept, companies – some big companies – reached out to Segal and asked if he'd be interested in designing custom workspaces specifically for them. This wasn't part of the original game plan. But Segal has small children and a mortgage. He and his partners realized that this additional service could be a profit generator. So they adapted.
"Concept wise, it's still the same idea," he said. "If you think about it, people are living in the neighborhood and then working out of Coves, but they actually work for other organizations. So it has naturally led to conversations with companies saying, ‘Hey, can you build us an office of our own literally?’"
Things change. People learn. More opportunities arise from existing models. To be successful, an entrepreneur should feel flexible enough to pivot, add services, and capitalize on new ideas. In the end, it's about growing a company, profiting, and building a sustainable organization. The idea gives you the start. But the map may be rewritten.
Lesson 3: Growing businesses need partners. Period.
Segal started his business with his friend from graduate school. But just being friends wasn't enough. Segal’s friend, Jeremy Scott, had a unique value to provide to the company: technology. Scott, a software developer, took over as Cove's chief technology officer and created the platform that runs Cove's locations and overall business. Scott oversees the products and licensing deals with larger customers. Segal, meanwhile, focuses on business development, investor relations, and marketing. Together they've raised money from outside investors who not only provided the capital but connections and experience to help the young entrepreneurs navigate the typical challenges of business ownership.
"The best thing I can do is listen as best I can from our existing team, listen to what the market is saying, but then hopefully distill it in the right way that it puts us on the right trajectory," Segal said.
Segal is doing what I'm not. I have no partners or investors. My business is doing well. But Segal has loftier goals than me and to reach those goals he's been smart enough to realize that he won't be able to do that on his own.
Lesson 4: When you’re competing for talent, the best employees are drawn to a company's culture.
Hiring and retaining talent remains a challenge for businesses of all sizes in 2019. According to the Q2 MetLife & U.S. Chamber of Commerce Small Business Index, millennial and Gen X-owned small businesses are driving the hiring plans of small businesses. Overall, 28% of small businesses plan to increase staff in the next year, whereas 39% of millennial or Gen-X-owned businesses have plans to increase headcount in the next year.
And there may be good reason for that: millennial-owned businesses are approaching the talent challenge differently. As a millennial himself, Segal understands that a company’s culture and workplace perks are key drivers in attracting and keeping talent.
Yes, Cove offers competitive compensation and a great paid time off plan (although Segal admits that their "unlimited" plan has, in the past, resulted in employees actually taking less time off, which is not a good thing!), but Cove still struggles from the same challenges many businesses are facing in 2019: finding and keeping good people. The good news for them is that they've managed to build a great organization. How? By focusing more on culture rather than just compensation as well as leveraging technology to build a distributed network of great people from all over the world.
"Thanks to technology, there's better opportunity to align with people that align with us," he says. "Our structure is aligned with trying to match what people value and align that component from a compensation perspective of these other things with how people personally approach their day job.”
Cove puts few requirements on working "in the office" (they are, after all, offering a service that encourages working out of the office, right?). Instead, employees are told to blend their PTO along with work-from-home options to create the most flexible, balanced lifestyle possible. And it works. Segal says his employees enjoy the opportunity to work a day from home, then in the office and mix in some time off, as long as the work gets done.
"I think it's totally around alignment of culture with the organization, alignment of other people within the organization, and the mission you're doing," he says. "Yes, compensation is important from a monetary standpoint, but I think that takes a backseat to the flexibility."
Lesson 5: Even great entrepreneurs can make questionable TV choices.
When Segal isn’t in the office, he enjoys spending his off time with his family, working out, or watching TV. He told me he's currently watching Undercover, a Belgian detective drama on Netflix. I tried watching it. Let's just say he's better off taking a nap, okay? Or at least revisiting Breaking Bad?
So Segal doesn't necessarily have the best taste in TV. But what he does have is the energy, intelligence and attitude to build and grow a business. Those traits are not uncommon in his generation, and I believe not a small reason behind how his generation is contributing to our current economic growth.