Small business week: Finding space to start

Peter Kovessy
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For co-CEO Aydin Mirzaee, bootstrapping a business meant working in dorms, classrooms – even beside a masseuse.

The team includes co-CEO Aydin Mirzaee, at front. (Photo by Mark Holleron)

Founded in 2008, the company's flagship products are FluidSurveys, an online survey platform, and ReviewRoom, an online tool used by organizations to accept and review applications. The bootstrapped company says it currently has more than 10,000 customers.

But as Mr. Mirzaee tells OBJ, getting there wasn't always easy:

"We basically started out in a McGill University dorm room as my co-founders were still in school. It was crazy. People were coming in and out all the time, and you’d always hear partying in the background. It was kind of fun. It was small, so we’d end up sleeping on the floors.

That’s where we did all of our work for the first year. Then we got some funding from the Ministry of Research and Innovation to work with Algonquin College, which let us work out of their classrooms for a summer. When that ended, we begged them to find us some space because we really couldn’t afford real office space. We didn’t even have our first customer.

They found us a lab without windows. It was almost like a dungeon, but we still really appreciated it, especially since it was more like an office than the college dorm room.

We did that for about eight months. We would have stayed longer, but Algonquin basically kicked us out. It was scary – we weren’t really ready to take on (additional) expenses. I used to work at Nortel Networks, and I had what I thought was enough (money) for eight months or so. Somehow that lasted me close to two years. It was tough.

When we did get our first office, we were looking for the cheapest space we could find. We were just looking for a place where we could go month-to-month. We ended up sharing an office with a masseuse in south Ottawa and were kind of separated by a curtain. We didn’t really have a door. It was better than not having an office, as it meant we were more legitimate. We were going to work (each morning), rather than just waking up in a dorm room. We had a commute. It was more official, but it still had ripped carpets and it wasn’t exactly a place you would take people to show off.

We stayed there for about two years, but we were growing, and things got really crammed.

So we literally got out and started driving. Three blocks later, we saw a sign that read, “Affordable office space.” We said, “That’s exactly what we need.”

We walked in and it looked like a palace compared to where we were. It was official office space in a serious three-storey building. There were other tenants, like doctors. There was also a 1 for 1 Pizza and a Pizza Pizza outside. When we first moved in, we had pizza every day. We were there so much, the pizza guys would send us a pie once a week because we were basically putting their kids through college.

We were looking for a short three-year lease, and we were negotiating with the landlord. He wanted to charge us a certain amount. We offered to pay less (in the first year), pay the amount (he was looking for) in the second year and then pay a little bit of a higher amount in the third year, so it balanced out.

At that point, we were about eight or nine people. Now we are about 35 people in this office and are pretty crammed in. We are in different parts of the building, in separate offices. (But going in), we always figured that if we ran out of space, it would be a good problem to have.

The biggest lesson I’ve learned is that the most important part about office space is the people who fill that space. They create the environment. We’re doing really well as a company, but if you come into our office, it is nothing fancy. There is no glamour. It is office space, and the purpose is to bring us together."



SIDEBAR: Ask the expert

How early do you need to begin looking?

Most new companies of five to 10 people should be actively looking for space from six to nine months in advance of when they’d like to move in. This is to allow time for the business terms to be negotiated, legal documents to be prepared and to make any necessary physical changes to the space before you move in.  


What’s included in the rent?

Gross rent should include the base rent (the money the landlord keeps) and your proportionate share of operating costs, property taxes and utilities for the building.  These three items are generally grouped together and described as “additional rent.” Some buildings charge separately for hydro or extra for after-hours air conditioning.  Some buildings provide in-suite janitorial services and some don’t. Get a breakdown before you sign on the dotted line.


What is the biggest mistake startups make when looking for space?

Committing too fast. The commercial real estate industry in Canada still predominantly uses a binding offer to lease that precedes the much larger commercial lease document. Though intended to save legal bills and get the business terms done faster, many tenants find out too late that they have agreed to some very landlord-friendly legal language in a 60-plus-page document that they haven’t even received when they signed the offer to lease, and become locked in with little leverage to make changes.


What else should new companies consider?

Do more in your space with less real estate. The latest space design trends encourage office users to create reconfigurable areas that serve more than one purpose. For tech startups, the most appealing application would be around shared spaces. Take a lunchroom. This space could be wired for projecting speakers and double as a training area or all-hands meeting room. You can even get walls you can write on using chalk or whiteboards.

If you also include a variety of seating configurations like bar tops,  small round tables or restaurant-like booths, you suddenly find that instead of building a boardroom and a meeting room, you can build a much more vibrant space that actually fits in a smaller total footprint. This saves you money while netting you cooler space.  It’s win-win.


– Darren Fleming is the managing principal at Cresa Ottawa.

Organizations: Algonquin College, McGill University, Ministry of Research and Innovation Nortel Networks Pizza Pizza Darren Fleming

Geographic location: Ottawa, Canada

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Recent comments

  • Jeff Daniels - Royal LePage Commercial
    October 17, 2012 - 08:34

    Remember that all buildings are not created equal. Older buildings have older air handling and mechanical systems. Open concept configurations can create dynamic, cost effective work environments; however, older buildings were not necessarily designed to support high-density configurations. Take note of other tenants in a building, consider how they use their space, and ask for a reference. Most importantly, view a variety of options and learn how to identify potential issues.