Interaction's Thrivalism

Welcome to The Wokeplace with Rupert Dean, Co-Founder and CEO of x+why

December 08, 2021 Interaction Season 2 Episode 3
Welcome to The Wokeplace with Rupert Dean, Co-Founder and CEO of x+why
Interaction's Thrivalism
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Interaction's Thrivalism
Welcome to The Wokeplace with Rupert Dean, Co-Founder and CEO of x+why
Dec 08, 2021 Season 2 Episode 3

Episode Synopsis:  

As the debate around “the Great Resignation” has shown, recent events have caused many people to re-evaluate what it is they want from their job. Mission, ethics, and ESG can now be viewed as contributions to, not enemies of, an organisation’s bottom line.  

 In this episode we explore how co-working spaces serving as a hothouse for a very modern type of business – ethical, diverse, sustainable and profitable. We examine the rise of the purpose-driven business, ask whether people are more effective when bought together by aligned values and discuss why profit shouldn’t be a dirty word.  

Thanks for listening! Check out Interaction's website for more workplace culture content and case studies (or just follow us on LinkedIn and Twitter).

Show Notes Transcript

Episode Synopsis:  

As the debate around “the Great Resignation” has shown, recent events have caused many people to re-evaluate what it is they want from their job. Mission, ethics, and ESG can now be viewed as contributions to, not enemies of, an organisation’s bottom line.  

 In this episode we explore how co-working spaces serving as a hothouse for a very modern type of business – ethical, diverse, sustainable and profitable. We examine the rise of the purpose-driven business, ask whether people are more effective when bought together by aligned values and discuss why profit shouldn’t be a dirty word.  

Thanks for listening! Check out Interaction's website for more workplace culture content and case studies (or just follow us on LinkedIn and Twitter).

Rupert Dean: So landlords are now having to think, right, I need to create tech-forward, more sustainable, more pay-as-you-go, really cool, out-there common amenities. And I also need all of those operators to operate together, whether it's a restaurant, the gym supplier, the flexible workspace provider, the property manager, they all have to work together because we can't all work in verticals. Everyone has to think about the whole tenant journey.


Dieter Wood: Hi, I'm Dieter Wood, Managing Director of Interaction, and this is Thrivalism, our podcast focussed on the art of thriving, flourishing and evolving under any conditions. In this series, we'll examine how to create flourishing businesses, cultures, careers and places. We explore key topics such as workplace design and build, culture and community, sustainability and, of course, the future of work. Join us and our guests as we explore how people and businesses can set themselves up, not just to survive but thrive. 

Today, I'm joined by Rupert Dean, co-founder and CEO of flexible workspace provider X+Why. Rupert started his career as a corporate lawyer before mobilising his own “great resignation” to build a business that provides inspiring and creative workplaces for purpose-led entrepreneurs and businesses. They opened their first office in Whitechapel in 2019. They have continued to expand through the pandemic, achieve B Corp status, and today we're sitting in your newest office, which is getting ready for its opening party tomorrow. Congratulations on your success so far and welcome to Thrivalism.


Rupert Dean: Thanks very much for having me. Yeah, well, we we've got twenty four hours to get there and get everything fitted out before the launch tomorrow, so we'll see.


Dieter Wood: It's looking beautiful. So finishing touches.


Rupert Dean: I would say. I'd say it's the last 5 to 20% or so.


Dieter Wood: So Rupert, briefly, is my introduction. You left the rat race yourself to find your why? I suppose, given the story of your own career. Do you find that echoes that of your members? And do you find yourself kind of talking over that big question moment when you took that step?


Rupert Dean: Yeah. Well, I think there's been quite a lot of change recently or generationally that originally when I left university, I didn't know what I wanted to do. So I obviously decided to go do the thing that was going to make me the most money. That was just a natural choice because I didn't harbour an ambition to become a fighter pilot or have too much altruism in me, so I decided to become a lawyer. But I think that that's now very different in terms of what people and employees are looking for in particular. And I think they now, yes, making money is something that they are attracted to. But I also think that they want to work for businesses today that do good, that have some sort of impact or a positive mission or a positive impact in some way. And I think that's the big difference now. So quite a few of the employers, companies, enterprises, charities that are in X+Why are mission driven and therefore attracting sort of really interesting people. And I think that that is that is a general movement. And I think that that's the general movement that bigger businesses are now having to make as this war on talent becomes very real, right? And it becomes about how we can attract the best people that then makes you ironically do better and create better supply chain and then be more attractive to consumers. And in turn, by doing well, you can do good. At least that's the theory, but I think a lot of people would just take making a bit of money with impact today!


Dieter Wood: You ask your members to take a pledge in terms of an aspiration around their values - how important is it that to your brand? And how important is that to your other members that they know everybody else has taken that pledge and that ecosystem is there?


Rupert Dean: Yeah, I think it's the first step to building a community so people realise when they come in by signing a pledge, which, by the way, no one has not signed yet, that it essentially says that you will consider people and planet, as well as profit, which is a paraphrase of it. It's not that complicated, but that's what it is. I think that it just makes people aware that beyond the sustainable, green, innovative environment that they're in they're with like-minded people, that they're surrounded by impact-driven or purpose-driven or values-driven companies. And therefore, from the moment they walk in to the coffee, they get to the chair, there is a common theme. There is a common thread. And then on top of that, you layer on some of the other things, like the events and the socials and all of that. Then people can start to realise that they're part of something that's a little bit different and that's really what it's all about.


Dieter Wood: Yeah, that's a step away, isn't it from other businesses in your sector who are sector-driven aren't there and they are around a particular environment or tech or something like that? Do you think that's the way forward? Do you think you're going to get more like-mindedness by that way? 


Rupert Dean: That is what our brand is all about. It's about building those communities within green, innovative environments. So I think first of all, we have to walk the walk. Know we have to do what we're saying, which is a constant bridge that we're always trying to cover and something else we realise we're not perfect. You know, we're on a very clear mission. I think it is a differentiator for sure. I think like everything else, it's about layers, right? And it's about actual authenticity. So I think that people need to know that they're coming to you as a destination for, yes, amazing design, really good quality office space. But all those other things as well, the ESG values that are being surrounded by interesting people so that it becomes less about the price per desk, it becomes less about the fact that they leave because you're £50 more expensive. They don't want to leave because they're surrounded within an amazing physical environment, but surrounded by a really amazing community. And I think that that is a real distinguishing where people want to feel like they're part of something they want to feel like they're part of an address. We don't ever say you're at an X+Why. Every building is branded its own building, so we don't shove it in people's faces. And frankly, we don't say you have to be a soapbox preacher at all, and you can get involved as much or as little as you want. But I think that it's a bit like Starbucks. When it started, people really like the layers of it, the stories behind the coffee, the stories behind the supply chain, the stories behind the staffing, you know, and it just became somewhere that people went as a third place over and above any other coffee place. It's not dissimilar to that. You need layers, you need content, you need interesting stories, but you also need to be really authentic


Dieter Wood: Is it achievable that by being part of an X+Why space that will improve naturally your members ability to attract talent, particularly the kind of younger recruits, if you like? And will it give them an edge because they know that they're part of that ecosystem? 


Rupert Dean: So I think when you know it works right is when people put the fact that they're at X+Why on the front of their pitch deck rather than talking about corporate social responsibility. The back of their pitch deck, you know, something they feel they a box that needs ticking, but actually nowadays in order to succeed, whether you're a B2B or a B2C business, you need to consider your values, needs to consider your supply chains and you consider your environmental, social and governance approaches. And ideally, we would love it if the fact that you were in an X+Why was an amazing kite mark that you could put, you could put in your pitch deck and people would say, Yes, okay, I know what that means. I know that that means that they take their environmental credentials seriously, that they're on some sort of mission to shift mindsets or to change their business behaviours, or that they've already reached some sort of level of responsibility, like B Corp like you mentioned at the beginning. So yes, I think we'd love it to be a distinction in the market as somewhere that is a climate for responsibility.


Dieter Wood: Now, I suppose the pandemic has given a lot of challenges to a lot of businesses in your sector. I was thinking about your brand and I was thinking, I wonder if in a way, the pandemic actually created a massive opportunity for you guys? The great resignation, this phrase that's getting bandied about. Do you feel that you're surfing that wave? 


Rupert Dean: I don't want to sound like Boris Johnson, but we’re very cautiously optimistic. I think you never know what's going to come around the corner. I think that's been the greatest wave of all of this. What was a growing trend towards, you know, the benefits of flexibility and particularly within an inspiring office space has now exploded, right? Because what used to stop people from doing that is they used to think the lease, the traditional lease was the way to go into an office because that sort of was a measure of success. No one ever actually asked the question of what the office was for, right? We've realised that with the benefits of technology, we can all sit at home and work. At our kitchen tables, in our bedrooms, wherever. We've worked out, how to blur our backgrounds on Teams and Zoom so that you can do all of these things from the benefit of your bedroom or wherever. So now all of a sudden, everybody, every business is asking, What are we using the office for? And that was never a sort of macro question that everyone had. But what they've quickly realised is, Oh, we never quite know when the next issue is going to come around the corner, right? What if it's not coronavirus? Is it going to be some other health pandemic? Is it going to be an environmental catastrophe? A plague of locusts? But what we know is that we need to we need to get out of long term liability.


We need to get the 15 to 20 percent of cost on our P&L off, and we need to be able to mitigate that risk. And I think then they've started to realise, OK, well, what is the office for? It's for a place to go, to have fun, to meet, to mentor, for hospitality. And I think then the office is really now becoming about a shop window into the brand of that business. It's got to be a destination for an intention. And that's the big move that's being made now. So people are much more into flexibility. They think much more about technology, sustainability, all of these things and community and making sure that actually it's a real attraction for their staff.


Dieter Wood: I think you saw that pendulum swing. I think three months after lockdown, the office probably was a bit dead. People were like, No, we don't need it. It's swung and it swung, and you can feel it swinging back more and more. And we're seeing that in the market all over the place. And I wonder, what do you think is the thing that when you look back, everybody's going to got the most wrong during the pandemic around offices? And the thing that's going to be proved in a year's time or two years time, it's going to be like, OK, this is where it's all going to shift to.


Rupert Dean: I think those that say that the office is dead are probably wrong, I mean, obviously, I'm biased, right? But I think that those that say you have to come to the office to work are also wrong. I think that actually we don't promote it as a place to get to a desk. So I think what's interesting is those that employ a fully remote-only culture and office environment will really struggle. Not because there's a lack of productivity, but I think that people, particularly people who are young, need to come and they need to feel it. They need to be taught, they need to be around interesting community. And I think that's why you can't just ask people to sit at home and do it without any escape. You know, I just think there's a big mental health or wellbeing issue that's associated with that. And if nothing else, if the office does nothing else as an environment, to be able to build a community that supports your own mental health is a really important thing. So I think those that go fully remote or those that say that everyone is going to go fully remote are probably wrong. I think that's the thing that's going to be the most wrong. And then I think those that employ a hybrid style of work. I think it's going to be more difficult than people think because I think it's easier to go fully remote or to go in the office full time to actually build culture and actually maintain, particularly for medium to large businesses to actually maintain the hybrid style work is actually a really difficult thing for all of those culture and HR to arrange. And then I think those that see the office as purely a place to sit at a desk will also be wrong.


Dieter Wood: Do you expect we're talking about the need to kind of people come together? Do you expect in terms of your members that we'll be looking at bigger businesses growing in a single location? Or do you think it's going to be more about having that brand spread across towns and cities? And you imagine a business is really in multiple locations within X+Why and floating between them?


Rupert Dean: It's really interesting question. I flip flop a lot on that. I've it's the one that people disagree with me the most on, and I'm starting to sort of change my opinion on it, which I did think that there would be this big kind of hub-and-spoke play where people would have a central office, where they would, you know, that would be their central hub, where people would come in for meetings or in hospitality or fun or entertainment or an event. And then they would have some sort of arrangement with your local co-working space or some sort of local place to do work that would provide you with internet accessibility, community well-being, all of that sort of stuff. But again, like I was saying earlier with the hybrid nature of work, I think that's really difficult to actually employ properly and sustainably. And so I wonder whether that will happen. I wonder whether actually people will be told to come into the office a little bit more and actually they'll be less being at home. I hope I'm I sort of hope I'm wrong, but I kind of I feel like that's the way already. I'm starting to see that people are just saying, right, well, we can't house different teams in different areas because people come in from different areas.

So we need one hub. So that hub might as well be in a place that is where people come in on trains or transport hubs or whatever. It's what gateway cities are built for. It's why they're there, and remote places are much harder to get teams to, so it's less likely. What I think might happen is where you have entire big teams, they might take them out of traditionally expensive areas, say London, and they might put them into secondary hubs. You know, other cities around the UK, sales teams, tech teams, call centres, those sorts of things. But I think that they'll still have hubs in primary cities and gateway cities. And therefore, I don't think this big move, this big mass move into the regions outside of those call gateway cities is necessarily going to be as big. That's just my thought is not going to be as big a move as everyone kind of originally thought.


Dieter Wood: Yeah, because you feel that in a way, if we if an employer has a responsibility to provide a decent place for someone to work where they can get away from the kids and the parcels arriving and all the disruptions of being at home, surely there's a rush towards somebody having that membership connection, which allows you access to as many places as again, as a matter where you live, you can go and walk into, you know, we're in a relatively suburban location here. That's a change from some of your other locations. You know, that's where you can walk to it. It's a local hub. 

Rupert Dean: I just wonder whether there's a lot of new technology out there that basically a lot of new platforms that do try and do all of this stuff around, providing you with a certain subsidy to be able to access multiple spaces. And that's not just co-working spaces, by the way. That can be hotels, it can even be pubs. It can be any sort of space where people can seem to be able to put your laptop up and be able to do work. I think there's a lot of that. I think it's useful if it's subsidised by employers to be able to make that fully sustainable because I think otherwise people already have. They feel like they probably have enough outlay like my gym membership and various other bits and pieces. And so I do I I think I just don't know how sustainable that theory is versus it's actually just much easier for me to get in my car, go to the train station, go in orbit. It's a pain and go into the office because I know that that's where I can have a meeting, do some work and I can I can do all those things. I'd rather do that than potentially go into somewhere, pay for it, and it's still just a restaurant or a pub. So I don't know. I don't know. You're right. We are sitting in Chiswick at the moment. That is a relatively suburban place. I hope that it is people who are working at home who aren't going to get on the tube at Chiswick Park and go into town, that they would much rather come here. But again, what are they coming for? You know, they're coming for fun, they're coming for community, they're coming for all of these things, not necessarily to lift up their laptop and open and well they might do that for an hour. But what are they doing? They can do that at home. So I kind of feel like they're going to come here to meet interesting people, to come to events, to enjoy socials, to do all of those sorts of things. I also just think the easiest thing is to go back to so many employers. I think they can't say it, but they just want to say is, I want everybody back into the office. They can say everything else, they can say we're going remote only we're going hybrid or they can be quiet, but they can't say, I want everyone into the office. But eventually, you know, I'm really sceptical. I think loads of them want to say that. I think loads of them will end up over time, start to draught people back and it will become less of a taboo.


Dieter Wood: It does feel like the relationship between employers and employees has shifted. The power has shifted slightly. And how long will that last? What is true, I think, is the expectations of the office by employees has massively shifted, and so the expectation has risen and that pressure is on landlords, isn't it? And you guys as operators. And at the moment, I suppose the landlords are relying on the operators to elevate their proposition. How do you see that relationship evolving between the operators and the landlords?


Rupert Dean: Yeah, so as one landlord said, the imperialism of the landlord, the imperialism of the landlord is no longer what it was. The landlords today are finding that they're in a bit of a race towards actually creating the most attractive space that they can in order to be able to get the businesses that they originally were quite easy to obtain. So the way the attraction, the common amenity space, all of the offering that you give to tenants in your building now needs full review. So you now have to think about the journey. You have to think about the food and beverage offering. You have to think about the wellbeing offering. You have to think about pay-as-you-go, flexible amenity.  You have to think about where people go, when they're when they want to focus, escape, you know, co-work, brainstorm, convene, do events, whatever. These were traditional areas that landlords would say would be in your tenant demise. So you create those spaces. And now the tenants are saying, No, no, no, no, you guys, as landlords have to do that for us and we want to use it on a pay as you go basis, which is slightly sort of changing the whole model a little bit.


So landlords now having to think, right, well, I need to create tech-forward, more sustainable, more pay-as-you-go really cool, common amenities. And I also need all of those operators to operate together. So whether it's a restaurant, the gym supplier, the flexible workspace provider, the property manager, they all have to work together because we can't all work in verticals. Everyone has to think about the whole tenant journey. That is changing what it looks like for us, because it means that we can come in on more kind of equitable terms, let's say, with landlords to generally to work with them in terms of their vision and work with other operators and providers in that building to be able to optimise tenant experience. That is the best way that people are going to be able to improve the attraction to traditional tenants, those that want more flexibility, let's call it lease prices and distinguish themselves today from everything else.


Dieter Wood: It's absolutely clear with Flex Operator /  co-working, it's gone from being a tenant to a value add for a landlord. There's no doubt about it, and actually it's almost the competition is slightly turned around who's going to provide that service, I suppose? What is it that the landlords are in your mind? What's the wins for them in terms of partnering with a business like yours?


Rupert Dean: What used to happen is used to get a co-working tenant not by design, but just because there were quite a few of them that would come in. They would pay a traditional lease or rent, and they would shut their doors to the rest of the building, right? So they wouldn't care about the rest of the tenancy. They wouldn't care about the well-being offering. They would just care about filling and selling desks and the closed door policy that they have, that everyone enjoys what they have inside. And now landlords are saying, Well, how do we create that flex piece as an overall amenity and selling point for the rest of our tenants on traditional leases? So, so many say professional services or medium to large traditional tenants now come in, and the first question they ask the landlord is Who is your Flex operator? Because we don't want to necessarily take as much space as we traditionally would have. So we want to be able to access, say, meeting rooms or event space or overflow space for work on an as needed basis. So I think that's the massive thing. It's sort of, as you say, it's shifted it so that it becomes not closed, not vertical, it much more open, much more horizontal in terms of the rest of the offering in the building. Other cool things are what is your sustainability policy today as a landlord? Landlords are just having to think about how they're kind of traditional base build can support, you know, measuring, capturing, benchmarking and improving their energy use, their carbon footprint and actually being able to communicate it with their tenants and being able to say, by the way, this is how we're improving it because everyone knows that they have an obligation today with B Corp and with net zero to be able to get to that, to be able to improve and to be able to say it and to be able to do their own impact assessment and be able to tell their tenants about it and their customers about it. So I think that's big and obviously then technology comes into it to be able to make sure that all of those things work. Whether you're a flex tenant, whether you're just there to use the gym, whether you're just there to have a meal or whether you're there to do all of those things.


Dieter Wood: We've got landlords, retail landlords entering this market pretty aggressively because they've got a lot of space they need to deal with. How is that in your mind going to shift the dynamics of the sector? 


Rupert Dean:  I think that's really interesting. I think that will play really well, that some of that retail stuff will play really well into how people want to work today because I think what people want is they want a place not just to work, but to go and work out, to go and have fun, to go and meet friends, to have leisure and whatever. That's why we ended up looking at quite a lot about going into sort of retail spaces because under one roof, you can do all of those things. You can come into work, you can go to the cinema, you can go to the bar, you can go and have a choice of lunch. You can do that. The ease of which you can live your life is so good compared to being stuck in a big kind of commercial space. There are loads of problems with it. There's loads of issues, particularly around light, right? So you know, this might say you go into an old Debenhams or John Lewis or any of these other big kind of boxes. And they're very deep, very deep floor plans, and they traditionally haven't relied on light. In fact, they've been completely the opposite. They've actually preferred the dark to be able to use their own lighting to be able to enhance colour. And so that has meant that natural light has been not wanted and therefore that creates all sorts of problems. I also think that people have just thought, particularly with smaller units, they thought I will just bung in a co-working operator into that space. I think it needs a lot more kind of holistic vision in terms of how that product, that coworking service, flexible work product works with everything else because I think it has to work with everything else. It has to be a bigger, wider vision on what you're trying to achieve. And I think those that get that right will actually do something really interesting. But if it's not co-working, they'll do something else that's really cool. 


Dieter Wood: It’s a fascinating sector right now, without a doubt, isn't it? I mean, the pandemic has accelerated everything that was already going on, and without doubt, it's a kind of really interesting place to keep watching. So we'll continue to do that. Good luck for your opening tomorrow. Very, very exciting. Probably got a bit of work to do to go in. It's all ready to go, but thank you for your time.


Rupert Dean: Thanks so much for having me. I've got to put on my coat and go and do some work.