Invested in Our New Reality Season 14 – Downtown: Evolved.
Episode 6: Invested in Helping Start-Ups Get Started – with Eric McRae
In this episode of the Invested in Our New Reality, host Sam Laprade chats with Eric McRae, Founder and CEO of MBO Coworking, who shares what it’s like to launch a business in the ByWard Market in 2015 and then, just five years later, face a national work-from-home order and rapidly changing market demands.
Below, you’ll get a full guide to Episode 6 of Season 14: Downtown: Evolved, including a full transcript and a snapshot of the themes covered in the conversation led by our Season 14 guest host Sam Laprade.
Listen to the episode on Spotify, Apple Podcast, Simplecast
About the podcast:
Invested in Our New Reality is a dynamic podcast where business leaders offer honest observations about navigating our ever-evolving reality. Each episode provides a space for entrepreneurs to speak candidly about the challenges and opportunities they’ve faced, arming listeners with practical advice on how to thrive in the future.
Season 14 – Downtown: Evolved
Ottawa is a globally recognized, innovative, and future-ready city and the best place to learn, work, live, and play.
A vibrant city can provide access to a diverse and highly educated pool of tech talent, world-class R&D, low business costs, innovation ecosystems, larger markets, and an exceptional quality of life, all of which significantly impact the success and growth of loyal entrepreneurs and companies.
Season 14 of Invested in Our New Reality, Downtown: Evolved, celebrates the companies that make their home in Ottawa’s downtown and those working to transform and revive the city’s centre.
Episode Highlights:
- 1:18 – The reason Eric started MBO Coworking.
- 2:06 – The importance of creating a community
- 3:08 – The impact of the COVID-19 pandemic and the uncertainty surrounding the rapid changes
- 4:32 – Support and guidance for moving forward from Invest Ottawa.
- 5:49 – The shift to remove work and the resulting impact on MBO Coworking.
- 7:56 – What cities are getting it right when it comes to their downtown core?
- 10:52 – What are fellow business owners saying about the support they need to be a successful business in the downtown core?
- 12:11 – Advice and words of encouragement for aspiring young Black entrepreneurs.
- 13:12 – Eric’s favourite part of being a business owner in Ottawa’s downtown core?
Listen to the episode on Spotify, Apple Podcast, Simplecast
Full Episode Transcript
Host, Sam Laprade: Hi, I’m Sam Laprade and I’m so glad you’re joining us for Invested in Our New Reality – Invest Ottawa’s podcast for business leaders and entrepreneurs.
Cities have seen a lot of change in the past five years and Ottawa is certainly no different. That’s why the 14th season of this podcast is called Downtown: Evolved because we’re looking at the evolution of Ottawa’s downtown core. We’re chatting with leaders that call the downtown their home base, as well as the people helping to transform and revive the city centre – a network of engaged stakeholders, helping Ottawa maintain and grow its reputation as a vibrant, exciting place to live, work, play and visit.
Today, I’m delighted to welcome Eric McRae to the podcast. Eric is the founder of MBO Coworking, which is a co-working space in Ottawa’s ByWard Market, targeted its small businesses and startups that need a place to go to get work done in a comfortable, stylish professional work environment. Eric, it is great to have you here and welcome to the podcast.
Guest – Eric McRae: Thank you, Sam. It’s a pleasure being here as well.
Sam: Well, I got to tell you, I’ve heard about MOBO coworking. I have actually been at your incredible business. Why did you start this business?
Eric: Probably for two reasons. I did it for myself: when I was an entrepreneur moving around, travelling through different cities, I noticed like San Francisco, New York, Las Vegas, and through Toronto they had lots of resources and co-working spaces – communities set up for entrepreneurs. And the type of community that I wanted to find for myself, which was one for creative entrepreneurs and professionals. And I didn’t find that within the Ottawa market, so I opted to use that opportunity to build out a co-working space. And really it’s around setting up community spaces and resources for entrepreneurs to be successful.
Sam: Yeah, it’s wonderful. And I love the fact that you said create community. How important was that aspect? Cause I think it’s one thing Eric, to create a space, you can put all of the desks you want in there, all the comfy couches, but that creating community is really at another level.
Eric: Yeah, community is a different kind of, element because that’s really unique to the individual businesses that attend. So, when you look at coworking spaces, and I’ve been to quite a number of them, each of them have largely a different vibe, depending on the people that have collected there.
And to be able to create a community means that you have to have an intention around what it is that you’re trying to do and how you want to work with others. And for myself, I wanted to work with people that were creative, resourceful, weren’t necessarily taking themselves too seriously, and they had a number of years of experience behind them, but they were also professionals and really confident in what they did on a daily basis and they were best in the market for what they do.
Sam: I love it. And you started the company in 2015, things were flying along as we all know, until almost everything came to a pandemic-induced stop in 2020 and office spaces emptied out, with most people opting to work from home. How did this impact MBO Coworking?
Eric: Yeah, that was an overnight change. When the pandemic hit the impact to the business was, to say the least, significant. You know, I saw almost an immediate 70% drop in revenue. And you weren’t quite sure as to what was going to be happening in the market because there were so so many unknowns. People were talking about vaccines. People were talking about return to work – and all these different strategies. But for entrepreneurs and people in my position and I spoke with many of the other coworking operators over that period. And it was just a large amount of uncertainty.
So, the only thing that we could do at that point is a) try to maintain our sense of community and groups, stay in contact with our clients. And most of us scaled down our operations just as an impact of financials.
You know, like holding real estate and, you know, real estate in the downtown, or really anywhere in Ottawa, it’s quite expensive. So, we had to drop a lot of the costs that we had just to maintain operations for those services when we returned.
Sam: Wow, even hearing you talk about that time it’s still heartbreaking to remember that time in our lives.
You turn to Invest Ottawa and Invest Ottawa really stepped up during this time as we know, and you know you reached out to them trying to figure out how to keep your company viable through the pandemic.
What kind of advice were you seeking and really how did Invest Ottawa help you move forward?
Eric: So, for myself, I think what I was looking to do is figure out how I can actually pivot and shift my business. We were chatting earlier about the community part of the business and a big part of that for me was actually the coaching and mentoring other entrepreneurs and helping them through their journey and through their path.
Invest Ottawa helped me kind of maintain those connections and relationships with individuals. And also introduced me to a lot of new entrepreneurs that I hadn’t been connected with before.
And then there was also the advice and counsel side, where I needed to understand what were the best strategies that I could take to maintain the business in the long term. And having some counsel from a financial perspective was probably the most relevant. And also the marketing because during the pandemic I also opted to rebrand my business. So, I had a lot of support from that side as well.
Sam: Oh, fascinating. One of the things that really changed because of the pandemic is the idea of how and where we work. People are now much more comfortable working from home or remote locations. Talk to us a little bit about how that’s affected your business plan for MBO Coworking.
Eric: So from my perspective, it still was a significant impact, right? Like I’d mentioned, I’d had to close down the number of my locations prior to the pandemic. I had four locations at about 25,000 square feet and now I’m down to about 2500 square feet. And as a result of just people working from home, folks just not feeling comfortable returning to the office in the space and as a result, their demand for that space reduced. So, I had to reduce the operating cost and footprint of the business overall.
Sam: As societies continue to adapt and redefine the future of work. How is MBO Coworking? Going to evolve as well?
Eric: So, the next evolution point for myself and for MBO Coworking is actually working with entrepreneurs to help them establish their businesses in a scale format.
So many of the things that I looked at when having conversations with people at Invest Ottawa, other groups, other community and entrepreneurial groups in the city, was that there was a bit of a gap in terms of the support that entrepreneurs get when starting their businesses. They have most of the incubators and resources, provide training and resources, but not necessarily the coaching guidance at the depths that people need to actually develop and build their business within the first, you know day zero to day, you know, year five.
So, that’s the next evolution for myself with MBO Coworking. Myself and two other partners, we have founded a new business called Founders Coach, and that’s really intended and driven at setting up an incubator for entrepreneurs that will help them with the entire spectrum of what they need to do to launch their business successfully.
Sam: That’s amazing. Good for you. I mean, you’re you’re obviously tapping into your skills as well. And you talk a lot about traveling to other regions to work with clients. What other global cities are getting it right when it comes to building that vibrant downtown core and how can we learn here in Ottawa from them?
Eric: Yeah. What I think of the downtown cores, you know, there has been a whole lot of travels for myself in the last few years. But talking to other people in different cities and across the US and Canada, I think Toronto certainly has a great stand in terms of how they’re developing their community. They invest lots of money in terms of their entrepreneurship, events and networking.
I was at a conference two weeks ago for Black founder entrepreneurs and we had probably about 250 people turned out and it was all around talking about financing strategies, how to build your business and how to support it. And I think when you look at cities like Toronto, as I use that as an example, they really continue to get out there and engage with their communities and Ottawa largely being a government town, most folks aren’t necessarily entrepreneurs.
So, the density and the number of people that we have within our communities is a bit smaller and that can be an advantage because it’s actually easier to connect with those individuals. And it’s important for all the coworking spaces and all the incubators and places like Invest Ottawa to kind of continue to support those communities and drive change and innovation within our industries.
Sam: Yeah, yeah, really interesting. I mean, the vibe of MBO, I mean, like I mentioned, I’ve been there before, talk to me a little bit about why, you know, that that interior is so important to to the vibe of what you’ve created there.
Eric: So, one of the things that I would identify that always gives me a lot of pride when I hear it, clients come in and first or second time they come in, they always say I’ve been more productive here than I have been at any other space before.
Sam: Yeah.
Eric: And for me, that’s the biggest win. And that was not by accident. It was very intentional and it was part of my design. I wanted to set up small spaces that didn’t necessarily house a hundred, 150 people. They had to be able to seat no more than 30. So all of my spaces tended to be a bit more intimate. As a result of that, people within the space had a very clean and clear sense of community and what they did and who they were. And I remembered when I first started, probably within my first year or so, one of my clients asked me, she said, “Hey, why don’t we have casual Fridays and have a beer? And do ping pong so we can meet everybody and we can talk to everyone?” And I asked her and I said, “Who in this space do you not know?” And she looked around and she’s like, “Yeah, I know everybody.”
And that was the intent. Was to get a place that was intimate enough that people could still connect as a community.
Sam: Oh, that’s great. That’s awesome. The ByWard Market, one of my favourite places in the city, you know, you’re part of that dynamic community. What are your fellow business owners saying right now about the kind of support they need to ensure that they continue to run a successful business in that area?
Eric: One of the principal things is being able to adjust to the current economic and social environment. The ByWard Market is, the volume of people, normally we had something like 20,000 people a day coming into the ByWard Market and it is at this point it’s probably half of that. So, everyone has had to make adjustments in terms of how they operate, their pricing, their marketing, who they connect with instead of relying on tourists, they rely on locals. And the restaurants etc., the volume is just not as high, so they just do other things to cut their cost, to maintain viability. And that’s been a real struggle for all of the entrepreneurs.
Everyone’s kind of working with the same equation of, “What do I do with 40% less revenue? And still be profitable and still sustain my business? So, that as we come out, further out of the pandemic, we have an opportunity to maintain and grow the business in the future.
Sam: Yeah, so important. What would you say, what advice would you give for, you know, maybe a young Black leader that wants to step up and start a business in the economy we just talked about?
Eric: Oh, I’d absolutely say do it. Because when you’re in this kind of economy, you already have a series of known elements that you can adapt and adjust to. So unlike when I started MBO Coworking, as you mentioned back in 2015, the pandemic and this environment this scenario didn’t exist. So even starting a business now, you are allowed to be able to factor that in. And there are tons of resources, the government has provided grants and programs like BASEs [Business Accelerator or Support for Entrepreneur programs]. You have the Black entrepreneurs innovation hubs, you have places at Carleton and Ottawa University. All these resources are around you to be able to support them. And because the world has largely gone virtual in Zoom, it’s much, much easier to actually connect and develop relationships with other people that you need to help you support and start your business.
Sam: As we end our conversation, it’s gone by so fast, but I want to know, Eric, what your favourite thing about running a business in Ottawa’s downtown core is? What sort of gets you up in the morning?
Eric: Oh, the people. I absolutely love working with people that I have in my business. As I had mentioned at the top of the interview, the people that come into my business are creative entrepreneurs, so they’re very like-minded folks like myself. They love community, they love new ideas, they love experimenting. And for me, getting up every morning. I don’t think in the last 10 years, I’ve never hesitated getting up and getting into the office. It’s always been a pleasure because the people that I work with and my clients are amazing.
Sam: Eric, thanks so much for this conversation today. It’s been such a pleasure to chat with you and learn more about MBO Coworking. Thanks for taking the time.
Eric: Sam, thank you very much and thanks for Invest Ottawa for supporting us over all these years and look forward to new, brighter, better days in the future.
Sam: Beautifully said. And thank you so much to all of our listeners. Until next time, I’m Sam Laprade.
Thanks for listening to this episode of Invested in Our New Reality. We’re committed to bringing you dynamic conversations with business leaders who are transforming and reviving the National Capital Region. So, stay tuned to our next conversation about Downtown: Evolved. And be sure to reach out to us at investottawa.ca with your thoughts and comments. We’d love to hear from you.
Until next time. I’m Sam Laprade and I’ll chat with you again soon.
