A pioneer of coworking preps for a comeback

Over the last decade, Anne Kirby transformed The Candy Factory from an object of curiosity into a beacon of community. This year — the 10th anniversary of the Lancaster coworking space — was poised to be its best yet, she said.

Then, in mid-March, Kirby began the difficult process of winding it down, even before the state began mandating office closures to stem the spread of the coronavirus. 

“You could see the writing on the wall,” said Kirby, who founded The Candy Factory in 2010, long before coworking became a darling of Silicon Valley.

Now, as elected officials unveil general plans for reopening the economy, Kirby is eyeing the specific steps she’ll need to take at The Candy Factory. One thing is clear: It will involve more than simply shaking off the dust.

“We know that we’re going to take at least two weeks or so to get things in order before we start letting members in,” Kirby said. “Obviously, the sooner, the better. But we also want to make sure it’s the right time. We don’t want to open prematurely and then have to close again.”

She’s hoping to reopen sometime next month. “I think it becomes increasingly more challenging if this goes on past May,” she said. 

The Candy Factory, located at 342 N. Queen St., is not her only priority, however. As a leader in the Lancaster small-business community, Kirby has been vocal about the needs of others. 

In late March, she helped co-found an initiative called EnCourage Lancaster. Its goal is to bring attention to the city’s smallest businesses, those that may have been overlooked by federal emergency loan programs such as the Paycheck Protection Program. Its founders include more than a dozen local entrepreneurs and small-business owners.

Surrounding communities are paying attention. People in Lititz and in the river towns of Columbia, Marietta and Wrightsville have reached out to discuss forming chapters, Kirby said. 

Among other initiatives, EnCourage Lancaster has been collecting data on the impact of the pandemic. Of 139 businesses surveyed, 40% said they will run out of cash in a month, while 56% have ceased operations entirely. Many will not come back.

“We know we’re going to lose a percentage of small businesses, and that’s a real shame,” Kirby said. “But if we can wrap any support around them, any help is better than none.”

Help can come in the form of likes on a business’s Facebook page or the purchase of a gift card, Kirby said. EnCourage Lancaster also is raising money via GoFundMe for a grant program. It had raised about $9,000 as of April 19. Debt is not a viable lifeline for low-margin small businesses, especially given the measured pace of any economic reopening, Kirby said. 

The grant program is being rolled into a larger relief program being overseen by a pair of Lancaster-based economic development nonprofits, Assets and Community First Fund. That program — the Lancaster City Small Business Emergency Fund — will be offering $1.25 million in loans and about $200,000 in grants, with the grant money coming from Fulton Bank, the High Foundation and the Ferree Foundation, as well as EnCourage Lancaster. The city of Lancaster chipped in $250,000 to the loan fund.

Smaller businesses, with revenues up to $500,000 will be eligible for both grants and loans. Those between $500,000 and $1 million are eligible for loans only. Applications are expected to open in late April.

The fund may grow to accommodate more businesses, but there are no firm plans as of yet, said Jonathan Coleman, co-executive director of Assets. “There’s an endless amount of need,” he added. “Whatever we aggregate will not be enough to meet all the needs of small businesses, but whatever we can aggregate is better than nothing.”

Because grants and loans can only go so far, EnCourage Lancaster is hoping to spur discussion about other forms of economic relief, such as rent forbearance. Landlords have their own bills to pay, Kirby acknowledged. But, she said: “It has to be a shared sacrifice.”

Even when the economy starts to crank back up, small businesses likely will face constraints, Kirby said. Restaurants, for example, may reopen with fewer tables, and thus lower sales.

The Candy Factory has not been spared those kinds of calculations. 

A large portion of its revenue comes from business and community events held on its sixth-floor and in its conference rooms. That income has dried up and is unlikely to come storming back, Kirby said.

She has applied for a roughly $35,000 Paycheck Protection loan for The Candy Factory’s four-person staff but had not been funded as of April 15. 

Most of the coworking space’s 250-plus members paid their dues for April, but Kirby isn’t expecting them to keep paying if the space stays closed. The landlord is letting her pay April rent in thirds but May is coming due.

Kirby goes in at least once a day to pick up the mail — and absorb the changes that the last month have brought to the space. “There was a lot of energy back there and to see it just dead is a little depressing,” she said.

To stay connected, Candy Factory members “check in” virtually at the beginning and end of each workday, and they hold virtual happy hours on Fridays, Kirby said. “I just cannot wait until I can see all these people in person again.”

In the meantime, Kirby is sketching the changes that will come to the coworking space. Communal tables that had four chairs will probably have two, to ensure greater social distance. The touch-screen kiosk for check-in will be replaced. And new trash cans will have motion sensors.

“There’s a lot of moving pieces that need to be figured out,” Kirby said. And even though revenue will be diminished, she is reluctant to raise rates for members, who pay between $50 and $300 per month, depending on access. Business memberships cost more.

“Because of the uncertainty, it’s very challenging,” Kirby said. But, she added: “I have faith that we’ll get through it.”

— Joel Berg, editor of BizNewsPA

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