The Entrepreneur: Charles Armstrong, The Trampery
A pioneer of creative workspaces, venues and, more recently, housing, Armstrong offers a snapshot into how he's built a £2m social enterprise
Founder: Charles Armstrong
Company: The Trampery
Description in one line: Creative workspaces, housing and neighbourhoods with social impact.
Previous companies: Trampoline Systems
12 month target: £3m
Describe your business model and what makes your business unique:
- We offer desks, studios and other facilities to growth businesses. We also offer specialist support programmes. We have the strongest, liveliest member communities.
- We are structured as a social enterprise. Part of our mission is to support entrepreneurs from under-represented communities.
- We pioneered the “innovation neighbourhood” concept providing housing, workspace and supporting facilities.
What is your greatest business achievement to date?
I’m very proud that The Trampery, as a social enterprise, consistently delivers a higher quality of workspace experience than most of our heavily-funded commercial competitors.
What numbers do you look at every day in your business?
Occupancy is the crucial number. Currently we’re at 96% across the portfolio of sites, which is a testament to the amazing service members receive from our team.
To what extent does your business trade internationally and what are your plans?
In 2015 we started our first international project when we were engaged by the City of Oslo to develop an innovation neighbourhood in the east side of the city. This is now up and running as Tøyen Startup Village and is having a great impact in the Nordic innovation ecosystem.
We’ve also delivered initiatives with a variety of international partners including Expedia, Dubai Silicon Oasis and the Swiss government. More international sites are in the pipeline. Each one will be different and magical in its own way. The Trampery is never going to turn into a faceless identikit chain, that’s not what our members are looking for.
Describe your growth funding path:
The Trampery is a social enterprise so our funding hasn’t followed the typical equity finance path. The initial seed funding of £70,000 was provided by Circus Foundation, a social incubator. After that the first stage of growth was bootstrapped, entirely financed from earned income.
I always recommend this to other entrepreneurs as it forces you to deliver a service your market wants and is ready to pay for. We only started raising capital once we started to develop larger sites.
The £1.5m investment in our flagship site on Old Street in London was financed through a combination of a corporate partnership with advertising giant Publicis and a debt facility from NatWest, supported by an Enterprise Finance Guarantee from the UK Government.
Most recently, the “Fish Island Village” innovation neighbourhood we’re developing with Peabody in London’s Hackney Wick area required a £7.5m investment. This is covered through a combination including a grant from the European Regional Development Fund and a debt facility from a social investment fund.
What technology has made the biggest difference to your business?
Two technologies which have made a big difference in The Trampery are Podio and Slack. We started transitioning operational workflow onto Podio in 2014. At this point almost every aspect of the business runs on it. It’s helped us streamline how we work and prevent things falling into cracks. Meanwhile Slack has been a big help supporting team collaboration across multiple sites. It does one thing but it does it very well. We’ve since introduced it for members too.
Where would you like your business to be in three years?
Three years from now The Trampery will have two or three more large-scale innovation neighbourhoods in development, with at least one of them outside the UK. Our business support offering in fashion, travel tech and digital arts will have been extended to a couple of new sectors. We will also have several sites up and running in deprived neighbourhoods, advancing our mission to harness entrepreneurship as a tool to combat poverty.
What is the hardest thing you have ever done in business?
In 2009 I undertook the UK’s first ever equity crowdfunding to raise £500,000 for the data analytics venture Trampoline Systems. Our lawyers told me point blank it was impossible and I’d go to prison. First I had to find a lawyer who was interested in the challenge, and then we spent a month figuring out how we could do it without tripping over any of the financial regulations. In total it took a year to raise the money. The effort was momentous, but there was huge satisfaction when we pulled it off.
What was your biggest business mistake?
When I started Trampoline Systems I focused too much on the long-term opportunities rather than satisfying immediate customer needs. When the 2008 financial crisis hit this almost destroyed the company, since we had no way of sustaining the business from earned income. That was an important lesson to learn.
Piece of Red Tape that hampers growth most:
Here in the UK the planning process is seriously broken. It’s hugely expensive to get schemes through to consent, yet the system fails to deliver the public benefits it’s intended to safeguard. I would single this out as the area most urgently in need of reform.
What is the most common serious mistake you see entrepreneurs make?
Too often I see people putting off hard decisions or ignoring problems and hoping they’ll go away. You have to grasp the nettle, deal with the issue and move on. Unresolved problems have a way of festering and spreading that can end up destroying a fledgling business.
How will your market look in three years?
The commercial property industry is going through a large-scale transformation, driven by rising demands for flexibility and wraparound services. By 2020 co-working will be a commodity. All large commercial developers will have their own co-working brands. At this point it won’t be about start-ups, the focus will be the mid-market.
Meanwhile the way entrepreneurs and creative professionals use property will continue to change, affecting housing as much as workspace. I hope The Trampery will be at the forefront of these changes.
What is the single most important piece of advice you would offer to a less experienced entrepreneur?
Be yourself, never compromise that.
Yachting and snowboarding; two of my favourite escapes.
Executive education or learn it on the job?
I think the most powerful route is learning on the job supported by a mentor. I was hugely fortunate to be mentored by Michael Young (Lord Young of Dartington) when I was starting out as a social entrepreneur.
An MBA might be valuable for someone wanting to rise in a large organisation, but it’s virtually useless for an entrepreneur.
What would make you a better leader?
I would probably be a better leader if I didn’t get so emotionally attached to projects I’m working on.
What one thing do you wish you’d known when you started?
There are many different routes to finance a business, not just the classical venture capital path.
One business app and one personal app you can’t do without:
Business app: Slack. Personal app: Instagram.
Crossing the Chasm by Geoffrey A Moore, publsihed 1991. It’s the one and only business book I recommend to people.