tPC Small Business Spotlight: Certain Standard

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In our last Small Business Spotlight, we featured menswear retailer, Division Road.  This time around, we explore the process of bringing a physical product to market with Certain Standard, a  Seattle based company that "believes in a higher standard of goods to equip you for a life less ordinary."  Certain Standard launched this year with a beautiful line of incredibly well-made umbrellas and will be releasing other quality products in the near future.  We caught up with Jason Sullivan, one of three founders, to learn more about the team, the company, and the launch process.

What’s the background of the founding team?

The best way to create something fresh is to come at it with fresh perspective. Well, we have that in spades given that none of us have a fashion pedigree.

Jason (Sullivan) spent 15+ years working at some of the world’s most successful advertising agencies on some of the world’s most famous brands. Most recently, he was Managing Director of Publicis Seattle, one of the industry’s most respected creative agencies.

Price (Eberts) started his career with a business intelligence startup before moving into more traditional management, brand, and technology consulting for big, blue-chip clients. Before Certain Standard, he was the COO of Conenza, a social networking technology company.

Clara (Mulligan) is a creative’s creative who is one of the most talented designers in the world. No joke. She’s owner her own branding firm, tinkered with her own fashion line, and has led the design discipline at some of the best agencies in the industry. She currently lives in London but still considers Seattle home.

 

What’s the mission behind Certain Standard

We don’t really get hung up on mission in the traditional sense, as much as we subscribe to a shared vision to raise the standard of the things we make and the way we behave as a brand. We make beautifully designed and incredibly well-made things that make people feel something. That’s why we’re maniacal on the design details. That’s why we’re sincere about the impact we make, and can make, on the world.

 

I can count the number of times I’ve opened an umbrella.  I’m also probably too old to wear wet clothes to work.  Can you convince Seattle locals to adopt the umbrella? 

We certainly think so. Who’s to say that umbrellas and Gore-Tex can’t coexist? We own ski jackets and rain coats. We also use umbrellas. For us, it’s all about style and making sure you don’t have to compromise it because of a little weather. You want to wear that leather jacket, but it’s raining. Try an umbrella. Don’t feel like wearing a jacket at all. Try an umbrella. Not sure if it’s going to rain and don’t want to carry a jacket? Try an umbrella. Hiking in the Ho rainforest? Even we say go with the rain coat.

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What is the giving program and how was it conceived?

Our giving program is simple. Simple, but focused. We wanted to support a couple organizations who are helping make the world a little brighter. The company you keep speaks volumes and we believe in putting that company out there. Not only that, we wanted to involve consumers by letting them choose which of our two partners their specific purchase supports. Our giving partners are Nest (buildanest.org) and Global Nomads Group (gng.org), two organizations that play in totally different arenas, yet share the goal of making our world a little brighter… better. Check them out when you get a chance.

 

There is something pleasing about watching a company do one thing and do it really well.  What does the future hold for CS?  Keep refining the umbrella offering, or add more products to the mix?

We’re an accessories brand. We’re starting with umbrellas but already have more products in the development pipeline. We’re thinking blankets as the next launch, but we’ll see. The art comes in finding the balance between diverse and fragmented.

 

Especially in Seattle, we hear mostly about people bringing digital products or services (e.g. coworking, restaurants) to market.  What are the unique challenges of bringing a physical consumer product from idea to the shelves?

In general, making physical stuff is hard. It just takes time. Time to find the partners. Time to source the materials. Time to make the parts that are used to make the actual product. Time to prototype. Time to change or even start over. Time to get it all over the world.

 

Our process was far more difficult and took far longer because we were creating something from scratch. We didn’t want an off-the-shelf solution. We wanted to create a new, better designed umbrella using materials and looks that were new to the industry – natural cork handles, powder coated shafts, proprietary tips, custom colors, etc. These things weren’t new to the world, but they were to the industry and that took some time to do and do right without compromise.

 

What’s your retail strategy?  Is the plan to follow in the footsteps of Warby Parker et al to use it as a showroom and marketing strategy, or do you expect to drive significant revenue at retail?

As much as we’d love to replicate the success of Warby Parker or Bonobos, those products are a bit different than ours in that fit is crucial part of the purchase. That said, we do subscribe to the showroom vs. traditional retail environment… at least for our branded store. We want it to be a place for people to interact with the brand vs. come to shop. Hang out talk a bit; and if you happen to buy something, then great.

 

As for strategy, we’ll continue to sell direct via our online storefront, and will be in other retailers soon – boutiques, department stores, and even some cool other nontraditional spots. In the end, it’s about the right retailers that fit our brand.

 Delivery truck

Delivery truck

 

When can we visit you at the retail showroom?  (3801 Stone Way N, Suite E)

 

Back to the whole things take time topic…, man, does it take forever to get into a new space. We hope to be in the new space and open in early June.

 

It’s easier than ever to serve highly tailored ads and find your target customer segment.  It also seems that there are a lot of well-made products launching every day.  For most of my existence online, I’d never clicked on a PPC ad.  Now I order products from podcast sponsors and buy $50 towels from Instagram.  With the proliferation of Shopify and small, quality consumer goods manufacturers, how do you separate yourself from the noise and compete for your piece of the disposable income pie?

 

Brand and Design.

Our backgrounds are in the brand marketing world, so we put a lot of stock into developing our own. What do we stand for? How do we behave? What’s our promise? It’s easy to copy a good product. It’s really hard to copy a good brand.

 

The other differentiator is design. It’s at the core of what we do. In fact, we’re as much a design company as we are an accessories company. We’re maniacal about the details that matter because great design is emotional. Our umbrellas should do more than keep you dry.

 

What has been the most rewarding part of launching this company?

Humility. Hands down. The amount of new stuff you learn, the process of moving from idea to application, and the pressure of controlling your own destiny, are all incredibly humbling.

 

What is the biggest mistake you made that you would never do again?

Assuming that you can make a great product in less than a year.

 

When you’re not working, your ideal day consists of ______?

To be honest, the good life is a lot of hanging out in the neighborhoods where we live. Going to shows and checking out new restaurants, walking dogs, and chasing kids. We’re all big into travelling, so maybe the ideal day is picking our way through an awesome new city on the other side of the world.

 

 

Coworking Simplified - Perfecting the tPC Member Experience

Since we opened the Pioneer Collective in 2015, we have attempted to learn from our customers, and refine our experience to meet demand.  We had zero experience running a shared workspace, but Audrey did an amazing job of forecasting back when the space was just a plan based on gut instincts and market research, but even she was surprised by some of the revenue streams that emerged, and some of our ideas that flopped.

the Pioneer Collective Conference

Initially, we borrowed from the LEAN startup methodology, test, listen, measure, adjust, repeat.  Essentially, if enough people requested a feature, product offering, or amenity, we would add it to the menu*.  We ended up adding an HD television display to our conference room (though we still dream of one day having a gadget free think-room), free La Croix to the beverage fridge, and 5 & 10 day membership options.  This strategy served us well in the early days, because it allowed us to find an audience (and revenue) while we searched for our audience.

After serious reflection, analysis, and debate, we've decided it's time to adjust our strategy to optimize our services and better serve our customers.  Starting in 2018, we will be moonlighting our Punchcard, Community 5, Community 10 and Team Pool memberships.  It's always tough to shut down a product that customers value, but ultimately we believe it's the best decision, both for our viability as a small business, our coworking members, and our awesome team of staff and community leads.

Coworking Streamlined:  Our New Membership Options

Starting in 2018, we've combined the best features of all our membership tiers into two, easy to understand offerings:

Community Membership - $225 per month

  • 8-6 M-F unlimited access to communal spaces
  • 500/500 Mbps High-speed fiber internet (Wireless)
  • 100 B&W prints per month
  • Fax/copy/scan
  • 3 hours conference room rental per month
  • Weekday access to showers, gym, bike storage
  • Full access to lounge area and kitchen
  • Phone booths and free long distance calls
  • Complimentary gourmet coffee & tea, beer and wine
  • 2 guest passes per month
  • Member social events and networking opportunities

Resident Membership - $475 per month

  • 24 hour / 7 day per week space access
  • Dedicated desk, Herman Miller office chair, task lamp
  • Drawer set, storage locker
  • 500/500 Mbps hard-line Ethernet data port & WiFi
  • 150 color prints per month, 300 B&W
  • Fax/copy/scan
  • 5 hours conference room rental per month
  • 24/7 private showers, bike storage, gym
  • Full access to lounge area and kitchen
  • Phone booths and free long distance calls
  • Complimentary gourmet coffee & tea, beer and wine
  • 3 guest passes per month
  • Member social events and networking opportunities
  • 25% discounted event space rental
  • Discounted rates for 6-month or 12-month prepay

The Rationale Behind the Change

As a small business operator, you are at a consistent disadvantage to your larger competitors when it comes to customer intelligence, data and technology.  Even if it is technologically feasible to collect data from all of your customers, your sample sizes are small and it's expensive and labor intensive to put those insights into action.  

When we started building out custom management software, rather than trying to beat our competitors at their own game, we decided to question assumptions we had long held and challenge the conventional wisdom in the industry.  

Early on, many prospective tPC customers asked for a flexible communal membership that allowed them to access the space 5 or 10 days per month.  Our 24/7 communal membership was priced rather high at around $325, so it made sense to introduce cheaper options to capture this part-time demand.  It worked in the short term, but it ultimately introduced a layer of complexity that became hard to manage once the program scaled, namely, how to keep track of and quantify use-days (e.g. if a member stops in for a 20 minute meeting, does that count as a day?  Do unused days rollover? etc.)

We started by trying to replicate what most white-label coworking SaaS apps did: allow users to check in when they use the space.  There are a few ways of doing this, including but not limited to RFID, WiFi authentication, iPad checkin, manual check-in, but what we found was that no matter what we implemented, these users were the least loyal, and the most likely to churn.  We'd essentially positioned the use of the space as a commodity and encouraged our customers to value time based on hours in the space, rather than how productive they were while they were here.  We were setting ourselves up to spend money and hours to engineer a solution for a customer segment that barely produced a positive ROI.

Questioning assumptions

I thought back to my time as a customer of coworking spaces in 2011.  People would often ask me, "why on earth would you spend hundreds of dollars a month on a desk when you can work from your kitchen table for free?"  I would always respond with some version of the following: "I spent a year working from my apartment and coffee shops, and the incremental work I can get done (or revenue I can generate) in the focused time I spend at my workspace, is worth thousands of dollars a month.  The value in my case is unquestionable."  In other words, we can all divide our time into $10 per hour work, $100 per hour work and $10,000 per hour work (those key hours of deep work each month which are responsible for a disproportionate amount of productivity, whether that is closing on a new contract, knocking out a writing assignments or meeting a contact that opens up an entirely new line of business).  We wanted to tap into that $10,000 per hour time and shift the focus back to output and away from hours.  In order to do that, we decided to eliminate all part-time memberships.  We also committed to lowering the price of our communal memberships to a level where two or three hours of focused output would justify the entire monthly cost for 90% of our customers.  And those for whom the math didn't add up probably weren't ideal coworking users to begin with, and would be better off at the kitchen table until they had more consistent cash flow. 

Members on the new Community Access plan can continue to use the space as little or as much as they need throughout the month, but they don't have to waste time counting days, and after they produce that single piece of high value deep work, the rest is gravy.  

We are aware that there is the potential for unintended consequences and blowback when implementing change.  While most part-time members were low LTV and high churn, some of our most loyal early adopters, joined at this tier.  We've already had to deny requests from past members looking to re-up on the old plans.  It's always tough to turn away revenue, but we're committed to seeing this experiment through.  Naturally, we grandfathered in any existing memberships and will continue to support them as long at tPC exists.  Moving forward though, we think the two membership tiers are the best product offering we can possibly put forward, and we're confident that they represent the best value in the Seattle coworking market. 

Time will tell, but so far revenue and loyalty are both up, and our software engineer and front desk staff are loving the elegance of the two-tier system.  We'll provide further updates at year-end.


Chris

 

*Requests to which we've never acquiesced include members bringing their own furniture, storing items in communal areas, or picking music.  It may sound dogmatic and/or pretentious, but we strongly believe that the physical space we inhabit contributes significantly to our well-being and productivity.  If a hundred people store boxes and personal items around the space and the music randomly oscillates between Charlie Parker and Kenny Chesney, it becomes very difficult to maintain a peaceful and inspiring environment.

December Membership Spotlight: Laura & Laura of Flying Crow Creative

 Photo by Lindsey Miller of lindseymillerphoto.com

Photo by Lindsey Miller of lindseymillerphoto.com

Laura and Laura are the founders of Flying Crow Creative, a branding and creative agency based in Seattle.  Laura Figueroa Ware (LW) is Principal and Head of Strategy & Content while Laura Urban Perry (LUP) is Head of Design & User Experience.  We caught up with the Lauras this month to discuss a variety of topics, including the state of marketing, design, and the city of Seattle.

LUP, you taught Web Design at Cornish and LW, you taught Business Storytelling and Brand Development at Georgetown.  Is that something you would like to do again?  

LW: Yes! I loved discussing marketing with professionals who were already practicing but wanted to expand their knowledge. I was terrified to teach, but I wanted to push myself to do something I’d never done before.

LUP:  I really enjoyed teaching at Cornish but it was a lot of work to do along side a freelance
design business. I’d think about it constantly. How to express the concepts behind
wayfinding and what elements make for compelling user experiences. But the number
one thing students wanted to learn was how to make things move.
I don’t think I’d teach again in a college setting.

Are there any skills you developed in those roles that have helped you with your day-to-day work or client interactions?

LW: I never realized how challenging it is to prepare curriculum. The experience gave me a whole new respect for teachers. In developing the coursework, I was able to think more in-depth about the theory behind marketing and storytelling and why certain things resonate with people. I love theory.

LUP:  People still love to see things move. Showing rather than telling always wins. Asking
questions to get to the real reason for their opinion, be it a student or a client, helps me
better explain why a solution works.

 

The tPC audience trends heavily toward entrepreneurs and freelancers, but also a number of remote workers who work for larger companies.  What are two things, positive and negative, most people don't realize until they've started their own business?

LW: If people thought too much about starting a business, no one would ever start one. For me the positives far outweigh the negatives. It can be tough not to have a steady salary to count on, or not having a staff to delegate to. But owning a business makes you grow in so many ways, such as managing business finances. My quality of life has improved because I control my schedule. And I feel much more comfortable following my instincts because at the end of the day, I answer to myself.

LUP:  One negative is how wonderful being paid while you’re not working is. Paid vacations
and sick days are a lovely thing. When you’re working for yourself, you’ve got to make
sure your HR person (you) works with your finance person (you) to set aside funds for
time off guilt-free to recharge. 

The big positive is being intentional about the work that you do, the product you create.
Your business is an expression of your life. It took me out of autopilot mode of a secure
job in tech into a more intentional creative mix of being actively engaged in my kids'
lives and designing my business. And I don’t miss unnecessary meetings, the office
politics and gossip.

On your website it says you know branding, graphic design, content strategy, web design and development, and communications planning.  How often does a client come to you looking for just a single service (e.g. migrating an old website to a responsive framework) and how often are you providing fully integrated strategy and creative services?  Do you prefer one approach to the other?

LW: More often than not, clients are looking for a single service. But that service (or tactic) may not be the answer to their problem. At Flying Crow, we like to spend time getting to know our clients and their business challenges, so that we can make the best recommendation for them about their brand and marketing efforts. For example, a business reached out to me last year to develop a marketing plan for them. But after learning more about their situation, I recommended brand perception research instead. It was a good move that gave them quite a bit of insight into what their clients are thinking.

LUP:  The integrated strategy is much preferred. Our added value is really understanding the full breadth of brand and marketing strategy as it is woven through every facet of a business. Helping our clients articulate and implement memorable creative throughout their business is really rewarding. We sometimes start with one project but often our questions lead our clients to consider a more comprehensive solution.

How has your trade changed since you began your career and what lessons and skills are just as important today as they were when you started out?

LW: The most significant changes have been rooted in technology. I remember working for an ad agency and having to Fed-Ex commercials to TV stations. Technology has forced marketers to be agile and to constantly be thinking about what’s next on the horizon. For example, social media has completely changed the way people interact with brands. In the past, the extent of our interaction was buying and using a product. Now people expect that brands will communicate with them, including addressing grievances in real-time. What does not change is the need to be a critical thinker and a problem solver. Good marketers are both analytical and creative, and they know when to let one supersede the other.

LUP:  I know the old ways. So if the internet broke, I could still design. The importance of a strong concept and meaning always wins over a polished generic idea. I love the craft of arranging information and ideas in ways that makes it clear. A good layout, white space and visual hierarchy are really important in web and UX work. And I still take time for excellent typography that people don’t see unless it’s not done.

 

As a small creative agency, I imagine you are constantly trying to balance the pressures of business development with the real deadlines and pressures of client work.  How do you juggle finding new business, servicing current clients and finding time to appreciate success and the little wins along the way?

 

LW: It is always good to have business in the pipeline, but my first priority is always our existing clients. They are already invested in Flying Crow as a partner, and I don’t want to let them down. It is important for business owners to make time for networking and business development, though. For better or worse, I evaluate wins and losses every day. It’s good to pat yourself and your team on the back when something goes well. You have to take the time to acknowledge a job well done rather than just jump the next thing that needs your attention. People need to know they’re appreciated.

LUP:  Client work always comes first. It gets the best part of my day. We get most of our work through referral so taking time to tend our network is important. Making personal connections is our best sales tool. Does going out for cocktails count as celebrating the successes along the way?

 


FILL IN THE BLANK!

 

A perfect weekend starts with _______ and ends with __________?

LW:  A perfect weekend starts with happy hour and ends with dinner and a movie or good book.
LUP:   A perfect weekend starts with a glass of wine on our rooftop deck with friends or a paddle in our kayak to our island cabin and ends with a nice home cooked meal with family.

 

_____ is totally underrated.

LW:  Sleep is totally underrated.
LUP:  Being totally disconnected from tech for a while is totally underrated.

 

_____is totally overrated.

LW:  Orange is the New Black is totally overrated.
LUP:  Snapchat is totally overrated.
orange-is-the-new-black-netflix.jpg

 

If I could eat any meal in the world, it would be _______ prepared by ______.

LW:  If I could eat any meal in the world, it would be Beef Stroganoff prepared by Albert Einstein.
LUP:  If I could eat any meal in the world, it would be Halibut prepared by David Beckham.
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If I got a surprise day off  tomorrow, I would _____.

LW:  If I got a surprise day off tomorrow, I would go shoe shopping
LUP:  If I got a surprise day off  tomorrow, I would pretend I was a guest at a downtown hotel, use their rooftop pool and then have lunch and write and sketch in the bar.

 


1:1 WITH LAURA URBAN PERRY

 

 Photo by Lindsey Miller of lindseymillerphoto.com

Photo by Lindsey Miller of lindseymillerphoto.com

It says on your bio that travel always resets your compass and fills you with new creative energy.  I feel the same way.  What is the most memorable trip you've taken and is there anywhere you find yourself returning to for inspiration?

LUP:  I won the parent lottery when I was a kid. My dad was a pilot for Pan Am. Do I have to pick one?

New Zealand fishing with my dad and brothers when I was a teenager.

Or...

Japan teaching art directors how to use Photoshop, Indesign when I was creative director for Adobe

Or...

Going to Spain and France with my husband and kids. We started in Madrid, then from Santiago de Compestela in the northwest corner to San Sebastian up to Paris to stay with a very dear friend and then to an island off the coast of France where her family had a summer place. We were there during the World Cup. In Spain when they were winning and then in France when they were in the semifinals. The whole city was crammed into the metro and the Champs Elysee chanting “Allez les Bleu.”

Though I haven’t returned in a long while, Japan is always inspiring. Everywhere you look things are artfully arranged and there’s plenty of the unexpected and odd to keep me laughing.

You were a creative director at Adobe.  Is there anything you miss about working for a large organization, for instance extensive financial and human resources?

LUP:  Budget for travel to conferences and being able to work with the design luminaries. I miss the team I pulled together, though we’ve stayed close over the years.

What tool, software or hardware, digital or analog, is most vital to your craft? (other than your computer)

LUP:  A printer. I know dead trees. I still like to print things and remove them from the distraction of the screen, get back from them and look at systems as a whole or a logo design from across the room.

And now the camera on my phone…for photographing inspiration.


1:1 WITH LAURA WARE

 

LW.png

What is the biggest mistake you see small companies and startups make when it comes to branding?

LW:  Understandably, they don’t have the resources to invest in marketing, so many of them don’t have a strategy. Then they realize they need a logo or website, so they ask their cousin Bill who worked at a print shop in 1987 to design one for them.

They want to sell a product or a service, but they don’t really know what they stand for, which is what branding is all about.


I see a lot of freelance and independent service providers ignoring marketing.  Designers, architects, and photographers seem to get it, but how should solo attorneys, engineers, and contractors approach branding and positioning?  

Many businesses, large and small, think marketing is a nice-to-have that you can build up to when you have excess cash, and that you can dispense with when times are lean. Marketing is, and should be, a key part of a business’ strategy. Through marketing, businesses learn about their audience, and formulate strategies for how to engage them. I would advise the professionals you mention to develop a business plan with growth goals clearly stated, determine how they need to shape and market their business to achieve those goals, and define what makes them different than others that offer the same services. These businesses likely obtain many clients through referral. But referrers have to understand who you are and what you do.

 

You grew up in Texas at attended UT.  What do you miss the most about the Lone Star State?  If you had to leave the PNW tomorrow, what would you miss the most about this region?

LW:  There is an unexplainable pride that comes with being a Texan. It’s in your blood. I miss my family and friends quite a bit. I also miss good Tex-Mex, BBQ and frozen margaritas. If I had to leave Seattle, I would greatly miss the friends and family I have here. I’d miss the incredible beauty of the area. And I’d miss having four seasons, which allows me to have a much broader wardrobe.

Thinking about opening a business in Seattle? Here are the taxes you'll owe. Part 1 of 2

Seattle provides a generally favorable atmosphere for entrepreneurs.  It boasts a vibrant economy that balances traditional industries, an international port, a thriving tech scene, aerospace, art, Fortune 500 companies and small businesses.  The city is home to multiple public and private universities and has a wealth of engineering and business talent.  All that being said, there are no shortage of taxes you'll face as a small business owner in Seattle.  While larger firms can often negotiate, lobby, threaten, cheat and hide their way out of paying taxes, you as a small business owner will be stuck paying 100% of what you owe.  Unfortunately, it's not always clear exactly what is required of you by law and in most cases, the government(s) won't send you an invoice or a reminder, so if you miss out on something, you'll end up owing late fees and back taxes. It's probably a good idea to hire a Seattle based tax accountant for official advice, but for starters, we've tried to come up with an exhaustive list of the taxes you will face while operating a business in Seattle and in the State of Washington.  

City of Seattle taxes

  • City of Seattle Business License - Official City definition: Each business engaging in business activities in Seattle must obtain and annually renew a City business license tax certificate unless the business activity is specifically exempted from licensing and taxes. Anyone engaging in business activities within Seattle is required to obtain a Seattle business license whether or not a place of business is maintained within city limits. A branch business license is required for each additional venue doing business. There are three ways to apply for a business license tax certificate: online, by mail or in person (42 nd floor of the Seattle Municipal Tower). In most cases, licenses cost $110 per year; small businesses with total revenues of less than $20,000 annually pay $55 per year. If you have more than one business location in Seattle, you must pay an additional $10 per year for each additional branch location. If you start your business in the second half of the year, after July 1, then your license tax certificate fee will be reduced by half. All licenses expire on Dec. 31. See more on how to get a license and who needs a license at http://www.seattle.gov/licenses. 

 

  • Regulatory License - Official City definition:  Regulatory License The City of Seattle further regulates specific business activities, e.g., the taxi/for-hire and transportation network company industry, marijuana businesses, tow companies, adult entertainment, amusement devices, pawnshops, etc. (see Businesses regulated by Seattle). Unless the business activity is specifically exempted, these businesses require both a standard business license tax certificate and a regulatory endorsement on the license. The application process varies for the different business types requiring a regulatory endorsement. See more at http://www.seattle.gov/business-regulations . 

 

  • Business and Occupation (B&O) Tax - This is a rather controversial tax, as it is applied whether your business makes, money, or loses it hand over first.  We found this out the hard way our first year in business because although we had negative net income, we had a reasonable amount of revenue.  One would imagine the tax is structured this way to disincentivize excessive write-offs.   Official City definition:  Every person or entity doing business within the city limits is subject to the business license tax unless specifically exempted by the Seattle Municipal Code. The Seattle business license tax, sometimes called the business and occupation tax (B&O tax), is applied to the gross revenue that businesses earn. Businesses with an annual taxable gross revenue of $100,000 or more are required to pay the tax. You do not pay the tax if your annual taxable gross revenue is less than $100,000 or if you have no business activity for the year. You are still required, however, to submit a return reporting your gross revenue, even if zero, to the City of Seattle. The Seattle business license tax rate varies by business type (see Tax Rates and Classifications). When filing your taxes, you may be required to fill out certain forms or worksheets depending on your business activities and gross revenue amount (see Special Tax Situations). There are a number of other taxes the City collects for applicable businesses in Seattle, including commercial parking, firearms and ammunition, gambling, utilities and admission (see Other Seattle Taxes). Businesses are also subject to property and sales taxes, though the City does not collect these taxes. See more at http://www.seattle.gov/business-license- tax. Deductions & Exemptions from the Business License Tax A deduction is revenue that you can legally subtract from your gross revenue amount. Although you must list the deduction amount on your return, you do not pay tax on that amount. Only deductions specifically defined in the Seattle Municipal Code are allowed (see the Deduction List). The costs of doing business cannot be deducted from your gross revenue amount. This includes: rent and utilities, insurance, material costs, employee wages, employee sales, cost of products purchased for resale. Exemptions are different than deductions. Certain organization and business types are not required to obtain a Seattle business license or pay the business license tax. Certain types of revenue are also exempt. You qualify for an exemption if your business or revenue type is defined as an exemption in the Seattle Municipal Code (see the Exemption List). You do not report exemptions on your tax return; you must report deduction amounts.

 

  • Business Improvement Area (BIA) Taxes - This one came as a surprise to us.  In our neighborhood, the BIA funds the Alliance for Pioneer Square, which leads some great initiatives around the neighborhood.  The problem was, no one was required to disclose this to us when we signed our lease, so we were hit by a surprise bill of over $1,000 right after we opened our doors (and were already hemorrhaging money).  This is billed annually based on square footage, so it hammers coworking spaces.  It was previously assessed based on gross receipts, but retailers protested and it was changed.  Official City definition:

    Business Improvement Areas (BIAs) are funding mechanisms for business district revitalization and management. Specifically, the mechanism is an assessment collected from businesses and/or properties within defined boundaries. The funds collected are used to provide services for the mutual benefit of the businesses and properties being assessed. BIAs include programs and services such as marketing, public area maintenance, security, parking, streetscape improvements and professional management. In Seattle, BIAs are enacted by the City Council, using the authority of state law (RCW 35.87A) and the City Charter. The legally required process for creating a BIA is fairly simple, but it is important to have the support of most of those who will pay the assessment in order for the process to move forward smoothly. This means a well-organized effort in the neighborhood that includes a focused dialogue with potentially affected ratepayers about the district’s needs and proposed services. Once there is general consensus on a work plan and budget for the district, the organizers work with City staff to prepare a formal proposal and petition of support for signature by prospective ratepayers. The group then presents these to the City Council, which will hold a public hearing before considering the proposed ordinance. BIAs can be renewed or terminated through a similar process. How long a BIA stays in place is up to the local organizers.  BIAs are governed by a Ratepayers Advisory Board, made up of those paying the assessment, which prepares an annual work program and submits it to the City. The City sends invoices to ratepayers, collects the assessments and reimburses the board according to the work program. BIA operations can be managed and implemented by a stand-alone BIA organization or through a contract with an existing organization. Services can be provided by BIA employees or through independent service providers.

     

    See more at http://www.seattle.gov/economicdevelopment/business-districts/business- improvement-areas

 

 

Part 2 will include information on:

  • King County taxes
  • Business personal property taxes
  • WA State taxes
  • Federal taxes

 

 

 

 

 

 

tPC member opens LEGO pop-up experience in Seattle

Phil Keller, a tPC member and founder of makethemost.com, has launched a pop-up LEGO retail shop in Seattle's Madison Valley neighborhood.  The shop will sell new and used sets, vintage collector sets, minifigs, and feature a large "pick-a-brick" bulk section.

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The store is located on Madison, across from City People's Nursery at 2914 East Madison Street, Suite 103, Seattle, WA.

Keep any eye out for special holiday promotions and deals in the days leading up to Christmas.

 

 

Check out the beta launch of Phil's revolutionary app that helps LEGO fans make the most of their collections at makethemost.com

tPC Member Spotlight: Rachel and Alison of Emily McDowell

After a battle with cancer, Emily McDowell launched an empathy card that was irreverent, emotional and unlike anything on the market.  Her eponymous company leveraged the success of that card to build a successful and beloved brand.  The company has since expanded into greeting cards, gifts, totes, notebooks and more.

Alison Keefe and Rachel Powell work for the company in Seattle, and when they are in town, get work done at the Pioneer Collective.  We caught up with them for this month's member spotlight.

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WORK STUFF

First of all, what do each of you do day-to-day for the company?

 

[Alison] I am the production and supply chain manager for Emily McDowell Studio -- which means I wear a lot of hats from inventory management, to designing catalogs and marketing materials, to coordinating with all our domestic and overseas vendors. (For context, we're a team of 7, located in Seattle, Los Angeles, and Illinois, plus a baller warehouse crew in Las Vegas.)
[Rachel] I'm the wholesale account coordinator for EMS, which basically means I do all things customer service on the wholesale part of the business. My duties range from order entry, phone calls to and from customers with questions, coordinating large orders from our distributors, and managing a territory map to make sure that none of our stockists are too close to each other.

 

While reading about the history of the company, it seems like Emily McDowell's empathy greeting cards struck a cord and received an enormous amount of press attention and earned media right away.  That seems like any small business' dream, but I imagine it can also be hard to respond to from a production standpoint.  Was it difficult for the company to keep up with demand initially?

[Alison] The Empathy Card release was actually before both of our times with EMS, but I joined the company shortly after. It was truly an explosive moment for the brand. At the time, the team was still fulfilling orders from a studio in downtown LA (we hadn't yet expanded to our Vegas warehouse). It provided some logistical challenges, for sure, but fortunately we work with a great local LA printer and had a dedicated team of people to make it all happen. Also, I know everyone was really encouraged by the massive out-pouring of people who contacted Emily to express their gratitude for creating a line that was so lacking in the greeting card world.

 

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It also seems like a massive wave of press could lead to a sort of "sophomore slump", where it's difficult to match that initial fever of interest.  How did the company maintain a sustainable wave of demand?

[Alison] Emily's voice is what drives this brand. She has a real insight into how people think, feel, react. It's what makes the line so relatable. In our catalog, we have a line that says that "we find it creepily satisfying whenever a customer asks if we’ve been reading their diary, because it means we’re doing something right." People gravitate to things that make them feel understood. It's a reminder we're all in this together.  
[Rachel] I agree with Alison that Emily's voice (she's so clever!) is definitely the driving force of the brand. I'd also add that expanding into gift items after beginning with just greeting cards has kept customers excited about what's coming next! Part of any successful brand is knowing what people want - and being able to capture the same "feel" of the greeting cards in fun things like gift bags, pouches, and enamel pins, I think, has been a great move.
 

 

My aunt has spent her entire career in the greeting card industry.  I remember asking her about threats to the industry when CreateACard kiosks started popping up and again with websites like Paperless Post and eVite gained traction, yet it seems that tactile paper cards are still the medium of choice for expressing grief, empathy, thanks, congratulations etc.  Will there always be a place for that level of thoughtfulness and formality, or will we eventually submit to sending valentines written by a neural net?

[Alison] As a paper-lover myself, I am probably somewhat biased, but I think there will always be something special and more meaningful about a tactile object you send to someone. Our customers seem to agree! And the fact that there are so many amazing brick and mortar stores we work with all over the country -- and the globe! -- further proves there's tons of us paper freaks out there. 
[Rachel] I'm pretty biased towards paper goods also, but I do think that anything that takes more effort than typing on a computer/phone will always feel more meaningful to the receiver. Handmade items are having a resurgence because everything else is so available, and while we love that (thank you, Amazon!), there's nothing like opening an envelope and seeing someone's handwriting on a card, even if it's just their name. 

 

How much of Emily McDowell sales are online vs wholesale or brick and mortar resale?

[Alison] Interestingly, it varies from product category to product category. Our online retail site definitely drives a lot of revenue, but our wholesale brick and mortar sales are a real backbone of the business, and what helped launch it all to begin with. I'd say stores have a stronger drive for our dimensional products (tote bags, canvas pouches, magnets, pins, and so on), and online cards are definitely king.
 

Where do you see the industry in five years?  Ten years?  Eleven years?

[Alison] Both Rachel and I get to travel to trade shows where we meet tons of amazing entrepreneurs from across the country. I think with this number of hand-working, creative minds, the stationery and gift industry will only continue to grow, and of course adapt where it needs (iPhone covers, which we sadly do not produce, were all over the place the last few years). 
[Rachel] I'm always amazed by the creative people in our industry. Just when I wonder "what's coming next?" someone has a great idea! I'm still pretty new to this job (it'll be a year for me in November) so I'm not sure I can say I see where it's headed in 10 years, but I definitely plan to be along for the ride!

 

FUN STUFF

 

What are your favorite unknown hangout spots in Seattle / WA?

[Alison]  I'm a big fan of Georgetown, having made my first real 'home' in Seattle there. Full of great dives, art studios, funky wares. (Plus, free pool at Seattle Tavern on Sundays, but I'll fight you for a table...)
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[Rachel] Well I wouldn't necessarily consider these "unknown" spots - but my 2 favorites(being a Ballard gal, through and through) are Sunset Hill Park and Golden Gardens Beach. One caveat though, is that both of these places are MUCH better in the fall/winter. I love bundling up and heading to either one to stare at the water, mountains, and boats, and sit on a bench and think about how we live in the most beautiful place ever.

The best meal in the city can be found at ________

[Alison] ...Ciudad (also in Georgetown). 
[Rachel] ...Picolino's (also in Ballard!). Their homemade pasta is to die for, and I love the neighborhood vibe. It never disappoints.
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If you had a surprise four week vacation handed to you, you would _____?

[Alison] I would travel to southeast Asia. It's been on the list, just have to make the time!
[Rachel]   I'd do a tour of Scandinavia. I am so fascinated by those cultures and would love to learn more about them. Plus, I could probably get some great yarn for more knitting projects!

 

Living and working in Seattle is great because _____

[Alison] Living and working in Seattle is great because, as cliche as it sounds, the natural beauty is just so unparalleled. Commuting via LightRail is also a huge bonus, having moved here from Los Angeles via New York.
[Rachel] ....it both feels like a small town with all the different neighborhoods, but also has things I couldn't find outside of a city (great restaurants, art museums, etc.).

Living and working in Seattle would be better if ________

[Alison]  Living and working in Seattle would be better if there were less tech-bros crowding me on the train (sorry). 
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[Rachel]  ... I honestly can't think of anything. I really love it here!

I am currently reading_______

[Alison]  The Master and Margarita by Mikhail Bulgakov. 
[Rachel]  I am currently reading too many books about babies (our first is due in December), the most recent of which is "The Birth Partner" by Penny Simkin.

 

The most underrated show/movie of all time is ________

[Alison] The most underrated movie of all time is Jaws -- seriously, I'm crazy about Jaws. I watch it every 4th of July. 
[Rachel]  The most underrated show/movie of all time is "High Society" with Grace Kelly, Bing Crosby, Frank Sinatra, & Celeste Holm. I'm a sucker for old movies, especially musicals, and I've never understood why this one doesn't get the same response as others like "Singin' in the Rain." 

_____ is better than people think.

[Alison] Vegetarianism is better than people think (ahem, Ryan...)
[Rachel] Knitting is better than people think.

A Shoestring Fitout - the Canopy Room Experiment

 Before: End of August 2017

Before: End of August 2017

 After: End of September 2017  Courtesy of Lindsey Miller Photo

After: End of September 2017

Courtesy of Lindsey Miller Photo

With growing demand for more space and services at tPC, we recently acquired an additional 2300 square foot suite on the fifth floor of our current building, The Westland Building. We were able to secure this space within our budget because it lacked the typical tenant improvements a building owner usually puts into a suite to make it market-ready.  We opted to save money and do the necessary improvements ourselves, with the help of various subcontractors. The time between first viewing this space and hosting our first corporate client for a day-long offsite was exactly one month. Our very tight timeline and budget created an exciting challenge for us. Below we share the scope of the project as well as thank the handful of individuals and companies we relied on in completing this buildout so quickly.


Scope of work: 

 Courtesy of Lindsey Miller Photo

Courtesy of Lindsey Miller Photo

  • Cat6 cabling and installation of ports and APs for high-speed internet
  • Drywall work and repair
  • Fresh primer paint on walls and ceilings
  • Refinishing and painting of floors
  • Installation of conduit, wiring, electrical outlets and ports
  • Installing lighting fixtures
  • Design, material procurement, and assembly of 24 additional tables and desks, with seating for 48
  • Soundproofing and acoustic planning and installation

 

When we first took possession of the space, we needed to decide what to do with the floors. The subfloor functioned, but it was comprised of large mismatched sheets of plywood. Reluctant to invest in brand new flooring when the subfloor was in good condition, Chris experimented with some paint and sanding and opted to give the floors an aesthetic makeover. After a bit of testing, Chris found a glossy white porch paint and primer that could be applied after filling seams and re-sanding (and pulling thousands of staples from the old carpet), adding a clean, light, and bright solution.

While Chris was experimenting with porch paints, we called in our drywall expert Marshall, to start repairing walls. There were holes in the walls that needed fresh sheetrock and mud.  That work took about four 8 hour nights.  In addition, the wood ceiling beams were in need of care so we found a matching grey paint to refresh those. We hired a couple of hardworking subs that handled the floor and ceiling paint jobs.

During this work, Chris designed an ideal modular desk that could be grouped with other individual desks, allowing various configurations for an array of programming needs. The ultimate goal of the additional space is to serve the unique needs of larger groups. This can range from utilizing the space as a classroom with a microphone and projector, to an all-day film shoot or evening happy hour. The considerations when designing the desks were dimensions, base style, and material that would create a product easily maneuverable while also structurally sound and durable.

Chris worked with metalworker Don Goble of Weld & Glue to design and manufacture the bases. His sister Ashley, of Sierra Forest Products ,spec'd and procured the high gloss laminate desktops.  For chairs, we needed a lightweight, stackable, ergonomic solution that would be attractive paired with the tabletops. After hearing about Article.com on Roman Mars' 99% Invisible podcast and purchasing one of their outdoor dining sets for our home this summer, we chose to source our chairs through them. We wanted an option that could bring a pop of color into the space. We chose their Dot chair in green and turquoise to compliment the colors of the foliage on the west side of the space.

 Courtesy of Lindsey Miller Photo

Courtesy of Lindsey Miller Photo

A special thank you to Article!  Aside from working on a tight timeline and dealing with a somewhat uncertain scope of work, one of our most challenging moments came after ordering our chairs. While Chris was unloading the first four of sixteen chairs, the remaining twelve were stolen off the loading dock behind our building. This was very discouraging, particularly since this neighborhood has become a second home to us, and we care greatly about its viability and safety. Amazingly, after sharing the story with Article and trying to order new chairs, they sent us a replacement shipment free of charge!  We are very appreciative of their commitment to customer service.  They have real people answering customer service inquiries, fast shipping and a great return policy.  We don't often plug brands here, but we are huge supporters of this company.

We are still adding decor, but have found a few second-hand steals such as the midcentury tulip tables pictured from Goodwill for $10. We've thrown old framed artwork on the walls to give the room some color, and of course, have added potted plants.  We want to thank Burrow, who outfitted us with a sleek, highly functional, office couch complete with charging capabilities and a USB port. Chris worked with our go-to electrician conduit and hardwired barn pendants in the central seating area in addition to hanging a few sets of stringers.  Finally, we cut and attached baseboards and performed a deep clean of window sills, heat registers, windows and doors.

We're still making small tweaks here and there, but after the initial buildout, we've been able to start utilizing the space and have now hosted a variety of events; a few corporate off-site sessions, an auditorium-style panel of speakers for Seattle Startup Week, as well as a customer appreciation event for Dia & Co, a women's fashion company that provides hand-picked plus-sized pieces by stylists delivered directly to your door. Lastly, we want to give Lindsey Miller Photo a big thanks for providing some beautiful professional shots of The Canopy Room. Our calendar is now filling up many exciting new events and we look forward to hosting more.

Our build budget was $11,000 for the entire project including furniture and electronics.  We knew that would be a reach, but we came close, at around $12,500.   The biggest contributing factor to the overrun was paint.  We ended up buying twice what we had planned for, as the old subfloor really soaked up the paint and primer.


Interested in renting the Canopy Room?  The space works great for:

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Seating Arrangements

Our custom desk-tables are designed to accommodate all of the above setups

  • Corporate trainings
  • Classroom-style events
  • Production: photo and video shoots
  • Workshops
  • Creative brainstorming sessions
  • Launch parties
  • Happy hours
  • Hackathons
  • Seminars
  • Lectures/Presentations

 

 


Need to find and fitout office space or redesign your current setup? We would love to help. We provide consulting, design services, and project management. Email us at team@thepioneercollective.com

What coworking tools and software does the Pioneer Collective use? Part 1 of 2

Running a successful shared workspace involves the management of many discrete systems and processes.  Access control, member communication, membership management, billing, room-booking, and IT are all vital components of a thriving space.  If you're a coworking space owner, manager, you've probably spent some time thinking about shared workspace space management software.  The coworking forums on Google Groups and the coworking Wiki are full of people asking this question:  "What is the ideal software for running my space?" 

There are differing opinions, but they generally fall into three camps:

In the first camp, are operators who pay a recurring licensing fee for an all-in-one SaaS solution to manage all administrative processes. 

In the second camp, are space operators who build (or pay someone to build) a custom, proprietary all-in-one solution. 

Finally, in the third camp, are space operators who use a patchwork of stand-alone solutions specifically designed for each task. 

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18 months into our journey at the Pioneer Collective, we began re-evaluating the need for management software, as membership increased and our team grew to two owners, one staff person, and multiple community leads.  Each approach has its merits, and the right strategy for a given organization is largely dictated by the complexity, size, and culture of the space.  Ultimately, we opted for a hybrid of the second and third approaches.  I'll explain our systems in detail in the second part of this post, but first, I'd like to highlight some of the all-in-one solutions we looked at, and why we ended up passing.

 

All-in-One Coworking Software Solutions

 

The Nadine Project - free / open-source

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Nadine is an open source solution built by Jacob Sayles and team at Office Nomads in Seattle.  These guys are some of the OGs of the coworking movement, and they really know what they are doing.  You can bet that all of the features built into the software were included for a very good reason.   The software is free, but it's also open-source, meaning you'll need to deploy it and support it on your own for the most part.  At some point we'd like to deploy Nadine at tPC and try running the space with it, but when we were getting started, we decided it would be too difficult, as we didn't have any Python/Django developers on staff to help out, should we break something.  Jacob, Alex and team just pushed on a massive update to the platform that is designed to allow other spaces to adopt it.  We're excited to check it out!

 

HappyDesk $199 / month per location

We demo'd WUN's HappyDesk during the first few months after tPC opened.  Their product support was good and their pricing was acceptable, but we found the product completely overwhelming.  There were so many features that weren't relevant to our space at the time (e.g. selling conference room hours or print jobs to members and the public) that it was hard to cut through the noise and imagine using the product day-to-day.  From what I've heard, they've simplified the design in the 18 months since we tried it, but at the time, it was over-engineered for our needs.

Meshwork - 3% of all sales (in addition to regular payment processing charge)

Last month, we played around in a Meshwork demo account and came away thoroughly impressed.  The UI and color schemes are sleek and beautiful.  All of the features are intuitive, and it feels like thought was put into where everything is placed and why.  Meshwork includes basic space management features (membership and billing, member onboarding, CRM) and also a business intelligence and reporting component.  We were actually considering implementing the software on a trial basis until we got to the pricing discussion.  Unlike other SaaS providers, which charge monthly or annual license fees, Meshwork opted for a percentage of sales approach.  The company takes 2.5-3% of all revenue which goes through the system depending on volume.  This is in addition to any payment processing fees you already pay.  I totally understand why they structured their pricing this way.  It allows upstart coworking spaces to afford the license, and grow with the software.  It's also probably very fairly priced for what you get.  The argument could even be made that you could make up that 3% in incremental sales, by having a more organized space.  At the end of the day however, we just couldn't get used to adding another variable expense to our income statement.  With a monthly fee, even if it's steep, it is a fixed cost that allows you to achieve an economy of scale once you meet a threshold amount of revenue each month (I.e. you pay $399 per month whether you book $15,000 in revenue or $30,000).  On the other hand, the Meshwork pricing amounts to a 3% tax on revenue, shrinking profit margins now and for all revenue you bring in as long as you're on the system.   In other words, if we booked $15,000 in revenue, we would pay $450 that month for the service.  If we sold $30,000 in revenue, we'd pay $900.   This didn't make financial sense for us, even with the obvious benefits and impressive design of the software. 

Other popular coworking software solutions we haven't tried:

  • Nexudus
  • Cobot
  • Optix

 

Part 2 of 2  - In the next installment of this post, I'll detail what software tPC actually uses and why we decided to build a custom application for the management of our workspace.  The benefit of the piecemeal approach is that each solution is really good at doing exactly the task it was designed for.  The downside is that it makes training and process building a huge pain, as we have to show every new trainee each piece of software, manage logins etc.  We're working toward building a custom portal on top of these solutions that ties the workflows together more intuitively.  

Door Control - RFID readers + key deposits

Membership Management - Stripe + Proprietary App

CRM - Streak for GMail.  (awesome)

Internal Members Database - Memberfindme - we'll likely build this functionality into our custom app

To-do - Google tasks, Google Calendar, Trello for projects.  We're also working on a dynamic task list feature for our staff portal. 

Room booking - YaRooms

Communication

  • Staff to staff - Slack, email
  • Member to member  - Slack and Memberfindme
  • Staff to member - Slack (fun things), Mailchimp (important things e.g. holiday hours)

WiFi - Unifi UAPs

A plug for a volunteer opportunity close to my heart

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It's the start of the school year again and fall is in the air.  In our household, this has always mean the start of a new tutoring relationship with a local student.

Chris and I have been involved with an organization called Invest in Youth, for a combined 10+ years. Chris served on the board for several years and we have both tutored at several Seattle elementary schools.

Each year I've tutored, I've had a single student assigned to me for the entire year. Being able to provide academic help to an individual student for nine months is very rewarding and I've felt appreciated by each student I've gotten to know. Every October has been marked by the anticipation of meeting my new student, getting familiar with the school layout and program manager, participating in the one-day tutor training, and meeting the other tutors.

This year, I had hoped to tutor again at Roxhill Elementary, in West Seattle. I recently realized however, that the timing with childcare for our two girls won't allow me to commit to the weekly Monday session from 2:45-3:45pm. I do plan to be a substitute when Chris and I can make it work.

Because I'm disappointed that I'm not able to fully participate this year, I'd like to spread the word about how great Invest in Youth is and find others out there who are looking for a rewarding volunteer experience. Last year, Invest in Youth put together an informal presentation at The Pioneer Collective and gained two new tutors out of it. These two tPC members were such valuable tutors for Invest in Youth, that this year the organization plans to stop by and provide another informal presentation with lunch, on September 21st.

It is open to anyone interested in learning more. We would love to have you contact us if you are interested.

Full disclosure: my mother, Harriett Morton, started this organization in 1997 which makes it particularly close to my heart.

Here's a bit more from the organization:

If you're looking for a way to get involved or give back to your community, this could be your opportunity! Invest in Youth is looking for role model tutors to work one-on-one with elementary students at local schools, including Madrona Elementary, Thurgood Marshall Elementary, Daniel Bagley Elementary, Roxhill Elementary and Beacon Hill International. 

Tutoring begins the second week of October, runs through May, and takes place once every week at each school.

Each tutor is matched with the same student for the whole school year, and the pair works together on things like homework, playing math games, or reading stories, for one hour each week. Educational materials and activities, training and support, and heartfelt appreciation are provided at every session. 

For more information or to apply to be a tutor, please contact Erika Chen at echen@investinyouth.org or visit our website: https://www.investinyouth.org/volunteer/ 

Can't commit to the full school year? Become a substitute tutor or share this with your friends who might be interested.