Analytics For Coworking Spaces

Published by Austin Gray
July 4, 2020

FRIDEA #6: Analytics For Coworking Spaces



Having a mentor in the B2B SaaS industry, I've learned some valuable data insights to apply to my coworking business.

By following the SaaS market, I've become convinced that metrics like the following can and should be tracked in any subscription business:

Average Revenue Per User (ARPU) - measures the average amount of revenue generated by each customer. This is calculated by taking the total amount of revenue generated in a month and dividing by the total customer count for the given month.

Customer Lifetime Value (CLTV) - indicates how much revenue a company can expect from a customer throughout the term of the business relationship.

In simple terms, let's say you charge $250 per month for a product and your customer stays with you on average for 10 months. Your CLTV would be $2500.

This is an important metric to know because it allows you to build a base for your marketing budget.

A good rule of thumb is to not spend any more than 1/3 of your CLTV to acquire a new customer. If the CLTV of a customer is $2500, then you shouldn't spend any more than $833 on sales and marketing.

User Churn - indicates how many customers stop paying during the current month in relationship to the total customer count.

For example, if your total customer count is 100 and 10 customers cancel, your church rate is 10%.

Cancelled customers (10) / Total Customers (100) = 10%

This metric is beneficial to know each month because it gives you a good depiction of how many customers you're retaining each month.

If you'd like to see this data being modeled in real time, Baremetrics offers a live demo of their current metrics for you to view.

Problem:


As a coworking operator, I would love to view these metrics within my Proximity (member management software) dashboard.

Baremetrics is built specifically for SaaS companies and there's a massive market full of untouched coworking spaces who could benefit from viewing metrics like CLTV, ARPU, and churn on a monthly basis.

(19,000 spaces in the world and 5,000 in the U.S. last time I checked)


Solution:


Build an analytics platform by modeling Baremetrics and customize it to integrate with coworking software platforms such as Proximity, Nexudus, Cobot, and OfficeRnD.

And then change the marketing to specifically target coworking space operators.

As an operator, I'd easily pay somewhere between $29-$99 per month based on the depth of the analytics.

Even if you only charged $29 per month and sold 1/5 of the US market that's 29k per month in revenue.

1,000 x $29 = $29k per month

Not bad for a bootstrapped software company. And I think an experienced software developer could build an MVP rather quickly.

For time frame reference, we just finished building the MVP for a similar tool, RunRate, in a couple weeks as a side project.

What do you think?


Would love to hear your thoughts and feedback on this. Send me a reply here or on Twitter and let me know what you think!

End Note

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