So... meta thread on unit economics. In LA, pre-Covid average rates were like $3/sf so a 1000 sf space would be 3k. I’d guess many of these ideas would only start to get interesting if it drops below $2/sf. What the picture in your city? https://hughesmarino.com/los-angeles/blog/2019/11/04/as-rents-continue-to-increase-cre-markets-remain-flat-in-los-angeles-for-q3/ …https://twitter.com/vgr/status/1302282689844633601 …
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Let’s assume $2000. Put in 3-4 slightly nicer 3d printers ($3000), a laser cutter ($3000), 2 electronics workbenches (decently kitted out at say 3k each... oscilloscope, bench supply, soldering iron...). A couple of supply storage cabinets, a good optical table... we’re at 50k.
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If you had say 40 members paying $100/mo (~ mid-range gym), you have 4k revenue. Variable costs: rent, utilities, insurance, cheaper supplies for free (solder, coffee). Assume 5% repair/maintenance/year so that’s another $200. Let’s say $1000. So $1k gross margin.
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You’d make your capex outlay back in 48 months, not counting amortization tax benefit. So that’s $1000 free cash flow. Maintaining 40 people membership at $100 would be quite hard though. But you could add 3 value-added services... coaching, simple outsourcing, and remote fab.
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Think of these as members who offer other members and external people help. Basically like gym trainers who turn a profit on their membership fees without being underwritten by the space manager. So I think small-scale makerspaces are a feasible use of converted retail below $2k
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Unlike first-gen maker spaces that were larger destination communities and max a handful in a city, this could be scaled down to one in every neighborhood. Starbucks or 24x7 fitness level proliferation.
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Venkatesh Rao Retweeted Krampus with Golem Characteristics
Hmm... this is a huge, well-equipped space at $150/mo membership. I wonder if this market naturally wants to aggregate or decentralize.https://twitter.com/DavidRalin/status/1302307626865233920 …
Venkatesh Rao added,
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Replying to @vgr
Usually it splits into amateur makerspaces with club atmospheres, and pro ones with better equipment / more skills with business atmospheres.
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Replying to @NickPinkston
In both cases, the ones I’ve seen seem much larger than what I’m imagining.
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Replying to @vgr
Yea, I think at 1000 sqft it will be tough to add enough value
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I suspect median Main Street Covid-failed retail business would be that size. I suspect it would be feasible if a lot more people get into entry-level making/diy.
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Replying to @vgr
Main issue is the shared space will have limits during Covid and rent prices will rise post Covid. I'm still bearish on maker movement making big gains in community size. It feels at maturity to me.
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