On Tuesday, D.C.-based “neighborhood productivity space” provider Cove announced that it had raised a $2.8 million Series A round led by an unnamed investor group and unspecified institutional fund. The funding will be used to expand—effectively enabling Cove to open several new tech-centric locations in the D.C. area and its first office in the city of Boston.
Since being established in 2014, Cove CEO/co-founder Adam Segal and his team have been able to quickly grow the company. With its own unique approach and style, Cove became a popular staple of the D.C. tech scene as it afforded many young entrepreneurs an affordable office space solution.
We spoke with Segal about Cove’s recent funding news and what this may mean for both the company and its next “generation” of tenants/customers.
Here’s our full interview:
[Chris Bing] Q: Is there any further information you can disclose regarding the investors who led this round?
[Adam Segal] A: When I originally developed the concept for cove, I really considered it a shared economy company - with the benefit of a shared community. The first person I pitched the concept to when looking to raise seed capital was Peter Aldrich, one of the original investors and Board members of Zipcar (in addition to a number of other startups). Peter took to the concept, and approached other investors of Zipcar. Ultimately, cove's seed investors all had a heavy hand in the early days of Zipcar, and for the benefit of me, have now added great value to the development of cove. Peter has sat on the Board of cove from prior to launch and continues in that role today.
Q: Could you comment further on the establishment of new Cove locations in the D.C. area?
A: While we will be opening in Boston, cove will continue to expand in DC and connect more neighborhoods to the cove community and our network of productive spaces. We currently have nine locations; you will see more popping up in the coming few months. We’re taking a close look at locations in Maryland.
Q: What’s the deal with Boston…Which is to say, what was Cove’s thought process in deciding to open a Boston location? Why do you believe this as a smart move?
A: Boston is a great city that, in many ways, has similar aspects to DC especially around the distinct neighborhoods. Additionally, because of the travel between DC and Boston, we also believe having Boston locations that you can access will add value to being a cove member in DC. To be clear, we remain headquartered in DC.
Q: Given the funding round, does Cove plan to grow its staff?
A: Yes, we have been and are continuing to grow the team and infrastructure to support an organization in two cities. Not only will members be able to access locations in Boston and DC, but the team will also be traveling and growing both cities. We have now grown to 14 fulltime people, including six recent hires.
Q: With the newly raised $2.8M, how does this position Cove in an ever competitive co-working space market like D.C.?
A: We do not consider ourselves a competitor to coworking spaces. Coworking spaces typically provide an alternative to a traditional office - that is someone who uses it as a dedicated solution. cove is your neighborhood productive space. We want to be part of your lifestyle - you go to your local gym, grab a coffee from your local coffee shop, and pop into your neighborhood cove. While Starbucks really helped evolve this concept of the "third place," cove is providing a "fourth place" - your neighborhood productive space. In today's “on-the-go, always-on” digitally connected world, most everyone has a need for cove, whether you work from your couch, struggle to find an outlet at the coffee shop, or want to get out of the office. We are exited to bring these people and groups together at coves in neighborhoods across this city.
Q: Will D.C. remain the company’s focus for the foreseeable future?
A: We are first and foremost a DC-based startup - started in DC, for DC. What's so exciting for us as a growth organization is that we are now taking cove to new markets outside of DC. I hope that we can shed additional light on DC as a place to start your business or startup regardless if you are servicing the government, businesses, or consumers. DC is a great city, and the city is in cove's DNA.
