Artisan Alliance’s Sarah Pontius, Dani Arps On Pairing Office Design and Brokerage

Duo bootstrapped the firm during the pandemic with VC giant Union Square Ventures as its initial client

reprints


The roots of Artisan Alliance stem from a simple accident.

Sarah Pontius — a broker who cut her teeth at Brookfield Properties and CBRE — was about to leave her post at WeWork (WE) and was trying to get into the coworking giant’s location at 902 Broadway when she hit the wrong elevator button. Instead of seeing a WeWork, she stepped into SeatGeek’s office.

SEE ALSO: Mike Tepedino’s Blue Light Capital Bolsters Credit Lending Arm With New Hires

“I’d like to work here,” she thought. “This looks cool, this looks fun.”

Pontius knew she had to meet the person behind the space. She found out it was Dani Arps, an interior designer working for her own eponymous firm that mainly catered to tech clients. So Pontius slid into Arps’s LinkedIn DMs.

Arps thought Pontius’s resume was “super impressive” so the pair got coffee in December 2019, and Arps talked about her recent frustrations with the workflow of designing offices after working on a pair of spaces for startup Rokt in Australia.

“I was working on two installations at the same time that had the same issues of finger-pointing and 15 consultants being involved on one project and no one necessarily knows each other,” Arps said. “It doesn’t need to be so overly complicated.”

Rather than just complain about the issues, the two had an idea. Instead of a broker leasing space to a tenant, leaving after the deal is signed, and then an interior designer stepping in and having to sort out any issues with the landlord, why not merge the two functions?

So, during the height of COVID-19, Pontius and Arps bootstrapped Artisan with the aim of involving interior designers from step one of the office leasing process, and then having the broker stay on through the design phase to resolve any problems that come up.

The team has already leased and designed offices for Rokt, venture capital firm Union Square Ventures, the Malala Fund and Daily Harvest — plus a host of other companies Arps and Pontius were mum about, citing strict nondisclosure agreements.

Artisan — which now counts about 10 employees — also is in the process of starting a business line to design and manufacture office furniture that looks suitable for a luxury apartment along with a wellness pod for employees. They plan to launch those products next year, and couldn’t give much away about the plans.

Commercial Observer sat down with Arps and Pontius in late October to talk about starting a brokerage during COVID, the issues that come up during the design process, and diversity in the industry.

This interview has been edited for length and clarity.

Commercial Observer: Can you talk me through working with a client and the lifespan of it and how that differs from traditional brokerage and interior design?

Dani Arps: The idea is that, if someone comes to us, all they have to say is I need a new office. And a lot of the people that we’ve worked with have never done this process before — oftentimes, it’s either like the chief financial officer or sometimes the office manager, who now it’s their role is to find a new space for the company — and we wanted to make it easier in terms of what does that process look like. You only have to speak to us and we’ll educate you on it and we’ll give you all the options needed.

It always starts with brokerage, obviously. Sarah and the brokerage team will get information from the client, like how many people do you have? How much space do you think you’ll need? So when Sarah’s team has whittled it down to the top three locations, that’s when my team comes into play and we’ll do test fits. It sounds a little bit risky because, obviously, we’re starting with the design before the lease is signed; however, we do it in a way that’s more concept-focused.

Sarah Pontius: Our brokerage stays through to the end, so our team gets held accountable for anything that’s negotiated. I’ll go to the project management team a lot and ask questions throughout the lease negotiations to make sure they’re comfortable.

How does that help clients during the process?

Pontius: We had one instance where a landlord said, “You can’t put those stairs in.” 

Arps: We sent a couple of different renderings being like, “OK, if we can’t do these, here’s some other options.”

Pontius: Then [Dani’s] talking to me and I was like, hold on a minute. So we pulled out the lease, and we worked through it with the owner and we were able to get the stairs approved. I want to make sure the brokerage team is in this to the very end, and I said this to a client recently who was worried we were just going to hand it off to someone. I said, “No. Whatever we’re deciding now, you’re going to come back to us and we’re going to make sure it’s there until the day you move into the space.”

It means we can take on less clients; it means we can’t do as many deals because we are very hands-on with each client. But I think they’re being serviced better. We think long term that it will make enough of a difference for our client that it will help us be able to build the business and bring in more people to join us. There’s so many things I’ve wanted to change about the industry over the years, and now that I’m older I realize I can only change small things.

What other problems do you think the industry has?

Pontius: I get really frustrated with the lack of diversity in the industry. Maybe you don’t outwardly say it, Dani, but Dani seems to be someone who, when I talk to her about it, instead of complaining or just being angry or upset, she thinks just keep working so that other people can see that you can be a top designer.

Arps: That was one of our top concerns and how we can help in a small way. We do have a mentorship program where we bring on specifically young women of color — teenagers — because the reason why there aren’t people in the industry is because they don’t necessarily know about it. If you’re not exposed to it, how can you even know to be going to the right schools for it? So we wanted to bring on kids at an age where we can show this is an option for you too. For me, just being in the field, that’s enough to say, “Oh, she looks like me, I can do that too.”

I think one of the rewarding things is when, in one of our first meetings, the contractor looks up at the table, and he’s like, “There’s a lot of women.” And I’m like, “We own the company.” He was shocked, but that’s a pretty cool feeling when you look at the table and see it diversify.

You started this business mainly during COVID, and, while it’s not just a brokerage, brokerage is a part of it. How did you take the leap of faith to do it without investors during a time when the office market was in pretty terrible shape?

Pontius: The downturn didn’t concern me as much because I’ve been through downturns, but I knew that it would come back in some ways. Downturns always happen, downturns are inevitable, we’re going through one now, we’re going to go through another one. It’s humbling for the most well-capitalized companies, but if you’re smart you can get through them. If you’ve been through them, you know how to work through them. There was never a time where I thought we’re going to go under or this isn’t going to work because nobody wants to be at the office. I just knew we’ve got to think differently about how people are going to work.

Arps: People are going to need to come back to the office eventually. Can we create a company that helps you with that issue? Creating a one-stop shop-type of company where we’ll find the space for you based on the needs of what a post-pandemic world looks like sounded like a good business strategy. That’s the question du jour, “How do we get people back into the office?” Well, hire Artisan, because we’ll give you workplace strategy, we’ll find the right location, we’ll let you know how much space is needed. It sounded so reasonable because there’s a clear problem here and people need a solution.

What made you decide to avoid investors?

Pontius: We bootstrapped the company because we had advisers out of the gate who we could look to for advice and guidance, but financially we did it together. We’re 50/50 partners, we make all the decisions 50/50, and that was really important to both of us to know that we could do it ourselves. 

The first client in New York City we had, Union Square Ventures, really took a chance on us, and we’ll always be grateful for that. Because it was during COVID and there were a lot of brokers out there, there are a lot of designers you could choose from. And they knew we were a startup, they knew we were just trying a new concept. Not everything is going to work. We went through a lot in the early days, I feel like we have a better cadence now, but they gave us that opportunity and, from that, we were able to build on our client base.

When you’re pitching new clients, is it hard for them to get their head around the idea or are they onboard pretty quickly?

Arps: I think a lot of people get it. They’re like, “Oh this makes so much sense, why doesn’t it exist?” It’s almost like a no-brainer. It is a lot of work juggling between different business lines, and a lot of coordination. But, from a planning perspective, it just makes sense.

In the design process, aside from having two different companies working on a project, have you worked with a client on a design but the space was completely wrong for what they wanted?

Arps: Yeah, because you don’t know what you don’t know. And you don’t know until you’re in the space, but by then it might be too late. Part of my job as a designer is to advise clients on what they might need, do an informational interview about how they work, and suggest layouts and schemes that will support that. Design is very creative but it’s also very much technical, and I think a lot of people don’t know that.

Sarah, you worked at WeWork during the initial public offering process. What was it like there?

Pontius: I’m grateful for my time at WeWork, because it gave me the opportunity to meet Wendy Silverstein [WeWork’s chief investment officer], and I genuinely wouldn’t be where I am today if it wasn’t for Wendy. And I wouldn’t have had the courage to start my own company. It was a wild year, but I think it also was a good learning experience. It really shows that experience matters. Understanding governance matters. Understanding being a fiduciary to your investors matters and what it means. I also met a lot of people that weren’t in the real estate industry, so it opened me up to thinking about a lot of different ideas and thinking more creatively.

But I looked around and thought: If they can do this, I could do something where I was able to build a company that I was proud of, a culture that I’m proud of.

Nicholas Rizzi can be reached at nrizzi@commercialobserver.com