Ahead of Zagreb Digital Nomad Week 2021, which starts on Monday, we continue our look at Zagreb innovators from the co-working scene to get their perspectives on the current situation and future possibilies. One of the early movers and shakers came all the way from Mexico. Hermes Arriaga has had quite an impact as co-founder of the first co-working space in Croatia, Impact Hub Zagreb, way back in 2013.
1. Let’s start with the obvious question. From Mexico to Zagreb – how and why?
I first came to Croatia in 2004, to visit my girlfriend back then. In 2006 I also came shortly for a small summer activity building the basis of a primary school building in Vukovar with my friend and other volunteers. I returned once more in 2008 where I spent around 8 months on Murter Island typing my MSc thesis while my girlfriend was doing an internship. The final visit was in 2009 when we moved from The Netherlands, after we both finished our Masters degrees. I decided to stay because of the potential in social and economic development I saw the country was going through pre-accession to EU.
2. Impact Hub was a very early mover in the coworking and community building scene. When did you start, and how would you describe the journey so far?
We knew about the concept back in 2008 when we were in The Netherlands, but it was only in 2010 that a group of 6 crazy persons (5 Croatians and this Mexican) joined as the funding team. Two years later we opened up in January 2013 as the first ever coworking space in Croatia with the pupose of social impact in mind.
The process of pre-opening was not easy since we were doing a lot of community building, we started with almost no funding capital and an idea which was not proven. The first 2-3 years were critical, a lot of iteration on the business model, many mistakes but also quite a lot of satisfaction, such as entrepreneurs getting high quality business support, the funding we helped them to obtain and the connections they got, were all part of the first stage of our business.
From 2016 to 2019 we consolidated the business, getting stable revenues and a better positioning in the market being recognized by organizations in the private, governmental and civil society sector as the place where change comes to work. We also started with the bigger programmatic part of our business managing, designing and developing programs of entrepreneurial education and support to different markets (social entrepreneurs, women entrepreneurs, migrant entrepreneurs and the development of skills and capabilities of youth).
The journey from October 2019, when we moved (for the 2nd time) to a bigger space (550 sqm) with more space for hosting events and other gatherings, bigger area for offices and coworking, to March last year was all going according to our growth plan. Then a pandemic started and the earth decided to shake. Take a look on our report with many info about our journey.
3. Tell us about some of your successes and failures on that journey.
Pre-pandemic, we offered an inspirational space designed for human interaction and learning. We hosted a vibrant and diverse community, and we provided meaningful and curated content of support. 70% of our members are co-founders of their project/organization. Since 2013, 126 new full time jobs have been created by Impact Hub members and only in 2018 for example, 70% of members achieved double digit revenue growth (vs previous year).
Our own business revenues were growing organically (18% growth rate the last 5 years until 2019), the space-based model with the expansion we had in the new space was very close to being self-sustainable, the programmatic area of our business with acceleration, incubation and mentoring was also growing, and a couple of small consultancy engagements where appearing on the horizon. Among other relevant data that we have until 2019, is a Net Promoter Score of 60 among our members and other people coming to the space, 81% of the members have said they accessed new clients and beneficiaries while working here and 95% of them said that most people in Impact Hub can be trusted (previous info is from yearly surveys analysed by the Social entrepreneurship Center by the University of Vienna, see our presentation about it here).
We also had big failures, like the big and juicy EU project (150K Euro value) we decided to step out of 3 years ago, after realising that its development In Croatia would have been detrimental to our positioning and financial sustainability. Or the corporate package we designed last year and totally did not fit the market. We can also mention our big focus on delivering impact, forgetting big time to communicate the successes and overall impact that we have had in many of the entrepreneurs and individuals, failing to properly build a marketing strategy around that.
4. There is a lot of buzz about the digital nomad opportunity in Croatia, especially with all the PR from the 12-month permit. How do you rate Zagreb as a DN destination. What does it do well, and what does it need to do better?
Zagreb is the best positioned of all cities in Croatia for entrepreneurs, according to, for example, the latest ranking from StartupBlink Ecosystem report. It is also high in the list on nomadlist.com. We were, I believe some of the first spaces in Croatia to offer an special package to digital nomads, which we opened for the first time back in 2016. The package evolved in such a way that up to last year during the summer of a pandemic year being the package that helped us to pay our space costs during July and August when we had more than 60 % of our members from that package, they stay for a shorter time (less than 3 months), are digitally connected workers from other countries traveling alone of in pairs.
We added extra support helping them find affordable spaces, we connected them with the locals and helped them answer their basic questions they had from MUP. However, there is no clear definition of a digital nomad, apart from their need of temporary working space and reliable internet connection. Their profile is very diverse. Our business model focus on leveraging the connections around our community and that implies having some kind of roots here, with a social capital and connections that can add to the community, so we had an offer for digital nomads but they have not been in our core as members, even if they stay 12 months, the question reminds the same, their interest is not necessary to stay connected locally.
Zagreb does well for them because of the diversity of cultural and social activities the city offers, because of how safe and reliable certain basic services are, from drinkable water from any tap to good public transpor. Sure, it can still do better with the bureaucratic process and ease of registering a company, or giving access to short term credit to non-Croatians and making a visit to the doctor more affordable if you don’t have social security/insurance from the government.
5. One message that was clear from the Dubrovnik Digital Nomads-in-Residence program was the need to build community. As an observer, I think building community and providing local education of the opportunity are key. How would you assess the DN community currently, and can you give us 3 quick wins on how Zagreb can strengthen it?
As one of the main entities in Croatia doing proper community building ;), we believe it is all about setting the right conditions for communities to thrive. There is no such thing as managing a community, it is far better to enable a community, build the right container where fertile ground is ready for them to grow. Strong and resilient communities by the way are always small in size, their links are nurtured by practices and daily activities. At Impact Hub we have a value-based community where people also contribute on shaping and building this community.
This happens with time and not overnight, everybody needs a reliable social capital and connections to grow. We have experienced and will be experiencing that with our new business iteration to be released after the summer. Three things that can help are: 1. Be sincere about building a community 2. Practice a lot and be consistent on the terms, responsibilities and roles of everyone in the community and 3. There are no shortcuts 😉 Read More
6. You are taking part in Zagreb Digital Nomad Week 2021. Tell us about your involvement, and how important you see the event to develop Zagreb’s visibility in the DN community.
We need more events telling people about the collaboration that is happening among key ecosystem stakeholders, co-creation and collaboration are 2 words in the core of what we do (as stated back in 2016 by an article about the Future of work) an it is very nice to see this happening. Impact Hub will be offering free co-working throughout the week, and I will be taking part in a panel on the Friday, entitled DNA Croatia, Policy and Connecting to a Global Community.
7. You were certainly a pioneer all those years ago. What is your view of the startup scene, particularly with a view to collaboration and cooperation?
Cooperation is now happening, but not yet at the level needed. What is needed is more collaboration, but unfortunately many organizations do not understand the real meaning of it and think in transactional terms. We have been able to thrive as a small enterprise because of the collaborations and partnerships with a few but important key stakeholders in the startup scene. I think things are changing and I see a bright future.
8. Zagreb was very different when you moved here, but you were once a newcomer to the city. What Zagreb-specific advice do you have for nomads arriving in the city?
Be open. Try to connect locally from day one and make mistakes. This is a small city and you can get to know a lot of people by listening with attention while speaking with intention.
9. And finally, sell Zagreb to potential DN visitors in a paragraph.
Treat Zagreb as you would like to treat your hometown. Connect with the intention of making a positive impact, be mindful of the cultural differences and do not worry about the local mindset. If you do good the rest will give back… eventually.
You can learn more about the activities of Impact Hub Zagreb on the official website.
To register for free (both online and in person) for the Future of Work day on Friday June 25, register on the Saltwater Nomads website.
For more details of Zagreb Digital Nomad Week, click here.
For the latest news and features from the digital nomad scene in Croatia, follow the dedicated TCN section.