Month / March 2003

by Joel Spolsky

Finding an Office in New York City

This may be, possibly, the most off-topic article I’ve ever done here. But I try to write only about things I know about, and, recently, I learned a lot more about commercial real estate than I ever imagined I would need to know.


Old Fog Creek Office, E. 31 st.My company, Fog Creek Software, is relocating. There’s nothing wrong with the brownstone we’re in, it’s just a tiringly long commute. Basically, we’re moving because of William Whyte‘s rule: virtually all corporate relocations involve a move to a location which is closer to the CEO’s home than the old location. Whyte discovered this principle after an extensive study of Fortune 500 companies that left New York City for the suburbs in the 1950s and 1960s. They always had big, complicated Relocation Committees which carefully studied all the options and chose, coincidentally I’m sure, to move to within half a mile of the CEO’s home in Danbury, Connecticut. Whyte also showed that these companies all tanked after the relocation. With, I believe, but one exception, companies that left New York City to be closer to the CEO’s house in Connecticut or Westchester had dismal stock performance compared to companies that stayed in Manhattan.

The dismal stock performance probably came from the fact that when you relocate more than a couple of miles, some employees’ lives would be too disrupted to make the move, so you lose a lot of employees, and all the institutional knowledge, skill, and experience that comes with those employees. While I was working at Viacom one of their companies, Blockbuster, decided to move from Florida to Texas after they hired a new CEO who lived in — Texas! What a coincidence! Only a small portion of the employees made the move. For years and years the business press watched agog as Blockbuster made mistake after inexcusable mistake, re-trying all kinds of ideas that had failed only two years earlier.

But I digress. We’re not losing any employees and we’re just moving across town, to a location that is an easy walk from every subway line in NYC and three mega commuter hubs, bringing us within easy commuting distance for 17,000,000 potential employees.

Temporary Space and Incubators

Step one in finding an office in New York: allow nine months. I am not kidding about this. It will take about two months to find the space, a month to negotiate, two months to sign the lease, a month for your architect to design the build out and three months for construction. If you run out of time on your old lease, chances are (look closely) you have a clause in there which doubles or triples your rent if you stay past the end. This is called the overhang and next time you negotiate a lease, you’ll remember to negotiate a lower overhang.

Nine months. You may think you can shorten that by taking pre-built space. The problem: there’s hardly anything pre-built in the office market in New York. Almost everything you see is going to be either completely raw, or it’s going to be a weird warren of dark rabbit offices with inexplicable bars between certain rooms, filthy carpet, and disgusting yellow-stained acoustic tiles.

What there is, if you have to move tomorrow, is temporary executive suites. These are the things you see advertised in the newspaper that say “Move Tomorrow! Plans from $100 a month!” What the ad doesn’t say is that the $100 a month is for a mailbox only, with everything else a la carte. If you really want an office in one of these executive suites you’re going to pay through the nose: about five to ten times as much as comparable office space. It’s like living in a hotel instead of living in an apartment, or flying Concorde to London. Yeah, it’s convenient, but is it really $10,000 a month convenient? Still, all the executive suites in the city are full, usually an honor roll of venture-capital backed companies working hard on keeping their cash burn up to respectable levels to impress the investors. This is because normal landlords hate venture capital funded companies. The few landlords in New York that rented to VC startups during the dotcom boom have learned never to do that again. Here’s why: venture funded companies only have enough cash to last a few months or at most a year, after which they have to raise another round. If they don’t raise the round, they close. Probably 80% of these companies close within a year. The way most leases are written, a landlord literally loses money if the tenant leaves after a year. If you’re venture funded, and your VC won’t sign a five year lease for you, you may be stuck paying the Rich Tax, paying $200 per foot (per year) to be in executive suites when the market rent is $20 – $30.

Another option is the so-called incubators. In New York City, we have TechSpace, EEmerge, Kickstart, and probably a few others. I am sort of surprised these places survived the dotcom bust, but they did, and they’ve lost their arrogance. They no longer act like VCs, they don’t care about your business plan any more, and they don’t want 5% of your pathetic worthless stock, they just want to get paid. They won’t even kick you out after 3 months any more.

Incubators are a terrible place for programmers, because they took the baby chick metaphor a bit too far. The scientific geniuses that built these places actually think that the closer you shove people together the warmer they will be and thus the faster they will grow. What you get at the incubators is a room the size of your bedroom with desks around the outer wall where you can cram 16 people, all for about three thousand bucks a month. Oh, you wanted a window? Make it four thousand. Incubators are a smidgen cheaper, per square foot, than the executive office space, but they are just not an acceptable long-term solution.

Normal Office Space

A quick survey of normal office space.

First, it’s usually not built, and if it is, somebody has probably been using it. If the walls are configured to your liking, you may be able to paint and recarpet it (about $7 per square foot) and move in. Otherwise you’re going to have to do construction. Plan on this costing $50 per square foot. So if it’s a 3000 square foot office, expect to spend $150,000 on the construction. I know, this sounds like a lot. While you are looking for offices, brokers will tell you that you can construct an office for less than $50 a square foot. They are lying to make the deal. Do not fall for it. The only way to pay less is if a lot of the work is already done (on our office, the demolition, ceiling, sprinklers, air conditioner, bathrooms, and finished floors were all done, so we’re hoping to spend $25/ft on construction.)

Update, Feb. 2006: Construction costs are up a lot in the city. Plan on $75/sq ft for a very minimal buildout. I’m serious. We did construction for about $30 in 2003, but that was with an incompetant contractor who did terrible work, took forever, and lost his shirt on the deal because he had underbid.

In today’s market, you can usually get the landlord to pay for some of this, probably $10 to $25 a foot. They will want receipts and stuff and they will only want to pay for walls and air conditioning ducts, not Aerons and plasma TV screens. Some landlords will also offer to do the construction themselves for you. If you take them up on it, you’ll get the cheapest possible construction and it won’t be very nicely designed, so you may be better off hiring your own architect and contractor.

In the office space market in the US, offices are categorized as Class A, B, or C. Class A means new, top-of-the-line construction. In New York, that means one thing only: modern steel and glass high rises. Anything else is not Class A. A classic old skyscraper from 1913 designed by Cass Gilbert with incredible detailing, beautiful gargoyles, a complete renovation from top to bottom and everything is spotless and new is still not a Class A building, even if it’s nicer than most Class A buildings.

42d Street

Class B and Class C don’t mean anything, there’s no formal definition, so nobody bothers to use these terms in the city any more. There’s Class A and there’s Everything Else.

For the purposes of high tech startups, unless you need a whole floor of a skyscraper, forget about Class A. It’s not that you can’t afford it, it’s that they are not going to subdivide floors for you. These buildings are leased 10 floors at a time.

That leaves you with a wide variety of old buildings, often loft buildings, in various stages of renovation. The best ones have been recently renovated, the elevators are new, everything is spick-and-span and the lobby is nice if not glorious. The worst ones have a spanish deli as the lobby, the (one) elevator is manual and operated by a scary old man, and there are still a lot of clothing factories in the building operating heavy machinery that goes bonk bonk bonk all day long. Almost all of these buildings are family owned, although they might be managed by one of the large real estate management companies like Newmark or GVA Williams.

What If I Really, Really Don’t Want to Build?

There are a few buildings which cater to small tenants where the offices are basically built out and at most you’ll need paint and carpet. The Graybar Building near Grand Central, the Fisk Building near Columbus Circle, and the hugely unpopular Empire State Building. Graybar and Fisk always have spaces available on short notice at “market rents,” about 50% – 100% more than you’ll pay for raw space in the Garment District or Wall Street but reasonable for their neighborhoods. Graybar is a funny ghost town building, right on top of Grand Central; it’s full of offices of just-retired lawyers who live in Connecticut and can’t quite let go, so they keep an office in the Graybar building, but then they never really go there.

Do You Need A Broker?

In the commercial market, brokers are paid by the landlord. Usually something like 6% of the total value of the lease over its entire term. This is a lot of money for a little bit of work. So as soon as you let it be known that you are looking for office space, you will have brokers falling all over you.

You have the option of using a tenant’s broker. A good tenant’s broker does all the legwork for you, looking at lots of spaces to find one and then showing you only the best options to choose from. The trouble is, there are hardly any good tenant’s brokers. Most of them are just too lazy. The will tell you to meet them at Starbucks at 10:00 am, and they’ll bring a printout they made at 9:45 that you could have gotten online (more about that in a moment), and they’ll make you walk around with them while they get their act together and discover that these spaces don’t really exist.

Tenant’s brokers will tell you that they have the inside track on office space that isn’t listed, especially sublets. The best ones will, but only the very best ones. Most of them are just making the same printouts you can get yourself.

Bottom line: you don’t really need a tenant’s broker to show you spaces. OK, the other thing the tenant’s brokers will tell you is that they represent you, not the landlord, so they will have your interests in mind. This is vaguely true, but they’re still getting paid by the landlord, and they still make more money if you overpay, so it’s hard to trust them. If you’re worried about landlord sharks taking advantage of you, stop worrying about that. Why? Because you’ll have a good lawyer on your side when you sign the lease. You need a lawyer to review your lease anyway, that’s your real protection from the landlord, not a broker who gets paid by landlords.

The Plaza HotelAre there disadvantages to having a tenant’s broker? There are two. First, you may have to sign an exclusive. In today’s market, with vacancies skyrocketing and no new tenants, you should flatly refuse. There’s no reason to sign an exclusive. Just promise the broker that if you take a space which they showed you first, you will see to it that they get their commission.

The other disadvantage is that if a tenant’s broker finds you a space and you take it, they will be splitting the commission between the tenant’s broker and the landlord’s broker. That means the landlord’s broker only gets half the commission. That means, all else being equal, that the landlord’s broker would rather do those deals where they get the whole commission, when they have a choice. That means that if you’re competing for space with another potential tenant, and that tenant has his own broker and you don’t, then the landlord’s broker is going to like you much more… twice as much, in fact. Although theoretically it’s up to the owner of the building to decide whom to rent to, you can bet that the landlord’s broker will find ways to make the owner like you more.

Update, Feb. 2006: I’ve been told that many landlord’s brokers are salaried employees on the staff of the building management company who couldn’t care less and don’t really work on commission. So for larger space (10,000 square feet or more) it probably won’t hurt to hire a good tenant’s broker and sign a three-month exclusive, but make sure you’ve got a really good broker who will do the footwork to earn their commission.

How Do I Find a Space Without a Broker?

Easy as pie.

First, do searches on two websites, which overlap some but not entirely in their listings: CityFeet and MrOfficeSpace.

Next, check the Sunday New York Times. (Not online. The online version just redirects you to CityFeet, which has a superset of the print classifieds). Circle everything that looks appropriate.

If you want cheaper, artsy space, check the Village Voice.

Avoid two things: ads that sound like executive office spaces, and ads that are just pitches for brokers disguised as listings. You can identify these because they don’t give any details about the space, like the address. If the address is not in the listing, don’t bother responding, it’s almost certainly a broker who is fishing for potential tenants. He’ll tell you to meet him at Starbucks at 10:00 am where he’ll show up with exactly the same list you printed out from MrOfficeSpace.

Next step: do not call the broker in the listing. Yes, they can show you the space, but you don’t need them yet. First go to the building in the listing and see if you like the building. Check out the lobby. Read the list of tenants to see if they’re mostly software companies, architects, and graphic designers, or if they’re mostly clothing factories, importers, and methadone clinics. Check out the neighborhood. In the bad buildings, people get into the elevators talking to themselves. In the good buildings, people appear to get into the elevators talking to themselves, but they have a tiny earphone, so it’s totally different, they’re just on the phone.

Like the building? Here’s the next step, for which you should be reasonably well dressed. Go into the building’s service entrance and ask to speak to the super. Tell the super you’re looking for office space and you want to see the space in his building. He will show it to you. In better buildings, he may ask for a business card. That’s all there is to it.

Now, if you like the space, call the broker.

“What would have happened,” you may ask, “if I had just called the number in the ad?” Well, nothing terrible. The broker would have met you in the building lobby, and then he would have asked to see the super, and the super would have shown you the space. You see, the super has the keys and knows how to drive that cool manual elevator that goes to the floors where the fancy automatic elevators don’t stop because there are no tenants there.

At this point, if you don’t like the space, the broker will offer to show you a zillion other spaces. If he’s smart he’ll have the MrOfficeSpace printout that you also have. It doesn’t hurt to walk around with him and look at spaces, he may know the neighborhood and be able to give you the gossip. It’s worth spending some time talking to all the brokers you meet. Ask them what buildings have nice owners, and what buildings have nasty owners. They will lie a little bit about the buildings in which they have an interest, but if you keep asking and average the results you’ll eventually learn the reputations of the landlords in the neighborhood.

How Do I Know If I Like The Space?

I kept looking at spaces, not particularly knowing if I liked anything or not, and one nice broker said to me: “Don’t worry. When you find the right place for you, you’ll know it.” And he was right. The next day I walked into a place that was beautiful: natural light on three sides, a great renovated building, beautiful new wood floors; instead of taking notes I just wrote “incredibobble” in my notebook. That’s the place you want. If it doesn’t happen keep looking.

Gotchas to watch out for:

  • If there are windows, figure out what might happen that would block your views. If the building is next to an empty lot or a “taxpayer” (one story building), as soon as the economy gets better, a building might go up there and it might block your view.
  • Picture of a toilet.Check out the bathrooms. Some buildings have really gross bathrooms and people forget to look at them.
  • Sit quietly in the space for a few minutes and listen to all the noises. Are there factories nearby? Noisy people upstairs banging around? A noise you don’t notice when you’re walking around talking to a broker may be torture when you’re trying to concentrate on writing code.
  • Make sure the building has 24/7 access. Some buildings in New York actually close.
  • How are you going to get air conditioning? Is there something in place or will you have to install it? When you install it will it block your only window?
  • Are there enough elevators? Older buildings with only one or two elevators can mean really long, irritating waits.

How Big A Space Do I Need?

Space is measured in RSF: rentable square feet. This is a number that bears only a fleeting relationship to the actual size of the space. I have seen spaces that are 1000 RSF which are the same size as spaces that are 3000 RSF.

How could this be, you ask?

Well, you don’t want to know. Officially you get RSF by taking the total size of the space and multiplying it by the building’s loss factor. That’s a made up number which they multiply the size of the space by, just because they can get away with it. It’s supposed to account for all the shared areas, like the basement, the elevator shafts (counted once for each floor of course), the exterior walls, the interior walls, the bathrooms, the lobby, the Starbucks next to the lobby, the staircases, the fire escapes, and the owner’s house in Queens including pool and garden.

Meaning — RSF is pretty useless. When they quote a price, it will always be quoted in dollars per square foot per year. Multiply by the size and divide by 12 to get your monthly rent, and this is the only figure you care about. Sign a lease based on the cost, not the square feet, or they’ll “recalculate” their loss factor the next year and raise your rent.

This makes it sort of hard to search for office space, and it’s one reason you have to look at lots of spaces (and bring a tape measure.) If you calculated that you’re going to need about 2000 square feet, look for places advertised between 1000 and 3000.

Hidden Charges

Find out about all the charges you’re going to have to pay. There are a couple of ways New York buildings especially like to stick it to you.

Some buildings don’t have separate electric meters for each space. Since they don’t know how much electricity you’re using, they just have to charge you based on the assumption that you are operating a 100,000 watt radio station with Times Square lighting. They’ll charge you something like $3 per square foot per year which is way more than you would spend if you had your own meter.

Some buildings make up things and put them in the lease. “Tenant shall pay $200 per month to maintain the decorative steel trim on the building,” my lease said. Hmm. Damn building doesn’t even have a steel trim. I made them take it out.

Escalations are another big issue. If the rent is x for the first year, it’s going to be x times the escalation in the second year, and so on. This amount should be agreed upon and not based on some weird fabricated thing like “tenant’s prorated share of the owner’s increased expenses from operating the building.” I don’t care about the owner’s expenses and I’m not paying for the owner to pass along the cost of his 2003 Buick LeSabre to me. Some buildings have a uniquely Manhattan corruption called “Porter’s Wage.” This means that every year, when they renegotiate the contract with the Porter’s Union, the percentage that those salaries goes up by is the percentage escalation that the tenants pay in rent. The theory was that a porter’s wage was correlated with the overall inflation in the cost of operating a building, but in reality buildings don’t have porters any more, and for some reason the porters they don’t have would get really huge salaries, if they had jobs, but they don’t, and the tenants are still paying for it.

Another thing the landlord will want to pass on to you is your share of the increase in property taxes. This is reasonably standard. They will even bill you for any money they spent “lobbying” (paying bribes) to get their property taxes reduced. Slimy but common.

How Do I Negotiate The Lease?

Theoretically, everything is negotiable. Practically, you’re going to negotiate these big items:

  • monthly rent.
  • months of free rent at the beginning (these days it’s not uncommon to get one month for each year of the lease, and even a couple more months while construction is going on)
  • landlord’s contribution to buildout
  • length of the lease

For the purpose of negotiations, there are a few things you can pretend to care about which you can later swap to get a better deal:

  • pretend that you want 100% of the profit from a sublet. They won’t give it to you, they’ll give you 50%, which is actually better for you because it gives them an incentive to allow the sublet in the first place, and you can swap this for something else.
  • pretend that you don’t want to pay a security deposit.
  • pretend that you want zero overhang, so your rent doesn’t go up if you overstay your lease.

You may think you want to sign as short a lease as possible, because it “leaves your options open.” Actually you’re probably better off with a longer lease, for lots of reasons.

  • Landlords like long leases, so they’ll like you more if you sign a long lease, and you can get a better deal.
  • Rents are super low now. If rents go up, your lease becomes worth cash money.
  • If you grow out of the space, the landlord will let you out of the lease if you take another space elsewhere from the same landlord.
  • If you go bankrupt or close, the landlord is not really going to be able to get anything out of you. If you’re incorporated and the corporation signs the lease, you’re not personally liable. At worst, the landlord will ask the company’s officers to personally sign a good guy guarantee. This says that you will be personally responsible for the rent but only until the premises are vacated.
  • If you need less space, you can probably sublet. You might lose some money on the sublet but you’ll probably make money. The landlord will help himself to half of your net profits from subletting.
  • You’ll get more free months at the beginning with a longer lease.
  • You’ll be able to negotiate more money for construction with a longer lease.
  • The broker will get more money, so he’ll be more eager to make the deal happen.

All in all, there’s no reason to be unduly scared of long leases. You can start by asking for a three or five year lease, agree on the months of free rent and construction money, and then ask them how much more free rent and money they’ll give you if you take a seven year lease. (Logically, this should be proportional — doubling the length of the lease should double the free stuff).

There are thousands of good books on negotiating in general and even a bunch of books on negotiating leases. Read two or three if you’ve never done this before. Never, ever go into negotiations unless you have a good alternative. You should have two or three options you like and want before you try to negotiate.

After you negotiate the big items, get a proposed lease from the landlord and let your lawyer negotiate all the little details to his lawyerly heart’s content.

Do I Need a Lawyer?

Untitled by Steven Harvey, Oil on LinenAbsolutely. First of all, the errors-and-omissions insurance you carry (you do have errors and omissions insurance, right?) requires you to have a lawyer review any contracts you sign. But it’s a great idea anyway.

I found a lawyer who works for another landlord. He spends most of his days in court trying to evict tenants. I thought he would be perfect to protect me from the likes of — him. And he was. As he was reading through a lease, he said to me, “OK, this paragraph, I really like this clause, I think I’m going to steal it and use it in my own contracts.” Pause. He reaches for a red pen and crosses out the paragraph. “But you’re not signing it.” This guy was great. He knew that the standard phrase in the lease where it talks about leaving the space in “broom clean condition” was a classic way to avoid returning the deposit. “Sure, it was clean,” the owner says, “but it wasn’t broom clean. Prove to me that it was broom clean.” We crossed out “broom” and wrote “reasonably.” You Need A Good Lawyer For This.

Here’s another reason you need a lawyer. The lawyer can say to the landlord, “Whaddaya mean if we’re 3 days late on the rent we get evicted? We want the right to be 15 days late!” When your lawyer says this, no offense is taken. He’s just the lawyer. But if you, the tenant, try to say it, the landlord will say, “What, are you planning to be late on the rent?”

Oh, It’s All Too Hard!

Our new officeI know. I know. And it has nothing to do with writing software. But as soon as you sign the lease, you can hire an architect and start talking about the fun stuff, like where the pool table goes.

Other Links

TenantWise has a lot of great articles about all this stuff, although you have to register to read it all, it’s worth it.

Crains New York Business covers the commercial real estate beat like no other publication. Read it for a few months before you need office space, especially pay attention to the boring stories about deals, so you know what the market is like and negotiate from a position of knowledge.

Read the last few months of news at CityFeet, too.

Discuss your experience on the Joel on Software New Yorker’s Forum.

by Joel Spolsky

2003/03/28

Basically, we’re moving because of William Whyte’s rule: virtually all corporate relocations involve a move to a location which is closer to the CEO’s home than the old location. Whyte discovered this principle after an extensive study of Fortune 500 companies that left New York City for the suburbs in the 1950s and 1960s. They always had big, complicated Relocation Committees which carefully studied all the options and chose, coincidentally I’m sure, to move to within half a mile of the CEO’s home in Danbury, Connecticut. Whyte also showed that these companies all tanked after the relocation.

This may be, possibly, the most off-topic article I’ve ever done here. But I try to write only about things I know about, and, recently, I learned a lot more about commercial real estate than I ever imagined I would need to know…

Oh, good, TechInterview is back!

by Joel Spolsky

2003/03/26

Not bad: about four hours of work to implement a picture editor with crop, resize, rotate, undo, and save.

It did take about four hours yesterday to figure out which OCX/DLL files I need to ship and make sure that SETUP included them, and I spent an hour last night reading the documentation to get a better idea for what I have to do.

by Joel Spolsky

2003/03/24

A couple of the monthly columns I’ve been doing for the Programmer’s Paradise catalog are now on the web: a review of VMWare and a column on data modeling with ERwin. Coming up: a five minute introduction to user interface design, and a look at my experience using the profiler in CompuWare’s DevPartner Studio to speed up CityDesk.

750 words doesn’t give me much of a chance to really review things in depth, but I do have a policy for writing reviews: I only review products that I actually want to use in my daily work at Fog Creek. Unlike trade magazine reviewers, I still spend about 50% of my time doing software development, and I’m happy to try the latest toys if I think they will help. For example, this week I’m going to try to implement a basic image editor into CityDesk using LeadTools.

In other news, we have signed the lease for our new office space, and the architect came up with a groovy floorplan with parallelogram offices.

by Joel Spolsky

2003/03/14

AngryCoder: “FogBUGZ is very well designed, and virtually bug free. Frankly, if you are in the market for a defect tracking solution, you can’t do much better than FogBUGZ. It is by far the best solution on the market right now, and is also very attractively priced.” Thanks!

Joseph Jones, who wrote the review, didn’t like the perceived lack of customizability in FogBUGZ. I hear ya. This was one of those agonizing decisions for us. It’s a tradeoff between implementing features that make the sale, versus implementing features that, we think, will make people who use our software love it, which helps in the long term. At the time it was discussed in depth here on Joel on Software.

Take, for example, a typical report a bug tracking package gives you that shows you the number of bugs generated per day per programmer. Typical bad managers will use that tool to punish programmers with high bug counts or reward programmers with low bug counts. As a result, every time a tester tries to enter a bug, the programmer will argue about it. “That’s not really a bug.” “Please don’t enter it, I’ll fix it on the side for you.” Eventually the bug tracking system subverts itself. That’s not FogBUGZ’s fault, but there you have it. Nobody wants to use it, they never upgrade, they don’t buy more licenses when they get more programmers, and we lose the potential word of mouth.

The current system, in which we expect FogBUGZ users to have enlightened development processes, makes us miss out on initial sales but it makes our existing customers happier. And they tell friends, and they buy more and more licences, and all is good. We’ve found that anyone who has been using FogBUGZ and moves on to a new job that doesn’t have bug tracking will recommend FogBUGZ at their new job, which is one reason our sales are up by about 200% since last year.

But this is all, to some extent, speculation. I can’t prove anything here. Design decisions are hard that way.

by Joel Spolsky

2003/03/07

I just got back from inspecting the new Fog Creek Office, a sunny loft in the shmatta district, with the architect. It’s going to make a really nice office when we’re finished building it out, with private offices, a living room area, kitchenette, and, budget permitting, a pool table and plasma TV. Here’s what I told the architect:

  • private windowed offices are non-negotiable
  • we need three times as many power outlets as anyone would think. I’m sick of power strips. I have ten things plugged in right at my desk. I specified 4 outlets every foot, is that absurd?
  • I want to be able to pull my own lan, telephone, fiber, and cable TV wires. Even if they’re exposed.

New Fog Creek office

 

by Joel Spolsky

Building Communities with Software

The social scientist Ray Oldenburg talks about how humans need a third place, besides work and home, to meet with friends, have a beer, discuss the events of the day, and enjoy some human interaction. Coffee shops, bars, hair salons, beer gardens, pool halls, clubs, and other hangouts are as vital as factories, schools and apartments [“The Great Good Place”, 1989]. But capitalist society has been eroding those third places, and society is left impoverished. In “Bowling Alone,” Robert Putnam brings forth, in riveting and well-documented detail, reams of evidence that American society has all but lost its third places. Over the last 25 years, Americans “belong to fewer organizations that meet, know our neighbors less, meet with friends less frequently, and even socialize with our families less often.” [2000] For too many people, life consists of going to work, then going home and watching TV. Work-TV-Sleep-Work-TV-Sleep. It seems to me that the phenomenon is far more acute among software developers, especially in places like Silicon Valley and the suburbs of Seattle. People graduate from college, move across country to a new place where they don’t know anyone, and end up working 12 hour days basically out of loneliness.

So it’s no surprise that so many programmers, desperate for a little human contact, flock to online communities – chat rooms, discussion forums, open source projects, and Ultima Online. In creating community software, we are, to some extent, trying to create a third place. And like any other architecture project, the design decisions we make are crucial. Make a bar too loud, and people won’t be able to have conversations. That makes for a very different kind of place than a coffee shop. Make a coffee shop without very many chairs, as Starbucks does, and people will carry their coffee back to their lonely rooms, instead of staying around and socializing like they do in the fantasy TV coffeehouse of “Friends,” a program we watch because an ersatz third place is less painful than none at all.

In software, as in architecture, design decisions are just as important to the type of community that develops or fails to develop. When you make something easy, people do it more often. When you make something hard, people do it less often. In this way you can gently encourage people to behave in certain ways which determine the character and quality of the community. Will it feel friendly? Is there thick conversation, a European salon full of intellectuals with interesting ideas? Or is the place deserted, with a few dirty advertising leaflets lying around on the floor that nobody has bothered to pick up?

Look at a few online communities and you’ll instantly notice the different social atmosphere. Look more closely, and you’ll see this variation is most often a byproduct of software design decisions.

On Usenet, threads last for months and months and go off onto so many tangents that you never know where they’ve been. Whenever a newbie stumbles by and asks a germane question, the old timers shout him down and tell him to read the FAQ. Quoting, with the “>” symbol, is a disease that makes it impossible to read any single thread without boring yourself to death by re-reading the whole history of a chain of argument which you just read in the original, seconds ago, again and again and again. Shlemiel the Painter reading.

On IRC, you can’t own your nickname and you can’t own a channel — once the last person leaves a room, anyone can take it over. That’s the way the software works. The social result was that it was often impossible to find your friends when you came back the next day, because someone else might have locked you out of your chatroom and your friends might have been forced to choose different nicknames. The only way to prevent gay bashers in Perth, Australia from taking over gay chat channels when the boys went to sleep was to create a software robot to hang around 24 hours a day and guard the channel. Many IRC participants put more effort into complicated bot-wars, attempts to take over channels, and general tomfoolery than actually having a conversation, often ruining things for the rest of us.

On most investment discussion boards, it’s practically impossible to follow a thread from beginning to end, because every post is its own page, which makes for a lot of banner ad inventory, but the latency in reading a conversation will eventually drive you nuts. The huge amount of flashing commercial crap on all four sides of the conversation makes you feel like you were trying to make friends in Times Square, but the neon lights keep demanding all the attention.

On Slashdot, every thread has hundreds of replies, many of which are identical, so the conversation there feels insipid and stupid. In a moment I’ll reveal why Slashdot has so many identical replies and the Joel on Software forum doesn’t.

And on FuckedCompany.com, the discussion board is completely, utterly worthless; the vast majority of posts consist of irrelevant profanity and general abusiveness and it feels like a fraternity rudeness contest, without any fraternity.

So, we have discovered the primary axiom of online communities:

Small software implementation details result in big differences in the way the community develops, behaves, and feels.

IRC users organize themselves around bot warfare because the software doesn’t let you reserve a channel. Usenet threads are massively redundant because the original Usenet reader, “rn,” designed for 300 baud modems, never shows you old posts, only new ones, so if you want to nitpick about something someone said, you had to quote them or your nitpick won’t make sense.

With that in mind, I’d like to answer the most common questions about the Joel on Software forum, why it was designed the way it was designed, how that makes it work, and how it could be improved.

Q. Why is the software so dang simplistic?

A. In the early days of the Joel on Software forum, achieving a critical mass to get the conversation off the ground was important to prevent the empty restaurant phenomenon (nobody goes into an empty restaurant, they’ll always go into the full one next door even if it’s totally rubbish.) Thus a design goal was to eliminate impediments to posting. That’s why there’s no registration and there are literally no features, so there’s nothing to learn.

The business goal of the software that runs the forum was to provide tech support for Fog Creek’s products. That’s what paid for the development. To achieve that goal, nothing was more important than making the software super simple so that anyone could be comfortable using it. Everything about how the forum works is incredibly obvious. I don’t know of anyone who hasn’t been able to figure out how to use it immediately.

Q. Could you make a feature where I check a box that says “email me if somebody replies to my post?”

A. This one feature, so easy to implement and thus so tempting to programmers, is the best way to kill dead any young forum. Implement this feature and you may never get to critical mass. Philip Greenspun’s LUSENET has this feature and you can watch it sapping the life out of young discussion groups.

Why?

What happens is that people go to the group to ask a question. If you offer the “notify me” checkbox, these people will post their question, check the box, and never come back. They’ll just read the replies in their mailbox. The end.

If you eliminate the checkbox, people are left with no choice but to check back every once in a while. And while they’re checking back, they might read another post which looks interesting. And they might have something to contribute to that post. And in the critical early days when you’re trying to get the discussion group to take off, you’ve increased the “stickiness” and you’ve got more people hanging around, which helps achieve critical mass a lot quicker.

Q. OK, but can’t you at least have branching? If someone gets off on a tangent, that should be its own branch which you can follow or go back to the main branch.

A. Branching is very logical to a programmer’s mind but it doesn’t correspond to the way conversations take place in the real world. Branched discussions are disjointed to follow and distracting. You know what I find distracting? When I’m trying to do something on my bank’s web site and the site is so slow I can’t remember what I’m doing from one click to the next. That reminds me of a joke. Three old ladies talking. Lady 1: “I’m so forgetful the other day I was on the steps to my apartment with a bag, and I couldn’t remember if I was taking out the trash or going upstairs with the groceries.” Lady 2: “I’m so forgetful I was in my car in the driveway and I couldn’t remember if I was coming home or going to shul.” Lady 3: “Thank God, I still have my memory, clear as a bell, knock on wood. (knock knock knock). Come in, door’s open!” Branching makes discussions get off track, and reading a thread that is branched is discombobulating and unnatural. Better to force people to start a new topic if they want to get off topic. Which reminds me…

Q. Your list of topics is sorted wrong. It should put the topic with the most recent reply first, rather than listing them based on the time of the original post.

A. It could do that; that’s what many web-based forums do. But when you do that certain topics tend to float near the top forever, because people will be willing to argue about H1B visas, or what’s wrong with Computer Science in college, until the end of the universe. Every day 100 new people arrive in the forum for the first time, and they start at the top of the list, and they dive into that topic with gusto.

The way I do it has two advantages. One, topics rapidly go away, so conversation remains relatively interesting. Eventually people have to just stop arguing about a given point.

Two, the order of topics on the home page is stable, so it’s easier to find a topic again that you were interested in because it stays in the same place relative to its neighbors.

Q. Why don’t you have some kind of system so I can see what posts I’ve already read?

A. We have the best system that can be implemented in a distributed, scalable fashion: we let everyone’s browser keep track of it. Web browsers will change the color of the links you’ve already visited from blue to purple. So all we have to do is subtly change the URL for each topic to include the number of replies available; that way when there are additional replies the post will appear in the “unread” color again.

Anything more elaborate than this would be harder to build and would needlessly complicate the UI.

Q. The damn “reply” link is all the way at the bottom. This is a usability annoyance because you have to scroll all the way to the bottom.

A. This is intentional. I would prefer that you read all the posts before you reply, otherwise you may post something which is repetitive or which sounds disjointed coming after the previous last post. Of course, I can’t physically grab your eyeballs and move them from left to right, forcing you to read the entire thread before letting you post, but if I put a “reply” link anywhere but the bottom of the page that would positively encourage people to spew their little gems before they’ve read what’s already there. This is why Slashdot topics have 500 replies but only 17 interesting replies, and it’s why nobody likes to read Slashdot discussions: they sound like a classroom full of children all shouting out the same answer at the same time. (“ha ha … Bill Gates! That’s an oxymoron!”)

Q. The damn “Start a New Topic” link is all the way at the bottom…

A. Uh huh, same thing.

Q. Why don’t you show people their posts to confirm them before you post them? Then people wouldn’t make mistakes and typos.

A. Empirically, that is not true. Not only is it not true, it’s the opposite of true.

Part one: when you have a confirmation step, most people just click past it. Very few people reread their post carefully. If they wanted to reread their post carefully, they could have done it while they were editing it, but they are bored by their post already, it’s yesterday’s newspaper, they are ready to move on.

Part two: the lack of the confirmation step actually makes people more cautious. It’s like those studies they did that showed that it’s safer, on twisty mountain roads, to remove the crash barrier, because it makes people scared and so they drive more carefully, and any way, that little flimsy aluminum crash barrier ain’t gonna stop a 2 ton SUV moving at 50 mph from flying off the cliff. You’re better off, statistically, just scaring the bejesus out of drivers so they creep along at 2 miles per hour around the hairpins.

Q. Why don’t you show me the post I’m replying to, while I compose my reply?

A. Because that will tempt you to quote a part of it in your own reply. Anything I can do to reduce the amount of quoting will increase the fluidity of the conversation, making topics interesting to read. Whenever someone quotes something from above, the person who reads the topic has to read the same thing twice in a row, which is pointless and automatically guaranteed to be boring.

Sometimes people still try to quote things, usually because they are replying to something from three posts ago, or because they’re mindlessly nitpicking and they need to rebut 12 separate points. These are not bad people, they’re just programmers, and programming requires you to dot every i and cross every t, so you get into a frame of mind where you can’t leave any argument unanswered any more than you would ignore an error from your compiler. But I’ll be damned if I make it EASY on you. I’m almost tempted to try to find a way to show posts as images so you can’t cut and paste them. If you really need to reply to something from three posts ago, kindly take a moment to compose a decent English sentence (“When Fred said blah, he must not have considered…”), don’t litter the place with your <<<>>>s.

Q. Why do posts disappear sometimes?

A. The forum is moderated. That means that a few people have the magick powah to delete a post. If the post they delete is the first one in a thread, the thread itself appears deleted because there’s no way to get to it.

Q. But that’s censorship!

A. No, it’s picking up the garbage in the park. If we didn’t do it, the signal to noise ratio would change dramatically for the worse. People post spam and get rich schemes, people post antisemitic comments about me, people post nonsense that doesn’t make any sense. Some idealistic youngsters may imagine a totally uncensored world as one in which the free exchange of intelligent ideas raises everyone’s IQ, an idealized Oxford Debate Society or Speakers’ Corner. I am pragmatic and understand that a totally uncensored world just looks like your inbox: 80% spam, advertising, and fraud, rapidly driving away the few interesting people.

If you are looking for a place to express yourself in which there will be no moderation, my advice to you would be to (a) create a new forum and (b) make it popular. [Apologies to Larry Wall].

Q. How do you decide what to delete?

A. First of all, I remove radically off-topic posts or posts which, in my opinion, are only of interest to a very small number of people. If something is not about the same general topics as Joel on Software is about, it may be interesting as all heck to certain people but it’s not likely to interest the majority of people who came to my site to hear about software development.

My policy in the past has been that “off topic” includes any discussion of the forum itself, its design or usability. There’s a slightly different reason for this, almost another axiom. Every forum, mailing list, discussion group, and BBS will, all else being equal, lapse into conversations about the forum itself every week or two. Literally once a week somebody strolls in and announces his list of improvements to the forum software which he demands be made right away. And then somebody says, “look buddy you’re not paying for it Joel’s doing us a favor get lost.” And somebody else says “Joel’s not doing this out of the goodness of his heart it’s marketing for Fog Creek.” And it’s just SOOOO BORING because it happens EVERY WEEK. It’s like talking about the weather when you have nothing else to talk about. It may be exciting to the new person who just appeared on the board but it is only barely about software development, so, as Strong Bad says, “DELETED”. Unfortunately what I have learned is that trying to get people to stop talking about the forum is like trying to stop a river. But please, if you’re reading this article and you want to discuss it on the forum, please, please, do me a huge favor, and resist the urge.

We will delete posts which are personal, ad hominem attacks on non public personalities. I better define that. Ad hominem means it is an attack on the individual, rather than on his ideas. If you say “that is a stupid idea because…” it’s OK. If you say “you are stupid” then it’s an ad hominem attack. If it’s vicious or uncivil or libelous, I delete it. There’s one exception: because the Joel on Software forum is the best place to criticize Joel, vicious or uncivil posts about Joel are allowed to stand but only if they contain some tiny sliver of a useful argument or idea.

I automatically delete posts which comment on the spelling or grammar of a previous poster. We’ll be talking about interviews and someone will say, “It’s a wonder you can get a job with spelling like that.” It’s just super boring to talk about other people’s spelling. SUPER, SUPER boring.

Q. Why don’t you just post the rules instead of leaving it as a mystery?

A. The other day I was taking the train from the Newark Airport back to Manhattan. Besides being in general disrepair, the only thing to read was a large sign that explained very sternly and in great detail that if you misbehaved, you would be put off the train at the next stop and the police would be summoned. And I thought, 99.99999% of the people who read that sign ain’t gonna be misbehavin’, and the misbehavors couldn’t care less what the sign says. So the net result of the sign is to make honest citizens feel like they’re being accused of something, and it doesn’t deter the sociopaths at all, and it just reminds the good citizens of New Jersey endlessly that they’re in Newark, Crime Capital, where sociopaths get on the train and do Unpleasant Things and Make a Scene and have to be Put Off and the Police Summoned.

Almost everyone on the Joel on Software forum, somehow, was born with the part of the brain that tells them that it’s not civilized to post vicious personal attacks, or to post questions about learning French on a software forum, or to conduct an argument by criticizing someone’s spelling. And the other .01% don’t care about the rules. So posting rules is just a way to insult the majority of the law-abiding citizens and it doesn’t deter the morons who think their own poo smells delicious and nothing they post could possibly be against the rules.

When you address troublemakers in public, everyone else thinks you’re paranoid or feels angry at being scolded when they did nothing wrong. It’s like being in grade school again, and one idiot-child has broken a window, and now everyone has to sit there listening to the teacher giving the whole class a stern lecture on why you mustn’t break windows. So any public discussion of why a particular post got deleted, for example, is taboo.

Q. Instead of deleting posts, why don’t you have a moderation scheme, where people vote on how much they like a post, and people can choose how high the vote has to be before they read it?

A. This is, of course, how Slashdot works, and I’ll bet you 50% of the people who read Slashdot regularly have never figured it out.

There are three things I don’t like about this. One: it’s more UI complication, a feature that people need to learn how to use. Two: it creates such complicated politics that it make the Byzantine Empire look like 3rd grade school government. And three: when you read Slashdot with the filters turned up high enough that you only see the interesting posts, the narrative is completely lost. You just get a bunch of random disjointed statements with no context.

Q. Why don’t you have a registration scheme to eliminate rude posters?

A. As I explained earlier, the goal of the forum is to make it easy to post. (Remember, the software was written for tech support.) Registration schemes eliminate at least 90% of the people who might have posted, and in a tech support scenario, those 90% are going to call my toll free number.

Besides, I don’t think registration would help. If somebody is being abusive, it doesn’t help to ban them, they can trivially reregister. The idea of improving the community by requiring registration is an old one, and it’s appropriate, I think, for the Echo/Well type of conferences where you’re creating a network of people as much as you’re discussing a topic, and you charge people cash money to belong.

But requiring registration does NOT improve the quality of the conversation or the average quality of the participants. If you look closely at the signal-to-noise ratio on the Joel on Software forum, you might start to notice that the noisiest people (i.e. the people who post the most words while contributing the fewest ideas) are often the long time, hard core members who visit the forum every ten minutes. These are the people who feel the need to chime in with a “I agree with that” and replies to Every Single Topic even when they haven’t got an original thought to contribute. And they would certainly register.

Q. Any plans for the future?

A. Working on the software for the discussion forum is not a priority for me or my company: it’s good enough, it works, it has created an interesting place to talk about hard computer management problems and get ideas from some of the smartest people in the world. And I’ve got too many better things to work on. Somebody else can create the next big leap in usability for discussion forums.

I just created a New York City forum, to see if geographically based forums encourage people to get to know each other in person as well as online. In my experience, regionally- based communities cause the community to take a giant leap from a simple website to a real society, a true third place.

Creating community, in any case, is a noble goal, because it’s sorely missing for so many of us. Let’s keep plugging away at it.

by Joel Spolsky

2003/03/03

My latest article, “Building Communities with Software,” was sent to email subscribers earlier today.

If you did not get it and expected to get it, you’re probably having problems with overenthusiastic spam filters. I got lots of bounces, mostly from Fortune 500 type companies, rejecting the message, because of “inappropriate content” or because their automatic filters had decided it was spam. Some of them complained about “taboo,” other’s complained about “hard core.” Most didn’t tell me. Such is the state of email today.

If you did not get the article and you want it, you can read a shorter, sanitized version online. But it still contains the word “taboo” so if that offends you you may want to avert your eyes!