12. Diana Rothschild, CEO of Coworking Space Nextspace, Founder of NextKids

Episode 12 - Diana Rothschild Talks Coworking and Daycare

Guest: Diana Rothschild, NextSpace  Today I chat with Diana Rothschild, President and CEO of NextSpace, and  founder and Chief Mom of NextKids, the childcare space partnered with NextSpace.  NextSpace opened in 2008, and has nine locations in the Bay area and in Chicago.. NextKids has been open for nearly two years. Diana and I chat about the beginning of the child care and coworking movement, her motivations, and the future of the industry.

Most people would not guess that Diana is a farmer. Tell us a bit more about what goes on in your backyard.  Diana is an urban chicken farmer with three chickens. They’re not just any chickens; they’re foodie chickens - Diana also loves to bake, so they supplement their diet with kitchen tidbits and fresh bread. Her chickens even receive organic compost scraps, complements of a local juicer.

Tell us a little bit about you both professionally and personally.  Diana is also mom to two daughters under the age of four, and specializes in hosting a pre-bedtime contest each night to see which child can build the tallest tower before her sister knocks it down. Some of her professional work also stems from her job as a mom - as a businesswoman, she was motivated to start NextKids so that she could spend more time with her older daughter. In fact, the day Diana signed the lease for her childcare space, she found out that she was pregnant with her youngest.

Tell us a bit about NextKids. Who can use the service?  NextKids is exclusive to NextSpace members only, and accepts children from three months old through three years old. Diana tells us the next NextSpace location plans to include a baby coworking area, where parents with children under three months can work with their children, but the official NextKids program is limited to children three months and older.

You’re a pioneer. Two years running for a service like this is a record. What is it that makes the model so hard to achieve? Diana says that it’s a combination of factors, including timing, partnering, cost structure, and market awareness. This is such a new idea and way of thinking about work that it requires a lot of consumer awareness. It’s also important to have a strong philosophy about how you want the care to be run, who you want to run it, and the amenities you want to provide. Take NextKids, for example: the NextKids program is a full-service, school day length program. They hire only incredibly qualified teachers focused on early childhood development, which Diana believes has led to their ability to provide high quality care and gain trust. However, that also makes it very expensive to operate. NextKids has had to pair a daycare setting with a professional workspace, and deal with all of the regulatory and safety requirements surrounding childcare while satisfying parents and community members. The niche of people who could use the service is also quite small, but Diana says that their particular mix of components has led to a lot of happy families. Just two years into the program, they’re beginning to see second children and referred members.

Before someone tries to start a childcare program in a coworking setting, what are the things they need to understand? Diana came up with a list of three, equally important things to understand if you want to mesh childcare with coworking.

First, you need a strong philosophy for what you’re going to create. For example, you could have a pop-up type of childcare service, offered at various times and places throughout the week. Or, you could have a stable location, with stable operating hours, that families can plan their weeks around. These are two very different types of products that will work for different types of families.

Second, you need to know your strengths and weaknesses. You need to know what you can do, and what you need to bring in support for. Partnering with NextSpace, who had already been building and fostering coworking communities for four years by the time Diana joined them, helped NextKids tremendously.

The third thing you need is money. It is a long road to becoming a profitable venture, so you need enough funding to get you through early small business hurdles. The average school takes three years to become profitable, and NextKids is very much like a school.

Starting a coworking space is a bit of an undertaking because the industry is so new. People also underestimate the difficulties of starting a daycare. Combining the two, when so many single-business startups fail, must be very hard. Diana says it can definitely be done. They’ve learned a lot in the past two years that would allow them to improve their design at a future location, and break even earlier. She mentioned that the world needs this service, and companies want it. Only 20% of members of their shared NextSpace community have joined NextKids, but startups at that location have been able to recruit new employees because they offer childcare.

Has there been skepticism? What sort of perceptions have you had to fight? The workspace is still a business environment, and the children are not disruptive. NextSpace has given tours of their location, and some of the potential new members have not even realized that there is a childcare facility in the space. There is a separate children’s entrance, down a long, quiet hallway, to keep conference calls and meetings undisturbed. Some parents also expect a lengthy co-op component, but time requirements for parents are quite short. Parents of part-time children contribute half an hour of classroom time per week, and parents of full-time children contribute one hour per week. This is primarily to give the parents an opportunity to see how the teachers engage with their children.

What do you think the future of coworking and daycare is? Will it be more successful in urban areas, or the suburbs? Diana’s initial speculation is that either suburban or urban childcare/coworking combinations could be successful. Some of their urban memberships are generated by foot traffic, which is less likely in a suburb. However, even though fewer new clients will find their way to the space by accident in a suburban environment, people are willing to drive longer distances to live outside of the heart of the city.

If you had to look five years out, what will coworking and daycare look like in five years? The future is really exciting. Diana gets calls from people interested in the concept across the world. Her hope is that in five years, there will be two or three different types of coworking and childcare models that work really well for different types of families.

What’s next for NextKids? NextKids is refining their model. They’re focusing on the building the team, adjusting how NextKids works financially, and learning how to market the service. They need to learn how to convey how high their quality of care is, and which marketing channels to use. There’s not a clear place to start, because NextKids is neither a normal daycare nor a normal coworking space. Some potential NextKids clients could already be looking at nanny shares, aupairs, or even taking several years off work to care for their children before even considering a coworking space. There are also plans to expand the NextKids concept. Diana also wants to grow the business to at least one more Northern California location, plus locations in Southern California and Chicago.

Resources Mentioned in this Podcast:



Diana on LinkedIn


Thank You for Listening!

Thank you for taking time to listen to the show!  Know someone that could benefit from Diana’s story? Use our share buttons to pass it along!

If you enjoyed the podcast, please leave us a review on iTunes. It’s the best way to help others find our content!

Lastly, don’t forget to subscribe to our podcast on iTunes or Stitcher to get automatic updates!


PodcastJamie Russo