The first time I’d ever heard the word “virtual” in a business environment I was staring at a paperclip with unusually large eyes. For those of you too young to remember the Microsoft Virtual Office Assistant, he or she (it’s difficult to tell with paperclips) gave helpful advice for all your word and excel conundrums.

The small and rather cute animation was one of the first virtual assistants designed to answer all your Microsoft Office queries. It was fairly primitive and often completely inept. However the idea had legs –  even if the assistant didn’t – and since this early development we now have a wide array of virtual options available to all business owners.

One of the most popular has been the ability to set-up a virtual office. The concept was first developed in Boulder, Colorado in 1994 and since then has grown in popularity especially among new businesses and the start-up community.

With business rents throughout much of the UK continuing to increase, the virtual office provides many business owners a sensible alternative to the high running costs of renting office space, particularly during those precious early years when capital may be limited.

Typically services include a virtual business address (often in a desirable part of town), telephone answering services, handling post and a focal point for all forms of communication. To the casual observer the business can look more legitimate, larger and provides a certain level of credibility to your brand with offices registered in the “best parts of town”.

All this is well and good and offers an attractive alternative for sole traders, startups and businesses based at home, but what if your business grows and you need to hire, manage and motivate staff all from the comfort of your own home? Does the virtual office still lend itself to a sensible and practical business alternative?


Keeping costs down and maximising your profits is an essential part of any new business. A virtual office can ensure that the typical office related costs and employee health insurance can be kept to a minimum, allowing your business to grow without the high expenditure and inflexibility usually associated with leasing an office.

cost of office in London

*Data from findalondonoffice – 3rd Nov 2014

The recovery in the economy compounded by the relatively low levels of commercial development will see commercial rental growth likely to accelerate throughout 2015. Virtual offices are increasingly becoming a more viable option for businesses to run their operations without compromising on professionalism.

Attracting staff

One of the frequent problems facing any startup is finding and attracting quality talent. The numerous companies in the digital tech startup scene throughout Shoreditch (London) have frequently commented that finding talent is one of their major obstacles. Businesses with physical premises are obviously limited to the commuting catchment area for potential employees.

Virtual businesses obviously have no such geographical constraints. Talented employees can literally be located in any part of the country and as long as you develop robust management and reporting processes that monitor the quality and quantity of work produced, it really doesn’t matter where employees are located.

Of course some will argue that having the chance to interact with colleagues and share ideas is important in fostering an environment of collaboration, but with the use of the appropriate software, this is still possible online.

Great software to use for your virtual business

Cisco’s Web-ex

Having used Cisco’s WebEx while working in Australia where the distance between the major cities is vast, the video conferencing and virtual meeting software is a very useful tool for any business, virtual or otherwise.

It provides facilities for video conferencing, the ability to share your desktop screen for presentations and allows the control of the screen to be shared between conference attendees. There is a free option for a small number of users and goes some way to ticking off your environment credentials. Reducing the need to travel for all your business meetings can reduce time, travel costs and CO2 emissions. GoToMeeting is another alternative to check out.


Hubstaff provides “time tracking” software that enables you to access data about what your employees are working on and for how long. It can be recorded on a project-by-project basis that allows invoice to be issued based on the time allocated for each task. It also provides a great way to monitor employees remotely and ensure that they’re dedicating the appropriate time for each allotted task.

Using Hubstaff on a regular basis can reduce the need for constant email & phone communication to ensure that you’re up to date on the work being conducted.

Google Drive

One of the cornerstones for any virtual business, Google Docs allows colleagues to share documents and files that can be updated by any member of your team in real time. The lag between email communication is eliminated as feedback and any changes to the docs are instant.


A project management tool that’s very easy to use and visually rather appealing. You can create lists, update workflow, add ideas and updates happen in real time. It can provide a quick overview of any project and the current status across a number of actions. Plus it’s free which is always nice.


Great for team communication and for enabling online “chatter” between staff. It has the ability to store discussions, archive the conversation and store any video communication for later referencing. Integrations with Google Drive & Twitter are nice features and with an app for smart phones allows the communication to continue when you’re away from your desk.

Drop Box

Probably needs no introduction but a simple facility to allow the sharing and storage of files. The secure network is popular with IT where the encryption provides security for any sensitive information. Integration with over 300,000 apps including word, Ciscos Web-Ex and DocuServer, Drop Box is a must have for any virtual business.

Avoiding the dreaded commute

According to the Office For National Statistics the average commute to work throughout the UK is 54 minutes, moving up to 74 minutes for those working in London. With an estimated 1 year of our lives taken up with the often soul destroying commute to work, having the ability to work from home is an appealing option for some.

It’s not for everyone though so be sure to assess new employees thoroughly during your recruitment process. Dedication, self-reliance and the motivation to work alone are key considerations. For many though, the ability to work without someone looking over their shoulder constantly can actually promote productivity and job satisfaction.

Implementing virtual workplaces has seen large companies like IBM save $50 million in real-estate costs per year and while it may not suit all business models, for a large percentage it may just be the most sensible approach.

We’ve come a long way since our first introduction to the helpful but often bemused expression of Clippy (yes I did have to look up his name). Operating a business within a virtual environment is now not only possible, but can be extremely beneficial for a wide variety of businesses. I just hope these wonderful advances in technology haven’t put our little friend out of a job.

This post was written by UK company formation agent Euro Start Entreprises – helping businesses and entrepreneurs open and expand their operations throughout the UK, Europe, US and the Emirates.

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