Did you know that the first coworking space, founded in Berlin in 1995, was a hackerspace?
Despite their notoriety, hackerspaces were actually community-focused public locations where like-minded people could get together and work. These spaces are considered the precursors to today’s coworking spaces.
Whilst coworking spaces have come a long way since 1995, the guiding principle remains unchanged; collaboration and a sense of community. Over the past 25 years, we’ve also seen major changes in the way people work. An increasing number of professionals are eschewing traditional forms of employment in favor of freelancing and contract work.
In fact, there are currently 56.7 million people who freelance in the U.S. It’s expected that by 2020, freelancers will comprise roughly 40 percent of the American workforce.
As the workforce becomes increasingly mobile and people enjoy the flexibility of choosing their own work schedule, many experience a real sense of isolation caused by working from home or from an anonymous cafe. Coworking spaces solve this problem by creating hubs where like-minded people can get together, share ideas, collaborate, and keep working independently on their own projects.
The Future of Coworking
The future of coworking spaces is bright. According to a survey conducted by Deskmag in 2017, 1.7 million people were estimated to be working in around 19,000 coworking spaces around the world by the end of 2018. If that weren’t enough, industry leaders predict that coworking spaces will have a role in every industry in the world over the coming years.
The mobile workforce has embraced coworking spaces because, aside from providing affordable office space and all the necessary amenities, they offer a community in which like-minded individuals can get together to create, share resources and network, whilst continuing to grow their own businesses.
If you’re thinking of starting your own coworking space, now’s a great time to do it. The interest in coworking spaces is strong and it only seems to be on the rise.
With this in mind, here are seven steps you could follow towards building a thriving coworking space.
1. Know Your Intent
What’s the reason you want to start a coworking space? Is it to make a profit, or to benefit from the bubbling creative environment? In the case of the latter (which is not uncommon), you will operate your space not with your eye on the bottom line, but on the benefits of bringing so many talented people together.
2. Gauge Your Appeal
Before you sign the lease or buy any furniture, you need to ascertain whether there’s actually demand for your coworking space. To scope and promote interest, you could create a group on social media and then host some events. As you do this, you’ll not only be doing some important groundwork, you’ll also be building an online community, which will serve as a marketing avenue for your coworking space when it’s up and running.
The value of good old-fashioned face to face conversation can’t be underestimated. Go to where your clientele normally works and gathers and talk to them, get involved and participate in their events and build rapport.
If, initially, there’s only a few people interested in your coworking space, keep it simple and find a suitable place to meet once a week. This way, you start where you’re at and grow as you gather momentum. Then, when you reach critical mass, you can delve into step three which is deciding on a viable business model for your coworking space.
3. Decide on Your Framework
Typically, a business model for a coworking space falls into one of these five categories, and you can pick the one that best suits your particular circumstances.
Coworking Space With Private Offices
If your space is big enough, renting out private offices within your coworking space is a good idea if you want to maximize your income. You could advertise these as having the added value of being right in the hub of a working environment that’s abuzz with creative and talented people.
Coworking Space Within Your Business
If you have a business with unused office space, then setting up a coworking space can offset some (or all) of your maintenance overheads and office set up costs. The advantage here is that the money you make from one business can offset the down times in the other. In addition, you’ll have access to a symbiotic relationship in which talented people can help with your projects and you can help them with theirs.
Coworking Space Within Private Spaces
You could partner with a cafe or property owner to get your coworking space off the ground. There are cafes, pubs, and restaurants that can open their doors as coworking spaces during closing hours, bringing the owner an additional income stream and your plans to fruition. Similarly, you may be able to strike a deal with someone who owns space that’s vacant or underused and secure a relatively inexpensive lease.
Coworking Space Within Public Spaces
Your local city council may prove to be an untapped goldmine of resources for your coworking space. Consider talking to them about your idea to see how it aligns with their funding and space opportunities.
Coworking Space With Events
Hosting events within your coworking space gives you a revenue stream whilst also providing you with another way of getting your coworking space in the public eye. For example, you could host meet-ups, film nights or talks. Are you looking for a way to get all of the benefits of starting a coworking business, with the flexibility of being able to choose between running your own brand or leveraging an existing brand name?
4. Money Matters
Sound financial planning is essential to the success of your coworking space, as are legal and insurance matters. They are however, beyond the scope of this post. Here, we’ll touch on ways to finance your coworking space, how to structure your fees schedule, and ways to make your coworking space more economically viable.
Decide how you’ll finance your coworking space. Will you use your own money or find investors? Local government bodies, people with a real estate portfolio, wealthy friends, family, or business contacts may prove to be good funding resources.
Base your price schedule on daily, weekly, monthly and yearly rates. Users who book for longer periods are rewarded with lower rates. Request that payment be made upon booking, that way you receive your money even if the person doesn’t show up.
Always have a few desks on standby in case you overbook and everyone turns up. Charge for conference and meeting rooms.
5. Making it More Economically Viable
If you’re looking to make a profit from your coworking space, there’s a myriad of ways you can make it more economically viable, limited only by your imagination and budget.
You could integrate as many services as possible to your coworking space so users spend more of their money inside than outside of it. For example, you could install a cafeteria, a lap pool, a sauna, and a gym. You could offer massage, yoga and meditation, dry-cleaning services, personal assistants, even sleeping cubicles like they do in Japan.
Another way to make your coworking space more economically viable is to attract corporate customers who require meeting spaces for their remote teams. You could rent out an entire floor in your coworking space to these types of customers, offered as package deals including accommodation and fun outside work activities. Since corporate customers are notoriously high-spending, you can charge premium rates for your services.
6. Get Dressed for Success
Setting up your coworking space where your clientele is, has traditionally meant being in the city. However, locations that are off the beaten track are becoming increasingly popular as coworking spaces because people are moving out of the cities in favour of more affordable living in the suburbs. Remote workers in this demographic are also in need of somewhere to work that isn’t necessarily their home. By serving this group, you are tapping into a market that has great potential for growth.
Provide high-speed broadband internet and VOIP. Set up Ethernet plugs for each private office and workstation.
Furniture and Fixtures
There are no hard and fast rules here. You can basically be as creative as you want. You can go really upscale designer, mid-range Ikea, boho, or a mix of all three. You can find some really cool stuff at flea markets, second hand stores, auctions, and second-hand office furniture dealers. You are only limited by your budget and imagination.
If you can’t provide a cafeteria, install a kitchen or kitchenette with coffee and tea making facilities, a fridge and an oven. Provide the tea, coffee, milk, and sugar and don’t skimp on quality! Your customers will love you for it.
This might sound obvious, but always keep bathrooms fully stocked with soap, hand towels and toilet paper. If you can afford it, hire someone to clean your coworking space once a week. Otherwise, make sure you never forget to do it.
Invest in making it pleasant. A recreation area with table soccer is always a winner and, if you can, provide a chill out area with comfy sofas and a bookshelf with interesting things to read.
Provide conference and meeting rooms; these will not only make the lives of your customers easier, they’ll also provide you with an additional source of income.
7. Shiny Happy People
Aside from providing great facilities, think about ways to bring your community together outside work hours. Organize celebrations, BBQs, trivia nights, happy hour, anything you can think of that gets people together in a social and fun way. These moments can foster bonding between people, loyalty towards your coworking space, and ultimately attract you more customers. Happy people will tell their friends.
Stefan runs a coworking space in his web design business. He has this to say about his experience as owner of a coworking space, “It’s great for socializing, it enriches my daily life because I can exchange ideas with other people, make new friends, stay up to date with the latest tends, sometimes even share work. Financially, it helps because I can share resources and offset internet and utility bills.”
Starting your own coworking space can be the greatest thing you’ve ever done. With its focus on community and shared values, you’ll always be meeting interesting and talented people with whom you can exchange ideas, collaborate, and make significant contributions to each other’s success.