How Co-working Spaces Help Startup Thrive
Co-working spaces are taking over the world. What used to be popular for just individual freelancers has now morphed into an invaluable resource for scaling competitive businesses. CNBC details how large corporations have been renting out blocks of desks for their own operations and employees, which has significantly raised the value of the co-working space concept in the global market. In fact, by the end of 2019, the co-working space market was rumoured to be worth an estimated $26 billion (₹1.8 trillion). But what are the driving forces behind this booming industry, and how can coworking space help startups take advantage?
Less overhead costs = more resources to scale
Multi-millionaire and Upwards Fintech co-founder Nimesh Verma sees co-working spaces as a frugal way for tech entrepreneurs to achieve their goals. This is because co-working spaces can reduce overhead costs for scaling businesses. While individual freelancers and tiny teams of workers were busy flocking to co-working spaces, companies were realising that it’s much cheaper to rent these new spaces as compared to either owning their own office or renting one out through a traditional lease.
IT consultant Susan Ward points out that traditional commercial leases tend to come with caveats and costs that just aren’t ideal for low-cost startups. These contracts can last for an average of five years, require hefty deposits, and can be difficult to terminate —inflexible conditions that can limit a business model’s ability to scale. Co-working spaces solve this problem by functioning more like a club for business instead of a traditional space-for-rent. Through flexible rental options, they allow business models of all shapes and sizes to not just lower overhead costs, but also to avoid being tied to conditions that will hamper their ability to change with their industries.
Customisability is the key to scaling
By providing new, highly flexible and conducive environments for business, co-working spaces enable new levels of customizability — one of the key ingredients for any startup’s growth. Big and growing Companies like Industrious notes how the flexibility of co-working spaces give startups the ability to customise operational conditions for teams of all sizes, which is an essential factor in enabling businesses to scale on their own terms. This is why every business model, from individual to multinational, is finding value in utilising co-working environments. As industry demands and technologies continue to develop at an increasingly rapid pace, what follows is a demand for individual freelancers, big businesses, and struggling startups to customise the way they deploy resources. And if you don’t want your startup to get swept away by these disruptive, multi-industrial changes, utilising co-working spaces is one of the keys to remaining competitive.
The revolution is collaborative
As the number of co-working spaces is poised to go way past the 20,000 marks in 2020, it’s worth remembering how it all started with just 75 co-working spaces worldwide back in 2007. This level of growth underscores Data-Driven Investors’ observations on how co-working spaces are shaping new cultures of entrepreneurship. Apart from driving down overhead costs for struggling entrepreneurs, co-working spaces are bringing together workers with different backgrounds and specialisations under their roofs, organically establishing countless networking opportunities for decision-makers in the world’s most significant industries.
In fact, many of the businesses we’ve featured here on Good Vitae are themselves utilising co-working spaces to scale. And as this culture further develops, collaborations are bound to follow, potentially resulting in new technologies, companies, and even revolutionary business models. This is the ideal type of environment for any ambitious startup to thrive. By seizing the opportunity to save on rent for traditional office space, you might also be staking your claim in the future of your industry.
