Why Coworking Is on the Rise
Work is no longer a place. Telecommuting, freelancing and online work have been growing for years, and the lines between our professional and personal lives are increasingly blurry. We make dinner reservations from the office, and take our conference calls from the dinner table.
As work becomes less routine and more results-focused, people are coming back together to foster collaboration based around results. A movement is taking shape--the rise of coworking. According to a recent report by DeskWanted, there were 2,498 coworking spaces as of February 2013, up from 703 spaces in February 2011. How many commercial real estate models have seen 3.5x growth over the last two years?
Coworking is a logical extension of the collaborative consumption model into the commercial real estate market. We have "software as a service," "platform as a service" and now "office as a service." Eryc Branham, the Chief Revenue Officer of RocketSpace, one of the top San Francisco-based coworking spaces and accelerators, explains:
If you are a 15-person startup in Portland and need to find 3,000 square feet of office space, good luck. The economics just don't make sense and it's a major distraction. Should you be spending your time negotiating leases, managing build-outs and setting up your IT infrastructure, or should you be heads-down building your product? The traditional commercial real estate model is just broken.
The Coworking Evolution
As coworking grows, a hierarchy of models is starting to emerge. At the most basic level, you need a desk, an outlet, an Internet connection and chairs. You can find any number of 90s-style cube farms in one of the various shared-space aggregators. The next level up is the "love and esteem" equivalent--collaborative spaces, open and fresh floorplans, and chrome Sub-Zero fridge to hold gallon-sized cans of energy drinks.
At the top of the hierarchy are models such as RocketSpace and Google's Campus London that create a curated community, designed to encourage cross-pollination among the residents. Branham describes RocketSpace as an "innovation campus" that offers acceleration programs, resources from corporate partners such as Microsoft and Amazon, and assistance in attracting talent and raising funds.
According the head of Campus London, Eze Vidra, more than 1,000 entrepreneurs flow through Campus every week. As a result, it is rapidly becoming ground zero for the London tech scene, with the old warehouses around it morphing into more coworking spaces and funky startup offices.
This evolution of coworking--from a desk and a chair, to a collaborative workspace, to a curated community--will only continue as companies and professionals grapple with the changes in how, when and where we work. The move towards online, distributed and independent workers is the biggest shift in employment since the Industrial Age, which brought people to city centers, because physical proximity was a requirement. As those physical constraints are lifted, coworking and similar models will allow businesses to become more flexible, collaborative and results-focused.