With tons of small businesses and the rise of the gig economy, there has been a proliferation of coworking spaces over the last 5 years. Almost every city has coworking locations, so entrepreneurs, small businesses, and freelancers can work in a more amenable location than the local starbucks. Of course, there are pros and cons to coworking spaces, especially for small businesses.
Coworking spaces can be a great choice for small businesses and entrepreneurs just starting out. Here are a few of the many benefits to having your business operating from a coworking space.
Because of the nature of small business, leases in coworking spaces are often extremely short. Depending on the coworking provider and the size of the space provided–whether you’re working from a hot desk or have a private office–leases can be anywhere from month-to-month to 1 year. Unlike traditional offices that typically require 10 year leases, these short-term leases offer a great deal of flexibility.
With so many coworking spaces to choose from, they often differentiate themselves by the amenities they offer. The lists of amenities are long. Pool tables, fooseball tables, free coffee and beer, free events, outdoor space, and discounts are just some of the many amenities that you can find at coworking spaces. WeWork members, for example, receive discounts to hundreds of different products and services from Amazon Web Services to Berleigh footwear and everything inbetween.
Another great benefit of coworking spaces is that they don’t require a lot of money to get started. Most long-term office leases, especially for smaller companies, require large security deposits which can be equal to or more than an entire year of rent. This is not the case at coworking spaces. Deposits are typically one or two months.
Flexibility is key for small businesses, and coworking spaces offer a great deal of that. If your business is growing rapidly, you can easily expand within a coworking space from a small office for 2 or 3 people all the way to offices for 20+ people. With traditional offices, you need to rent enough space to include your planned growth but at a coworking space, you can keep sizing up.
Finally, coworking spaces have great communities unlike what you find in traditional office buildings. Because there are so many different companies doing different things, you can make great connections. Entrepreneurs, more established businesses, and companies that cater to small businesses all coexist within these coworking spaces, and the spaces themselves put on events to foster these connections.
Of course, coworking spaces aren’t all sunshine and roses, and there are some drawbacks to consider.
Coworking space is generally inexpensive from a pure dollar standpoint, but on a cost per square foot basis, it is extremely expensive. Coworking space can cost anywhere from 3 to 10 times as much on a per square foot basis as traditional office space. This means that a companies can outgrow coworking spaces pretty quickly.
While there are many coworking spaces available, especially in big cities, there is far more traditional office space. If you are looking for your office to be located in a very specific area, or you’re looking for a specific type of building or space, you may not be able to find that with a coworking space.
While this is starting to change, the general image of coworking spaces are buildings filled with millennials playing shuffleboard and drinking beer in the common spaces and not getting a lot of work accomplished. And it is a reputation that isn’t entirely undeserved. Unfortunately, this may cause clients or potential clients to judge your company on its connection to coworking which may not be good for your brand. This can be especially true if you meet clients at your office.
The setup of offices at coworking spaces have limited customazation. Most things are built in and furniture is often included. While these move-in ready spaces are convenient, they limit your customization. This means you probably can’t bring your fancy desk, and you almost certainly cannot change the layout of the workstations. Aside from rugs, wall art, and the chairs, your customization options will be extremely limited.
This is the downside to the community focus and tightly-packed design of coworking spaces. There is very little privacy and quiet. Offices in coworking spaces are packed one next to the other, and they are often nothing more than glass boxes of varying sizes. This means everything you do can be seen and, to a lesser extent, heard by the other people around you. In common areas, this problem is even worse. Every office has distractions and limited privacy, but these are amplified considerably in coworking spaces.
While coworking spaces can be great for entrepreneurs and small businesses, they aren’t without their drawbacks. They can be a great place to start a business and scale up, but sooner or later it will make sense for companies to leave to their own space. If you’re interested in learning more about the pros and cons of coworking spaces, please get in touch with us.