Is a Coworking Space Right for Your Small Business?
If you're like many entrepreneurs, you may have launched your business from home, working from your kitchen counter, a spare bedroom, or the corner coffee shop. But while working from home has its perks, you may find it has drawbacks, too. You're distracted. You're lonely. You don't have anyone to bounce ideas off of. And if you want to start hiring employees, you may have nowhere for them to work.
Given all of this, you may consider renting a dedicated office space, but taking on the expense and commitment can seem premature, especially when you don't know how big or how fast you'll grow. That's when upgrading to a coworking space might be the best next step.
Wondering if a shared workspace is right for you? We talked with owners of coworking spaces in Atlanta and Birmingham about how their members have benefited from them and what type of businesses they work best for.
The main reason to consider a coworking space is that it represents a mind shift in how you perceive your business.
What are coworking spaces?
Coworking spaces are places where workers from different businesses share a work space that resembles a typical office setting. They usually feature multiple desks in an open plan work space as well as private offices. The private offices can be small (intended for solo workers) or big enough to accommodate a few people.
Most coworking spaces offer more than just a desk; they also have a variety of common spaces, such as a kitchen and break room, conference and meeting rooms, and a reception area.
Unlike traditional office spaces, coworking spaces typically don't require a long-term lease; in many cases you can commit for as little as one month.
Because coworking spaces are designed to replicate the community feel that many entrepreneurs and small business owners miss from previous office settings, they offer plenty of opportunity for camaraderie and collaboration. Some owners try to create a sense of community by hosting social or professional development events for members.
What are the benefits of working in a coworking space?
1. Improved productivity
Working from home can be distracting. “It is very easy to let one small thing lead to the next small thing, whether it's cleaning your kitchen, chauffeuring your kids, or running a quick errand," says Kim Lee, CEO and founder of Forge in Birmingham, Alabama.
When you are working from home, you might also feel constantly tethered to your work. “This was not healthy for me," Lee says. “Even during 'non-work' hours, I often felt guilty that I should be working."
Having a formal place to go to work can eliminate distractions and create proper work-life boundaries.
2. Input from other entrepreneurs
The coworking setting encourages you to create a sounding board where you can bounce ideas off of others, much like a ready-made focus group. Typically, you'll be sharing space with people from companies at various stages; some might have already gone through what your company is facing, while others are right behind you and can benefit from your experience.
“Being a small business owner often entails extreme highs — but also some low lows," Lee says. "It's important to see you're not alone, and your co-members can provide that helpful perspective."
3. Opportunity to cultivate local contacts
Lee watches members in these spaces form genuine, trusting relationships, which can sometimes lead to new business opportunities.
Amy Hoover, president and co-founder of the Atlanta-based Strongbox West, has witnessed the same interactions among her members, many of whom have made connections to others with complementary skill sets. She has seen an independent SEO expert provide services to a small marketing firm lacking that specific capability; a designer who connected with a coder; and a fledgling attorney who has found clients among the young businesses. “It's been really fun to observe the interactions of our members and watch these relationships come about," Hoover says.
4. Motivation from a community of like-minded business owners
Being surrounded by others who are enthusiastic about their business is incredibly motivating, Lee says, and she has seen members' overall happiness and success rise as they take advantage of the benefits the shared workspace offers. “You find a sense of community when you associate with others who are also working toward a vision." A study by the Academy of Management supports this, finding that entrepreneurs in coworking spaces believe the community aspect is the biggest benefit.
Joining a coworking space represents a mind shift in how you perceive your business. “Your business can only grow so much if you stay at home," says Lee. "If you're a new entrepreneur or small business owner joining a coworking space, it makes the statement that you're a professional, and you've decided to invest in yourself and your business. It legitimizes you."
What types of companies thrive in a coworking space?
Lee says that a coworking space is best suited when the success of the business is not tied to a physical location. The common trait among most of these companies is that a majority of the work can be done from a computer.
Here are some of the situations for which Lee and Hoover recommend coworking:
- A variety of industries and roles: Lee says the members of Forge run the gamut of industries, although many of them are service industries, such as advertising or landscape design. And these spaces are not limited to entrepreneurial companies: Hoover says that Strongbox West also hosts individual remote workers who miss the traditional office environment.
- Small companies: Once freed from the constraints of a home office, multiple employees can be brought together under one roof. Lee says that most of her groups number from about one to five, with the largest topping out at 18.
- Companies with fluctuating headcounts: The flexibility of coworking space makes it conducive to growing teams. “We have watched as our member companies grow and are able to stay here because they can move to larger offices or even just rent an extra desk for a new employee or intern," Hoover says. “Committing to space on a month-to-month arrangement is perfect for companies that are in expansion mode."
A coworking space allows you to take the best things you might miss about the corporate world — like colleagues with whom you can brainstorm or swap stories about your evening, and even the camaraderie of a celebration on your birthday — and replicate them while still pursuing your career dreams, says Hoover.
Or as Lee puts it, “It lets you have coworkers, without the politics of coworkers."
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