The boom in the number of co-working spaces followed the entry of Millennials into the workforce.
Why the surge in interest in coworking spaces, you ask? Studies indicate that productivity rates increase when freelancers ditch their isolated stay-at-home set-ups and move into a coworking space, where other motivated people pump fresh ideas within earshot.
If you doubt the growth potential of coworking spaces, consider WeWork. Ranked in 2018 as the sixth most valuable startup per VentureSource, WeWork is a major provider of shared virtual and physical office spaces. WeWork’s net valuation has soared to $20 billion at the low end.
Opening a coworking space may be a business opportunity whose time has come if you approach it with due diligence and proper care.
Tips for Opening Your Own Coworking Space
Opening your own coworking space involves a significant investment in real estate and development. However, with the right tools in place and the right strategy, it can be a lucrative way to build wealth both now and in the future.
Here are some steps to take to make your own coworking space successful.
- Start with the right goal. Successful coworking spaces concentrate on building a strong community of self-employed professionals.
- Build the right network. A robust networking power makes the difference between success and failure in the coworking business. The essence of a successful shared office space is the vitality of its people, not the size or infrastructure of the place. You could rent out the swankiest penthouse downtown outfitted with the best amenities, but if you have not built your community with the proper considerations, there are fewer chances of the best tenants signing up.
- Make your intentions known in the freelancer community. Cultivate your presence in the local chamber of commerce, host a casual working event in your local coffee shop, and reach out to specific freelancers you want to entice.
- Do your due diligence. Make sure you have enough interested parties to buy in when you launch your coworking office space. Each empty office is an expense you do not need or want.
- Choose your location wisely. Creatives and tech workers alike are drawn to work in locations less than 30 minutes’ drive from their homes. Choose a building close to where all the action happens, with access to transportation hubs, parking, restaurants, and event centers. Your neighbors should be as attractive to your clients as the resources you offer.
- Don’t skimp on amenities but count the costs carefully. Offer high-speed internet access, coffeemakers, water fountain (or fruit-flavored water), and a waiting room with a TV. Make the office space collaborative; printers and copy machines should be accessible and in good working order. Your clients are willing to pay money to work under your roof for a reason. Make it worth their while.
- Do not rent or purchase an outdated building without considering the cost of upgrading. Though your initial costs may be lower, you will need to spend more further down the road to upgrade necessary infrastructure such as retrofitting for handicap accessibility, complying with fire codes, electrical wiring, etc.
- Develop a business plan with the goal of sustainability and follow it carefully. Every dollar counts in the startup phase of your coworking business, so be smart with your decisions.
- Aim for variety. Do not fill your space with employees from one single company. If their startup succeeds, they could be out of your space faster than tacky varnish drying on wood and you would need to find more clients. Make sure your clients are a mishmash of freelancers and entrepreneurs.
- Provide quiet booths for clients and drop-in freelancers. Install a booth for undisturbed phone calls, giving clients a place to slink away from the hubbub of creative minds and mouths working all at the same time. Provide space, too, for unexpected drop-ins like freelancers who may only be in town for a day or two.
The advantages of opening a coworking space have never been more evident. Startups need a conducive environment to incubate. Hive minds thrive in informal working spaces that do not have the restrictions a corporate presence enforces.
Offering coworking spaces is a potential blockbuster business idea waiting to happen for an adventurous entrepreneur. If you want to open your own coworking space, Benetrends can help you make your idea a reality using your own 401(k) funds to fuel your success. To learn more, download the Definitive Guide to ROBS ebook today.