We often get asked by our clients ‘what do you think about co-working spaces?’. If the client needs 200 sqm, 300 sqm, 500 sqm and is looking at the longevity of the tenancy and how long they have to commit for, then they start to think about co-working spaces.
On the plus side, there a few good reasons for going into co-working spaces. Brilliant long-lasting partnerships have been formed through co-working spaces, resulting in many great ideas.
One good reason is the low cost of entry in terms of capital outlay. There is just a weekly or monthly commit rather than huge capital cost. You can easily chuck in $100,000, $200,000 or even a million dollars into a tenancy and amortize it over the next 70 years, vs. a monthly fixed cost. This is hugely attractive for people that are in growth phase/startup stage, and don’t want to commit to a particular size tenancy.
Co-working spaces can also be considered elastic sided. You can take one or 3 desks, or 8 to 12 desks, or more. This allows you to expand organically as your team grows, as there is opportunity to take up more positions if needed. Maybe your team needs to expand by another 20 people to resolve a client issue and meet their expectations to bring a big project over the line, such as a 6-month contract. You can expand and contract to take up more or less space. It’s also flexible in terms of cost, especially businesses trying to keep a lid on their fixed overheads.
A co-working space also provides a team buzz environment. It provides momentum with like-minded people working in the same zone, keeps people fired up, fresh and turning up to work with a spring in their step. Co-working spaces have also created some long-lasting friendships, professional and personal which continue long afterwards.
They also give growing businesses access to other teams that could be within the same floor. There could be professionals from graphic design, IT etc. that that you could access to help grow your business.
On the negative side, acoustic control can be a huge challenge, impeding productivity and workflow. If you get distracted, it can take up to 20 minutes to get back on task. You could be in a deep flow of work and get disrupted by other people within the co-working space as you can’t control your environment. You can’t control sound, and peak flows and demands of other people sharing the space.
A massive concern for us is theft of ideas or loss of market sensitive information out into the world. We’ve worked on several projects that have been very market sensitive, developing new offices for brands from Sydney for example, who want to break into a new market in Victoria. If their brand was spotted this side of the border, it would have broken their whole cloak-and-dagger approach where they wanted to hit the market in one shot.
The most tragic thing that’s ever happened as a result of shared workspaces, over in Europe, a deal that was in hundreds of millions was lost as a result of persons working in adjoining workspaces, who were on the inside track on a takeover bid. Another example could be where someone’s working on a new website. It might be a whole brand-new idea that you’ve got for your client. This then could be inadvertently observed by someone else is in a competitive space, resulting in a loss of lead, or a proposal.
You need to consider both pros and cons before you make the jump into co-working. If you’d like to have a chat about it sometime, give us a call. I’m Gavin on 0439 002 575. We would love to help you weigh it all up, look at your tenancy costs and see the best way forward for you.