Why do accelerators (except Y Combinator) have coworking spaces?

Y Combinator (YC) are the world’s most successful accelerator.

They are so successful that the meaningful comparison is YC v every-other-accelerator, and not YC v the-next-best-accelerator.

Unsurprisingly, accelerators around the world are inspired by them, and take measures to copy them.

And yet…

YC does not have a coworking space — by design — but just about every other accelerator does.

Why?

First here’s Sam Altman (from this interview with Tyler Cowan) explaining why they don’t have coworking spaces.

I used to say there are 3,000 YC clones in the world. I have since learned that there’s 8,000 in China alone. So let’s say the whole number in the world is 16,000.

Every time someone decides they’re going to build the next Y Combinator, the idea is always the following: “It’s going to be just like Y Combinator, except we’re going to provide free coworking space.” I always want to say to people, “Did you ever think that maybe we thought about that, and it’s a feature, not a bug, that we don’t have it?”

I think the single thing that has differentiated YC more than any other decision we’ve made is that we do not have a coworking space. We bring the companies together once a week, but that’s it. It’s enough for a community, but it is enough to build your own identity.

Coworking spaces have two big classes of problems. Number one, they are a band-pass filter. Good ideas — actually, no, great ideas are fragile. Great ideas are easy to kill. An idea in its larval stage — all the best ideas when I first heard them sound bad. And all of us, myself included, are much more affected by what other people think of us and our ideas then we like to admit.

If you are just four people in your own door, and you have an idea that sounds bad but is great, you can keep that self-delusion going. If you’re in a coworking space, people laugh at you, and no one wants to be the kid picked last at recess. So you change your idea to something that sounds plausible but is never going to matter. It’s true that coworking spaces do kill off the very worst ideas, but a band-pass filter for startups is a terrible thing because they kill off the best ideas, too.

So why does no one copy them?

It doesn’t seem likely they’ve all discovered something YC hasn’t.

Perhaps it’s so counter intuitive to think of each start up as a bespoke invention: at the beginning they look the same, and the service offered by the accelerator to each is the same, makes sense to give them the same office space. But they aren’t the same, one will fizzle out in a few months, another will become worth a billion dollars.

I wonder if the real reason is some version of ‘career risk’ mitigation (h/t Brent Beshore).

Yes, the accelerator wants to help create amazing companies, but it also needs to look good if it fails to do so. A coworking space let’s the accelerator show how they eliminated the worst ideas (as Sam Altman describes above) and how they could see everyone was working hard.

In other words, the accelerator is not optimised around the successful creation of new ventures, but around surviving the failure to do so,

If this is true, while they may still do good, there is a misalignment of incentives between the accelerators and the companies they help.

If it’s not true, then I’m still waiting for an answer to my question.