Coworking in Asia
As this is my first post on Medium, a short introduction would be in order. I am part of the Coworkies team, a startup online platform that aims to connect coworking spaces and its members around the world. As Coworkies began in Berlin, my job was to help reach out to coworking spaces in Asia and the region. Of course, Asia with its 48 nations is too culturally, socially and economically diverse to be lumped into a single entity for discussion, but I will try to give an overview that would be accurate in majority of the member states.
It was only a matter of time, that as a networking platform, Coworkies had to reach out to the coworking spaces in the largest continent: Asia. Demand for flexible working environments there have expanded exponentially over the past few years, and workspace providers have been aggressively expanding to each get a bigger piece of the pie. This should come as no surprise — the number of startups (who are the main users of coworking spaces) have sky-rocketed. After all, startup ecosystems in Asia are improving, due to proactive stance of the governments in nurturing the startup ecosystem, as well as backing from crowdfunding and investors. Asia is also home to some of the fastest growing economies, and foreign companies that are enticed to venture into these promising new markets favour coworking spaces as an alternative for establishing their site offices.
Some of the top cities to start a business are located in Asia, and it’s no wonder. The strong government support in these countries are not their only pulling factor, but the deep talent pool and strong investor funding is making entrepreneurship a desirable career path. In Beijing, the Chinese government are giving tax reliefs of up to US$1,500 for innovative firms and startups; a $6.5 billion VC fund specially for startups was set up in early 2015. In fact, 4.4 million businesses were created in 2015. Taiwan is the first Asian nation to set up a government funded outpost in Silicon Valley back in June 2015, called the Taiwan Innovation Entrepreneurship Center, and Hong Kong had the 5th fastest growing startup ecosystem in the same year. In Bangalore, the huge market and multitude of engineering graduates mean an engineering and technology-focused startup scene. Entrepreneurship has been blooming in tier 1 cities like Mumbai, Pune, New Delhi and Chennai. And Southeast Asian countries are not losing out either. Jakarta hosted some major entrepreneurial events like Startup Asia and Global Entrepreneurship Week, as well as organized global entrepreneurship programs, such as Endeavor Indonesia and Global Entrepreneurship Program Indonesia, just to name a few. An even more astonishing statistic is that in a 2017 research report by Startup Genome Project that covers 10,000 startups and 300 partner companies, Singapore overtook Silicon Valley as the world’s №1 for startup talent, and tech startups in that country can enjoy notable government subsidies and easy access to experienced software engineers and growth employees.
Startups are not the only ones driving the demand for coworking spaces in Asia though; bigger companies are beginning to see the appeal of working in these “startup spaces”. Cloudfare, a content delivery network and web security firm, moved into a Singapore coworking space JustCo despite there being cheaper office spaces in the rental market. HSBC moved 300 staff into WeWork’s coworking space in Causeway Bay, one of the world’s most expensive districts in Hong Kong. Citing flexibility of coworking spaces as a compelling reason apart from more obvious ones like cost-effectiveness and the convenience of a fully furnished working area, large companies that are entering into an unfamiliar market may not be ready to take up a long-term lease in traditional offices when their business have yet to stabilize and their workforce not sizable enough. As such, there is freedom to downsize or grow their workforce in coworking spaces that have the versatility to accommodate these rapid changes.
Yet a more magnetizing factor means this phenomenon is not confined in Asia alone. Blue-chip companies like Current, Silicon Valley Bank, Cognizant and Merck are working from WeWork’s coworking locations around the world, in order to build connections with innovators and startups while they are still in the early stages of development. In fact, some companies have even started converting their own office spaces to house startups from relevant sectors. DBS launched “The Vault” for innovative Fintech startups who are in their accelerator program, and in doing so, they hope to make it easier for startups to develop and experiment with their ideas by providing them the mentorship and networking opportunities needed. Interactions and partnerships with these smaller businesses presents bigger corporations with valuable insights about the market and open doors for innovative strategies. Other reasons for the redesign of traditional office spaces includes boosting the employee engagement rates by actively testing more open and creative layouts for various functions. The vibrant and sociable atmosphere of coworking spaces keeps workers happier and healthier, as surveys have reported.
Currently, coworking spaces occupy up to 7% if total office stock in mature markets like Singapore and Hong Kong, and is projected to grow to 15% by 2030 in Southeast Asian countries alone. As the trend continues, competition between international, regional and local workspace operators intensify. Coworking unicorn WeWork is already opening branches in Singapore and Tokyo, while eyeing markets like Shanghai, Beijing, Hong Kong, Seoul and Bangalore. Singapore’s Spacemob landed itself a $5.5 million seed round to fund its expansion across Asia Pacific. For local operators, many of them are turning to target niche communities, open multiple locations or expand their current spaces to attract more clients. For example, in Japan where career and home life remains markedly segregated for women, spaces are offering additional facilities, like child-sitting services or an all-women community to cater to working mothers. Others feature an exotic view and relaxed lifestyles for digital nomads who can work anywhere with good Wi-fi connection, such as Hubud in Bali and Kohub in Thailand.
With the number of players booming in the Asian market, coworking spaces there must make available to potential clients resources for growth, whether it is having a close-knit community or partnering with large corporations to establish accelerator or incubator programs, and this involves boasting an impressive list of contacts to set themselves apart from their competitors. As we, at Coworkies, are driven to take the idea of building relationships across the world for coworking spaces, we envision our platform to bridge the gaps between the continental markets. In order to provide our users with greater possibilities for collaboration and move towards our vision of creating a global network of coworkers, we are looking to invite more coworking spaces and coworkers in Asia onto our platform. We are excited for this journey and we hope that you as our cherished partner will be on board with us!