The Benefits of Coworking and How to Make it Work for Your Business

Find a list of the latest trends in workspace environments, and coworking is bound to be on it.

If you’re unfamiliar with it, the term “coworking space” refers to a work environment where individuals purchase a membership and work independently or collaboratively in a shared office space. Simply put: it’s about strangers working alongside one another.

And it’s all the rage right now.

There has been a phenomenal surge in recent years in the popularity of coworking spaces. As a testament to that popularity, WeWork, a company offering coworking office space around the world, has been valued at USD$20 billion and recently surpassed JP Morgan as the largest tenant of Manhattan office space.

Plus, according to the 2017 Global Coworking Survey, last year, more than 1.1 million people went to work at 13,800 coworking spaces worldwide.

But coworking is more than just a fad. In fact, for many industries, it’s the new norm.

Wondering if a coworking space is right for you and your small business? We’ve broken down some of the key benefits to help you decide.

Cost Savings

Let’s start with one of the main reasons that small business owners and entrepreneurs join a coworking space: the cost savings.

Coworking provides a cost-effective solution for acquiring office space. The cost of a coworking membership is typically a fraction of the monthly rent for a traditional office, especially if you’re looking to find some space in New York City or Silicon Valley. And unlike rental agreements, the membership terms at a lot of coworking spaces don’t lock you in for a long time.

What’s more, because the membership is a fixed rate, you don’t have to be concerned about unexpected expenses that can come up from taxes or utilities. This allows you to save lots on overhead costs, and not have to worry about forgetting to turn off the lights at the end of the day.

In addition, operators of coworking spaces take care of all the necessary equipment and amenities, like printers, wifi, desks, conference rooms, kitchen access, refreshments, private phone booths, and washrooms.

Think of it as a turnkey office. All you have to do is show up, pay for the desk space that you use, and let the coworking space operators take care of the rest.

That means you don’t have to sink precious resources — both time and money — into managing facilities. Plus, you only pay for space that you really need.

Tip: Carefully read through the membership agreement to identify what is and isn’t included with your plan to make sure you’re not surprised down the road about extra fees to use certain amenities.

Collaboration

Another huge benefit to coworking (and one that some people would even say rivals the cost savings) is the ability to collaborate with others.

Because of the communal environment, a coworking space allows you to interact with other individuals from different companies, industries, and backgrounds. It’s an ideal way to network, find a similar business to collaborate on a project with, bounce an idea off someone, or even find your new BFF.

It’s an approach that fosters creativity and innovation among members of a coworking space.

That collaboration also means you can create a support group of fellow small business owners and entrepreneurs, which is an essential but often overlooked aspect of business development.

A study published in the Harvard Business Review found that people thrive more in coworking spaces compared to traditional offices. One of the reasons was the ability to work with a range of different people. According to the study, “Working amidst people doing different kinds of work can also make one’s own work identity stronger.”

If you just want to focus on your work and skip the social aspect, that’s ok too. An important distinction is that socializing in coworking spaces isn’t expected or required (as in, there are no office politics to contend with so you can just be yourself).

Tip: The people who use coworking spaces are professionals, but be prepared for some minor amount of noise given the nature of the space. Bring noise-canceling headphones with you for times when you need to concentrate on your work.

Combat Loneliness

It’s nice to be able to work from the comfort of your home in your pajamas, but it can get lonely.

And that loneliness among remote workers is a growing health concern.

Vivek Murthy, former Surgeon General of the US, noted the “loneliness epidemic” that is growing with the gig economy as more individuals work remotely could have harmful consequences on a person’s well-being. According to Murthy, loneliness is “associated with a reduction in lifespan similar to that caused by smoking 15 cigarettes a day and even greater than that associated with obesity.”

Another study published in the Harvard Business Review found that coworking spaces are an effective means for combating the loneliness that comes from working alone. Of those surveyed as part of the study, 83% reported being less lonely, and 89% said they are happier since joining a coworking space.

Plus, with improved happiness comes better work and efficiency. Research has shown that productivity skyrockets in coworking spaces, with one study finding that productivity increased by 74%, which then led to a more extensive business network and higher income.

Tip: If you’re not ready to give up the home office completely, look for coworking spaces that offer part-time or casual memberships.

Room to Grow

A common misconception is that coworking spaces are only used by freelancers and entrepreneurs looking to get their businesses off the ground. While those individuals certainly do use these spaces, large companies are now the fastest growing segment of coworking space.

Research by WeWork indicates that by 2020, half of all large companies will have some form of shared office space, whether that’s coworking or another model. Already, Apple, Facebook, Microsoft, and Samsung are all reportedly using some coworking space.

The reasons of big corporations to use coworking spaces are no different than those of freelancers and entrepreneurs. They reduce overhead costs, allow for greater collaboration, and facilitate expansion and growth efforts, among many other perks.

The popularity of coworking among corporations is proof that businesses with multiple employees can readily grow and thrive in these shared spaces.

Tip: Speak with the operators at your chosen coworking space early on to find out about opportunities to accommodate additional workers in the future.

One thing to keep in mind is that no two coworking spaces are alike. Before you decide on a location, take a tour or ask about getting a day pass so you can give the workspace a bit of a test drive.

Take your time to find a coworking spot with a culture and layout that suits your needs, so that you can reap all the benefits of working with strangers.