Sustainability of Coworking Spaces

I’m still exploring the question, “what is coworking?” This is not a simple matter, because there is no generally accepted definition of the term and a lot of different flowers are blooming, all calling themselves “cowork spaces”.

To explore this, I have started to amass a dataset of coworking spaces visible on the web (which likely will be a comprehensive sample).

To start the process, I worked through two somewhat dated ‘top twenty’ lists,

These lists turn out to substantially overlap, giving a set of 29 coworking spaces in 18 US cities. This is not comprehensive.   I know that there are plenty more out there. But lets start here. I’ll add more as I have time.

There are lot’s of questions I can ask with this dataset. For example, what are the range of facilities and services that appear to be offered?

Equally important, in many cases there is quite a lot of attention to the social structure, AKA the “community” in the space. These communities vary quite a bit. If you’ve only looked at one or two coworking spaces, you may be surprised at the variety that can be found.

I also wonder about the relationships among multiple coworking spaces in the same city. In some cases there are alliances among different spaces, but there is obviously competition. I suspect that the design and “vibe” of the community may be a distinguishing factor when there is a competitive situation. A space down the block has lots of (noisy) game programmers? Let’s focus our space on artists and writers (e.g., with shows).

I’m developing evidence on these and other points.

Today, I wanted to post a short note about another question. I am trying to understand the business model and sustainability of these spaces. It is easy enough to open one, but what do you have to do to keep going?

As a first data point, I’ve collected the opening date and, for five of the 29 (17% since 2012/2013), the closing date. The earliest start date is 2002 (still going!), a large number starting 2011 (what happened that year to trigger this explosion?) The average lifetime is 6 years, though this is pretty meaningless with so many spaces opening in 2011 and still operational (which I count as 6 years of operation).

Figure 1. Operational Period for Sampled Coworking Spaces
Figure 1. Operational Period for Sampled Coworking Spaces

From this small sample I don’t see too many trends.  New York City seems to have the oldest and earliest coworking spaces.  San Francisco has the fastest failing.

Naturally, this is not in any way a systematic sample. How many marginal spaces opened and closed and were never in any “top 20”? I know of one or maybe two such cases within a kilometer of my house.

That’s what I have for now. More later.


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