The spurt in the entrepreneurial ecosystem and growth of the gig economy first created a demand for co-working spaces. Now, the conglomerates and MNCs too are moving out of their traditional office set-ups, triggering the next surge in their popularity.
The actual use of the word “coworking” in relation to a shared office environment was first used by Brad Neuberg in 2005. He was an intrepid entrepreneur who created the first coworking space, as we know it today, in San Francisco.
Now a global phenomenon, coworking spaces are popping up in most major cities. It is predicted that there will be more than 30,432 coworking spaces and over 5.1 million coworking members by the year 2022. (Source: Emergent Research)
Coworking spaces are essentially shared workspaces. They offer affordable office space for those looking to escape the isolation of a home office or coffee shop. These shared workspaces offer a suite of office-like amenities such as hot-desks, private meeting rooms, kitchens, coffee and more.
But coworking is not just about the sharing of infrastructure, cost and amenities -it is a new way of working and sharing. The spaces are designed to provide a productive and collaborative ecosystem for their dynamic inhabitants, and created without corporate constraints on what is perceived to be an “office” environment.
When most people think of coworking compared to other types of offices, they think of the sense of community that comes from these spaces. While many coworking spaces do enjoy a sense of community, that is not always true. There are actually two main types of cultures for coworking spaces, focusing on either a community or a corporate atmosphere.
Spaces with a community atmosphere are those that encourage collaboration and host events with layout designed keeping the community in mind. These may be spaces that appeal to all types of members or those that fit a particular niche.
By contrast, spaces with more of a corporate feel focus on the space and the amenities instead of the community.
Those in the co-working space business attribute the shift to coworking to an expensive real estate market and the ease and swiftness of setting up a new office with a plug-and-play model. “In a traditional office space, companies need to deal with landlords, brokers, contractors, security deposit, lock-in period and other legal and technical issues. The process is extremely time-consuming and takes months from the time companies start looking till the time they move in. We, on the other hand, are more flexible and take care of all these hassles so companies can set up and start working in a matter of a few days,” says Rahul Agrawal, founder of Workspace – a coworking space in Bangalore and Pune.
The major draw for big corporates is that “…they can leave the burden of managing the space on the coworking players. More importantly, leasing real estate for a long period goes on the company’s balance sheet as a fixed asset and a liability. Instead, when you sign up for a co-working space with the right to terminate, the CapEx on the company balance sheets changes to an OpEx. So, even for a big corporate, working from a co-working space turns out to be better than having their own office”, he continues.
The reasons, however, go beyond capital and convenience. The corporate workforce, much of it comprising millennials, benefits from the vibrant design and environment such spaces have meticulously created. The healthy, relaxed atmosphere in co-working spaces helps companies retain their employees, who report an enhancement in work-life balance and an improvement in personal and professional relationships due to the emergence of an ideal third space between work and home.
Coworking spaces have been harbingers of big changes for corporate India. For one, the atmosphere is vibrant, buzzing with energy. Moreover, co-working spaces are great platforms for informal networking and collaboration as one keeps bumping into executives, entrepreneurs and freelancers from different sectors.
Coworking is the new path of melding life and work in a sustainable fashion. It is the global linchpin at the intersection of real estate, technology and community, which will shape the way we work in the future.