How Coworking Impacts Innovation for Startups and Small Businesses in the U.K.
Grow Your Business, Not Your Inbox
There is no doubt about it -- coworking is big business.
From those of us who choose to cowork when running a remote team, to startups building an enterprise and large corporations offering flexibility and autonomy, the growth of the coworking market shows no signs of slowing down. Far from it, in fact.The figures are astonishing; according to a Global Coworking Unconference Conference forecast, by 2022 there will be 30,432 spaces and 5.1 million paid coworking members worldwide. The market shows an average annual growth rate of 24.2 percent since 2007, and is less a way of working now than a way of life.
So, what's behind the explosion, and what does it mean for the U.K.?
The benefits of coworking are myriad. As demands on workplace flexibility continue to increase, corporations are turning to coworking to solve the problem or rising real estate costs and the need to stay agile. Steven Hess of Startup Leadership told me via email, "It is an amazing, open and supportive environment for those who [are] not ready for their own office or enjoy the flux and energy of shared space." -- it is precisely this flexibility that is so attractive for small businesses as they build.
The self-employed knowledge worker sector is growing too, bringing with it the need for hubs to provide social interaction, alternative locations than the cramped office desk or coffee shop, and clusters of interaction for connectivity.
For startups, the coworking solution ticks all the boxes of flexible, affordable space, and a creative hub to foster new ideas and new business.
In the U.K., coworking is at the heart of innovation and growth for small businesses and startups, and it's here to stay.
Coworking giant WeWork arrived in London in 2014. The so called "decacorn" company -- that is, a company valued at $10 billion or more -- currently has 17 WeWork spaces in London, with 10 more set to open, and is about to become the city's largest private landlord of office space, according to data compiled for Bloomberg.
So, if this market continues to grow and thrive as all the signs indicate, what is the impact on innovation in the U.K.?
To quote professor and author John Bessan from a recent Telegraph article, businesses need to "create an atmosphere where creativity is welcomed, by making people feel like they can deliver an idea, and that it's safe to share their own and link up with others.".
For innovation to be successful, the ability to bounce ideas and to foster a culture of creativity and ideation is only part of the picture.
Collaboration is also crucial to innovation, and it's precisely this element that coworking provides. The need to build links has always been a key part of business, but open innovation speeds up development; this means networking with people both inside and outside of your organization, making coworking a clear contender.Coworking opens up spaces to develop communities, too. As Rishi Chowdury, co-founder of IncuBus Ventures and Momentum Startups, tells me, coworking has "opportunities for collaborations between disruptive tech startups."
This is echoed by TechHub co-founder Elizabeth Varley, a business friend whom I met through networking many years ago. She told me via LinkedIn how important it is for startups to be motivated by other creative, dedicated people, which is "one of the great benefits of working in a shared space".
This networking and open source approach is not without limitations and challenges, however. Steve Hess notes that the propensity for coworking spaces to become an "echo chamber" is a factor to be aware of. When businesses immerse themselves solely in any one network -- online of off -- the echo chamber effect can be damaging.
Some entrepreneurs avoid this by deliberately switching up the spaces they choose to work in. The founder of Araminta Marketing, Araminta Sheridan, told me via email that she varies how she works with her team: "We spend three days a week in an office (actually a flat that we use as an office), one day in a coworking space and one day working from home so we get the best of all worlds." This is an approach I take myself, mixing up my remote working, coworking and office space environments to access different networks and to help spark creative ideas.
Some coworking companies build in collaboration with a specific lens and strategic focal part as part of their offering. As Tom Ingham, of All Work and Social, explained to me via Twitter, "The benefits of an industry focus, combined with a flexible workspace environment, is that companies of all sizes can learn, share and collaborate."Creating an incubator culture through coworking also has an impact on the speed of growth and success rate of startups. Coworking members grow through collaboration with the space operator where opportunities allow.
This gives startups the chance to showcase their businesses to a wider audience that they may not otherwise have had access to.
Jacob Fisher of Runway East told me via email that coworking helps startups to fail faster, which is crucial to innovation. "Startups fail slow when they're alone and can't see the wood from the trees. They fail fast when they have access to impartial and well intentioned feedback from fellow coworkers."
Creating the introductions for collaboration and innovation is also built into some coworking models. Growth during the early stages of a company often relies on introductions to new clients or contacts, all of which take precious time out of your day to create those connections if you are working from a coffee shop or private office. As James Parton of Central Working told me via email, "A top-tier shared office provider will know your business model and growth ambitions so will actively make these introductions on your behalf, alongside delivering a rich and compelling program of events and mentorship opportunities"
By creating introductions and helping to build networks, entrepreneurs have more time to focus on innovation -- which is often the part of running a business that motivated them to run their own empires in the first place.
For startups in the U.K., coworking offers many components that are essential to innovation: collaboration, open network input, a safe space for ideation and in many cases, mentoring and support. As the coworking model continues to explode and diversify in the U.K, we can expect to see more opportunities and models for startup open culture innovation around the country.
So, whether you are based in one space and making the most of the connections you make, or hopping between environments, coworking has many benefits for U.K. startups.