Coworking spaces are started for many reasons. Many struggle from the outset because the intent is misplaced. Those spaces without the piles of cash required to weather the storm go under making zero impact. To ensure your long-term success and deliver great value to others, make sure you start out with the right mindset: focus on the ecosystem around you.
The content of requests for advice, emails, and LinkedIn messages I receive from would-be coworking founders often have a similar flavor. Here’s a taste of a few:
We want to build a coworking space in our town (alt. city, village, school, office, resort, hotel, etc.), but don’t know how to pull it off. What should we do?
I own a newly remodeled building that would be great for a co-working space (location undisclosed). Do you know anybody who I should get in touch with that might want to do it?
There’s a huge old brownstone in our downtown area that’s been empty for 30 years. It would be absolutely perfect for a coworking space! But I need funding to pull it off. How can I convince them (insert local council, landlord, sponsors, etc.) to pay for it?
On the surface, each of these appear to be different. But they all share one thing; a critical error in judgment that will likely cause them to fail, or worse still, to never launch in the first place. Each of these would-be founders is lacking an ecosystems perspective.
But before we get to that, let’s talk about the space itself.
The box you pick in which to build your coworking space is not the important part. The space is only a shell, a vessel, a container for other things. The space can contain something profound or something banal, regardless of shape, size, or other physical attributes.
I’ve been to coworking spaces with absolutely gorgeous exteriors and interiors and furniture and decor, with all the fancy bells and whistles you can dream up, but which felt totally dead inside. On the other hand, I’ve visited spaces in nondescript buildings in unremarkable parts of cities that were teeming with life and vibrancy.
The space is just a space, nothing more.
Coworking spaces do not exist in a vacuum; they are part of a more extensive network called an ecosystem. You’re welcome to use the words neighborhood or community instead of ecosystem if you like. I prefer using ecosystem because I think it properly conveys the big picture and the importance of the individual elements as they interact with each other.
Every dynamic and vibrant town or neighborhood has, by some miracle of luck or hard, gruelling work, cultivated a healthy and functioning ecosystem. Recall the places you've loved visiting or living in your life, and you'll know what I'm talking about. Think back on the cities you’ve visited and found yourself thinking "wow, this is a cool place. I'd love to live here!" That's an ecosystem in action.
Ecosystems are made up of ecosystem actors. These are the people and the organizations who affect the functioning of the ecosystem itself. And sure, these ecosystem actors can include one or many coworking spaces. However they also include elements such as cafes, community organizers, neighborhood associations, meetups, bartenders, politicians, freelancers, musicians, artists, entrepreneurs, event venues, nonprofit organizations, bakeries, sushi restaurants, business parks, lawyers, families, young adults, students, universities, art galleries, and so much more. An ecosystem actor is inherently neither good nor bad. They just are. Ecosystem actors can contribute to the growth and liveliness of the community, they can be neutral, or they can sap the energy and momentum from it.
Imagine a cafe that everybody loves to go to for working, relaxing, meetings, and generally hanging out. Yes, the coffee and food are fantastic, but what's more, the owners genuinely care about their customers and allow community members use the cafe for charity events, open mic nights, festivals, and art exhibitions. The owners think about their space as an anchor in the neighborhood, and they love being the hub of activity for passionate people. Over the years they've consistently thought, "how can we do more? What else could we use this space for? How can we support others in our community?" The owners, along with their cafe, are ecosystem actors.
One of my favorite, albeit seemingly odd, examples of an ecosystem actor is the Bristol Board Games Meetup in Bristol, UK. This group has nothing to do with business, nothing to do with so-called community, nor does it gather inside a coworking space. That said, it attracts a core group of individuals who all passionately share similar interests and many who, perhaps-not-so-strangely, share related professions in IT (gaming tends to draw us nerdy types). The existence of this group is one of many other signs that the ecosystem in Bristol is vibrant and healthy.
On the flip side, cities which don't have gathering places or gatherings of engaged people are likely neither vibrant nor healthy. The lesson here is that passionate people have more impact when they gather, and the gatherings can happen anywhere. The location is irrelevant.
The advice-seekers from the outset of this article weren’t thinking much about the ecosystem. Instead, they are preoccupied with specific things like fame, influence, or money. But most are just excited by the coworking trend. “This will be so cool!” they think.
But being cool isn’t the point. The point is to build a successful coworking space (assuming that’s what’s needed in your ecosystem at this moment). And that said, the coworking space is also beside the point. Consider instead the reason for which you’re building the coworking space in the first place. That purpose is your true and ultimate goal, your North Star.
Coworking spaces can catalyze nascent or burgeoning ecosystems; they are not the genesis of them.
Which means the all-around best way to assure success for your fledgling coworking space is to focus on building the ecosystem first.
Start by identifying the ecosystem actors in your city or ‘hood.
Are you one of them? Do they even exist?
If you're struggling to find ecosystem actors worth their weight in gold, then that could be a sign that your town just isn't ready for a coworking space. Instead, focus all of your time and effort on building the city into the place you want it to be. This type of work takes time, whether that’s months, years, maybe even decades. If you're not up for that, nobody will fault you if you move somewhere that's a little further down the ecosystem development road to have more leverage and impact.
On the other hand, if you do find the ecosystem actors you're looking for, consider these questions:
Do you really know them? Personally? What do they need? Who’s on the sidelines that should be on the front line? Can you help them get there? Who’s lacking resources or connections or influence that could benefit from your help? Do you have said resources, connections or influence? Will you give it to them?
Set about becoming an ecosystem actor yourself by contributing to the ecosystem as it exists today. Doing so doesn't require funding, nor does it require a large brownstone building in the city center. It requires putting your heart and mind to work toward making your block, street, neighborhood, or city a better place to live, work and play. It means getting to know the people already in the arena and showing up to inspire them, or fight alongside them.
Does this process sound too fluffy to you? Perhaps it does for many. However, even if you don’t care about all this ecosystem stuff, there’s a solid business case for focusing on the ecosystem first before building your coworking space. Contributing to the ecosystem generates influence and builds your reputation, which are two incredible resources to have in your vault when the time comes to grow and sustain a coworking space. So, if you have to, consider the fluffy stuff a marketing investment.
Once you, along with the other ecosystem actors, have developed the ecosystem to a sufficient level, you’ll just kind of feel it. You’ll find yourself deciding which event to attend on a Thursday evening instead of praying that at least a few other people even show up. You'll find your favorite cafe (the one with reliable, fast wifi and great food) is filled with people working and meeting. It’s too full in fact.
This quote from Field of Dreams circa 1989 is widely regarded as untrue for every business on the planet. The same goes for coworking spaces. However, this moment is the one exception. Once you’ve built the ecosystem, then build your space, they most likely will come.
This article won’t cover in detail what to do at this stage, as I and many others, have already written volumes on the nuts and bolts of organizing, marketing, launching and managing a coworking space.
Suffice it to say, your next step is to leverage the reputation and influence you’ve generated over the last several months or years to launch your space. Work with the community, of which you are now a valued member, to ideate, plan, promote, and launch the new home for that community.
No ecosystem lecture would be complete without a brief dive into Game Theory, notably finite versus infinite games. Understanding finite and infinite games is critical to creating a lasting impact and ensuring your space isn’t only a flash in the pan. Let’s start with a true story.
In 2014, at Impact Hub Salt Lake, we woke up one day to realize we had three new competitors entering the market at nearly the same time. A local university was behind one space, our city's government supported another, and the other was privately-owned. On top of that, an existing space was in the process of doubling every year like clockwork.
We did much of the work of educating the market on this new coworking thing. We even presented our model to the city to obtain some extra funding, so imagine our surprise when they backed another group, essentially opening their own space after we had disclosed IP to them. NDA's be damned, I suppose.
Two of our founders went to bat, threatening to sue the city.
However, it turns out the story about the city-backed coworking space wasn't entirely accurate. The space was in a city-owned building, but the people behind the coworking space were paying rent. Low rent, but still rent. Their organization was partially funded by city money, but it was through a grant program that backed other organizations too. They and the city had a long-time relationship with one another. While they did secure some extra funding to run a low-cost (and therefore subsidized) coworking space for entrepreneurs on a budget, this narrative was far from that of the government stealing our IP and launching a space to compete with the private sector. With a better understanding of the reality of the situation, the founders withdrew the suit.
But the withdrawal was too little too late. Blood had been drawn. People took sides. Important people. Angry people.
Perhaps those two founders were justified. After all, the end of our runway was looming, construction on our new location was way behind, and revenues were a small black blip in a sea of red. Justified or not, the founders were stuck in a finite game. That is, a game in which there is a conclusion, and end goal, and only one or few winners.
On the other hand, I was more interested in an infinite game in which there is no end goal, there are no winners, and the only real goal is to keep the game in play. I'd discovered coworking, and I wanted to keep this thing going because I loved our little city so much.
So, somewhat in response to the backlash, I created the Salt Lake Coworking Coalition. I knew it was better to sit at the table, clear the air, and develop our ecosystem together. I figured it was better to build and educate the market as a collective, rather than squabble over the small pie that was available. I did it without permission, without funding, and somewhat to the dismay of my colleagues.
I remember lying to my team about the nature of my meetings, which were with the various coalition founders before its formation. It was tense. People didn’t know if they could trust me. They certainly didn’t trust my colleagues. But I assured them I had good intentions. I met them on their terms, on their level. I vented with them, laughed with them, shared the struggle with them. “We are all in this together,” I told them.
We began marketing coworking in Salt Lake City together and referring potential members to each others’ spaces when it made sense to do so. We even marketed and hosted a coworking pub crawl with all of the spaces from the coalition. Our relationships, for the most part, were repaired. And Impact Hub Salt Lake survives to this day.
I'm not saying what I did saved our asses. The two original founders, one in particular, deserve most of that credit. But I do think it created a significant shift in our relationships with other parties, which likely made people more likely to work with us, and more likely to want to be a part of our brand. We started taking an ecosystems perspective and began thinking beyond our walls.
If you dream forward to the furthest point in your coworking journey, what do you see?
A big coworking space, filled with awesome people, collaborating and making an impact?
A big launch party that attracts hundreds of the city’s coolest people?
A big profit?
If these are your dreams, I've got a wake-up call for you.
That’s because these are the dreams of the finite game. Instead, be like Matthias and Uwe.
My friends Matthias Zeitler and Uwe Allgäuer are the co-founders of Coworking Bansko in Bansko, Bulgaria. Bansko is a small village of 8,000 residents which attracts double that number during the winter skiing season. Their vision is clear, “We want people to move here and have babies.”
You might be laughing at this point. What a strange vision for a coworking founder to have, but it’s true. “We want people to move back to the villages and enjoy a much better quality of life,” Matthias told me, “such as here in the beautiful Pirin mountain range.”
And, of course, he’s right on point. He’s on point because his vision goes beyond that of his coworking space. It includes the ecosystem at its core. To him, Coworking Bansko is merely a tool in his impact tool belt. He sees the coworking space as a means to an end that will keep him in the game for a very long time, perhaps forever.
You can see this vision in nearly all of the decisions made by the team, from the events they host to the rules they outline for the space itself.
They are not without their mistakes, of course. But at every turn they try to gather feedback from the community and improve. And all this effort is guided by their vision to get more people to Bansko, and build the larger community for the better.
And the results are pretty interesting.
Bulgaria, like many countries in the Balkans, has been at the mercy of "brain drain" for a long time now. Brain drain is the process by which the region's most educated, and often talented, people emigrate out of the area. It's a massive problem for developing economies. The Province of Blagoevgrad, which includes the Municipality of Bansko, as well as several cities much larger than Bansko, only netted about 80 new residents last year from the EU, which is extremely low.
Here comes interesting part.
Since its opening in Winter 2016, Coworking Bansko has directly resulted in 22+ new residents to Bansko alone, plus many more long-stay digital nomads and location-independent workers that repeatedly return to the city for up to three months at a time.
These are smart, educated, collaborative, impact-oriented people and they are changing the village for the better. They are renting some of the abundantly available apartments that sit empty for eight months out of the year (due to Bansko's seasonal cycle), putting market-rate rents into the pockets of locals. They buy at the local markets, which mostly include produce grown in neighborhood backyards and nearby farms. They purchase the apartments that were way overbuilt in the lead-up to the 2008 crisis, freeing many locals (and foreigners) from their untimely investments. They host workshops and events, facilitating skill sharing and idea exchange among the community. They connect with local business owners and sometimes partner with them on projects or activities. They treat the locals with respect. And over time, they become locals themselves.
These results aren’t atypical for ecosystem-focused, infinite-game-playing coworking founders. They are a direct result of taking a long view on things and recognizing oneself as part of something bigger than a box filled with desks and chairs.
In my opinion, the only reason a coworking space exists is to facilitate a positive impact. That impact can only be realized by people who are in it for the long haul. It doesn't matter how many corporate competitors open up in your town or who gets funding from which NGO's, governments, or investors if their intent is wrong.
So long as your intent is long-term, you will win. With or without a space, if you care about your ecosystem, play the infinite game, and pour your heart and mind into the work, your vision will most likely be realized.
Marketing Director, founder at Coworking Insights, coworking maven, digital nomad, lover of wine & tacos.