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Does focusing on a niche market improve a coworking space’s success? Or does it reduce the opportunity for cross-polination and network building? As the number of coworking spaces blooms, so to does the range of business models that they use to sustain themselves. Whether big or small, old or new, each coworking space can take some inspiration from different coworking models. In this second part in our series on exceptional coworking models, we look at niche spaces, as well as sponsored & donated spaces and spaces in shared company rooms.
By Carsten Foertsch - Friday, 19 August 2011

1. Niche coworking spaces

Coworkers from different professional groups might have very different requirements, and these can sometimes be difficult to balance in a small shared workspace. Writers like absolute silence, while those in public relations can’t do without their phone. And then there’s fashion designers, with their noisy sewing machines… conflicts can arise that prevent rather than promote cooperation.

One possibility for specialized user groups is to congregate in coworking spaces that cater to a particular niche in the creative industries. In Berlin, a “co-sewing” space for fashion designers called Nadelwald will soon open its doors. Also art spaces like CreativeCity in Wellington and the Brooklyn Artist Gym allow users to be dirty and noisy.

The exact opposite scenario is found at writers spaces such as Paragraph in New York, which bans phones and snacks, and reduces sight lines between desks. With an event area and a large, bright kitchen, there is still plenty of space for collaboration.

And specialization doesn’t just occur along professional lines. In Good Company in New York and Soleilles Cowork in Paris specifically target women, with the aim of strengthening their individual potential and building networks between them.

What can you get out of it?

Coworking works best when it connects people from different professions who could complement each other with their diverse knowledge, support and inspiration. This leads to new ideas, perspectives, bigger networks, a balanced work environment, and improved products and services. Creating a melting pot allows for an innovative ecosystem of cooperation between the community.

Specialized users might be incompatible with other coworkers. Despite the trade-off between cross-polination and diversity that comes with isolating them, it's still better to provide a specialized workspace for them than none at all.

Professionally specialized coworking spaces have fewer opportunities to develop broad-based networks that could otherwise arise between different groups. But they can quickly promote strong bonds between the coworkers. When people from the same field get together, their similar interests allow them to connect more easily. The coworking space can become an entry point into a specialized network. It becomes a visible point of contact for outsiders who want to reach such a network. And, of course, they provide an alternative to the home office.

Another option is to foster specialization within a broader coworking space. Some spaces now offer manual workshops alongside their office work rooms, such as the Open Design City in Berlin at Betahaus or 3rd Ward in Brooklyn. However, a niche coworking space or spaces with internal niches usually only make sense in bigger cities.

Mid-sized companies with coworking spaces

Most coworking spaces are founded by small businesses or freelancers. So far, only a few large companies have tested the idea of opening part of their offices as coworking spaces. Those that have done so realize they can benefit from such a concept. One is the Grup Idea, an architect bureau in Barcelona, which is a medium sized company. Their 25 employees work alongside another 25 coworkers. Their work areas are open to each other, and they all share meeting rooms, a kitchen and an event space.

Grup Idea can afford a prestigious location, with a big event space and a rooftop terrace offering stunning views of the city. But without a diverse network, this space would sit empty. There’s even more to gain than just the income from renting desks.

What can you get out of it?

For existing coworking spaces, this model offers some inspiration when planning an expansion. It also offers some benefits to existing employees who might otherwise be tempted to leap into the waters of freelance work – they can enjoy the buzz of a creative workspace while staying in their job.

In the future, the number of fixed employees in a company is predicted to decline. Offices will become orphaned, their infrastructure underutilized. Why not consider inviting coworkers into such emptying offices? Experienced coworking operators could take over such spaces and make them collaboration-friendly. The company could cut their operational costs with such a model. The coworking area operators would pay lower rent in return for offering desks to the company’s employees.

Not everyone is a freelancer, but even those full-time employees could move into a new work culture without having to give up their contractual security.


Coworking spaces with donations and sponsorships

We’ve already written about some exceptional workspaces that use these two models. Techhub in London and Space 12 in Austin couldn’t be more different, yet they share some similarities. The London coworking space is partly paid for by large technology companies like Google and Telefonica, allowing it to offer lower rental prices and fantastic networking opportunities to its members. Space 12 is operated by a church and runs as a non-profit space that takes donations.

In both workspaces, the area with flexible desks is open only during the weekdays (Techhub also has a separate invite-only permanent desk area). On evenings and weekends in both, the desks are pushed back to make way for events. In Austin, the space emerged as a modern community center hosting exhibitions, concerts, weddings and church gatherings. In London, the space has become a crossroads for the tech start-up community.

What can you get out of it?

Whether functioning as non-profit organization living from donations, or a sponsored space, revenue that comes from sources other than desk rental does affect the nature of your coworking space. You really can’t do it without a large and functional event space.

To ensure the event space isn’t left unused during the day, it’s not a bad idea to offer desks on a flexible basis. Yet a space that constantly packs away its desks at the end of each day can uproot members. It’s therefore preferable that a portion of workstations remain as permanent desks.

The degree to which you need to live from donations or sponsorship will also invariably affect the policies and culture of your space. Yet a blanket condemnation of either revenue streams would be just as inappropriate as an uncritical examination of the issue.

The outcome ultimately depends on the donors and sponsors. The better you know them, trust them, and the more that such benefactors are already aligned to your philosophy, the less chance for conflict. If you seek smaller donations and sponsorships, you’ll have to please a wider base, but you’ll also be more independent from each of them. It's the same as renting out single desk space to your members.


More articles about exceptional coworking space models:

Part 1: Temporary spaces - paying w/benefits - career centers

Part 2: Niches - company spaces - donations & sponsorships

Part 3: Helping members interact

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