How to Start a Co-Working Space Business: Step-by-Step Guide
With the Covid-19 pandemic, the world changed drastically, and businesses were affected the most. They faced challenges that forced them to adapt and completely change their function. Big companies like HSBC, Microsoft and Dell are leaning towards staffing their employees in a co-working space.
Now with the new regulations that businesses have started to take, the workforce has become primarily mobile, and people are shifting into more flexible work models such as choosing their work schedule. Yet, the need for a sense of community has increased because of the pandemic. Day by day, co-working spaces become more essential for organizations. Experts suggest that with this rate, co-working spaces will grow 30% by 2030.
Co-working spaces are the future. They have guiding principles of collaboration and a sense of community and aim to connect with like-minded people. However, these alone can’t determine the success of a co-working space. If you are curious about jumping into this lucrative business, here is a step-by-step guide.
What is Your Intent
In theory, starting a co-working space is a highly profitable business. However, the desire to own a lucrative business won’t guarantee you success. You need to think hard and determine the real reason you want to start a co-working space. Is it to make a living? Is it to be a part of a creative environment? Is it to be part of a community full of talented people? Find your purposes before determining the building blocks.
Focus on a specific community
Do you want to build a coworking space for individuals that work in the lifestyle niche or maybe a coworking space just for freelancers? Best way to decide and make sure you pick up a place where there is demand. The odds will be in your favour if you can niche down to a specific community you want your coworking space to address. There are a couple of things you can do. First, search through online communication for some particular industries you have decided on. See if there is a demand. Visit popular coworking spaces and talk with people, ask them questions you cannot figure out on your own. Remember, if you aim to be everything to everyone, you will most probably struggle to deliver a consistent marketing message, causing you to lose your appeal. Aim to get to know your prospective audience well.
Pick a location where there is a demand.
Location can make or break a coworking business. It would be best to avoid overly crowded areas with more coworking spaces than needed. Also, it may not seem like it, but your selected niche is closely related to the location. If you choose a niche better suited to a central business district, that’s your spot. Here are other things you need to consider:
- How many competing spaces are in the area?
- Is there a high instance of people working from cafes?
- Is there a public transportation and/or parking space?
- Is it close to restaurants, coffee shops, retail stores and bars?
- How is the lighting in the venue itself?
- Is there enough space where people feel comfortable in terms of personal space and privacy?
Check Out the Competition & Do Your Research
The market for coworking space is growing rapidly and is one of the most dynamic in the commercial real estate industry. It’s no wonder that there are some severe competitions to face. No need to panic; where there is competition, there is an opportunity to learn. Look into how big companies became this industry’s leaders. What did they do differently? Go in-depth and see each fragment of information as a step toward success. In which way does some other fail?
Prepare your Business Plan
Any wise business involves an elaborated business plan. As for any plan, it is vital to do in-depth research. Ask people involved in the coworking space business and do some interviews to determine what your expenses will look like and how you can avoid waste. Here are a couple of other questions that need to study:
- What are the costs involved in opening a coworking space business?
- What are the ongoing expenses for a coworking space business?
- How does a coworking space business make money?
- How much can you charge customers?
- How can you make your business more profitable?
And here are some more points you need to consider for financing:
- Marketing Budget
- Government Regulations
- Launch Day Plans
- Business Structure
- Business Revision
Gather Necessary Licenses & Permits
The licenses and permits you need to form your business officially may change according to your selected location. Try to gather them as soon as you can. Make sure to research it thoroughly. Talk to other business owners and create a checklist to ensure you don’t miss anything vital. Remember, there is no shame in asking for help.
Interior design on its own is a crucial step. First impressions are everything in up-and-coming business, and when your customers enter your coworking space, interior design will be the first thing they will notice. They’ll decide whatever they like about your business based on essentials like interior design and furnishing in under a minute. In addition, it will be none of the things that will separate you from your competition. Try to create a mix of open plan temporary ‘hotdesks’, permanent desks, brainstorming spots, private team spaces, and quiet spaces. In short, you should aim to provide everything that your customer may need.
It’s never easy to dive into a new business. Yet, it’s even more complex when a company is as famous and rising as coworking spaces. That’s why meticulously planning is crucial. Knowing the business cycle and being aware of industry trends is essential. We hope that this guide will help you in your journey.
If you want to learn more here is an article on coworking spaces in London.