Abacus: New Frontiers In The Nomad Economy — Co-Working Spaces

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Metropolitan residents pride themselves on their ability to utilize any and all resources. Bulletproof formulas for efficiency are what straighten out the chaos for bustling businesspeople for their day-to-day lives. The rise of start-up culture has formed an efficiency problem in finding suitable work areas for start-up employees to convene. Enter: Co-Working spaces.

Imagine all the restaurants that have late starts to their day; many will open their doors only after 5:00 p.m. Till then these atmospheric spaces remain empty. Some may call this blatant underutilization. Entrepreneurs such as Chris Smothers and Preston Pesek, the cofounders of Spacious, sought out to transform these empty spaces. Their solution was to offer work spaces for small business that beat the bleakness of a regular office. Spaces where entrepreneurs could allow their creativeness to remain unhampered by flickering overhead lights or whirring printers and scanners. It goes against the psychological presumption that humans yearn to own their spaces, not just exist in them. However, as millennials are using apps such as Uber and AirBnb, it is becoming apparent that the ‘owning’ factor just is not as important as it once was. From a movement to industry, rentable work spaces that offer new surroundings and amenities just seems to be in line with the ongoing trend.

Spacious is one example out of many. Members pay $129/month or $99/month for an annual membership to have access to all of the company’s locations. The company began working out of acclaimed and upmarket restaurants in New York City such as Public, L’Apicio, DBGB Kitchen and Bar, and La Sirena. This allowed for the perfect test run to see whether this concept could be replicated in smaller, local restaurants. Other companies include Kettlespace and WorkEatPlay in New York City, CoworkCafe in Arlington, Birdnest in San Francisco, Switch Cowork in Austin, TwoSpace in Australia, and many others. Co-working spaces usually offer coffee from local brewers and perhaps some other snacks, depending on the membership. Like any good company, most offer some on-site customer service: Spacious has two hosts at each location to aid and facilitate the co-working spaces.

Members find available work spaces using the company’s app and websites, which can give members informations regarding availability, last minute changes, or just general information. Individuals can then settle into their work spaces by using a table for individual or group work, booths for private calls, interviews, or conferences, and bars for casual interactions. Some companies even offer private conference rooms for an additional charge ranging from $50 - $200.

The co-working industry has been growing at an average annual rate of 23% since 2010, and had a revenue of $10.9 billion in 2013. Spacious received $9 million in venture capital just in May. According to JLL, 2017 Q2 saw 51.2 million square feet being dedicated to co-working spaces. The investment management company’s research claims this industry is “unstoppable,” and rightly so. Small Business Labs predicts that 5.1 million people will be using co-working spaces by 2022. With the predicted increase of entrepreneurs from a third of the population to half of it by 2020, this industry is not only meeting demand, but also anticipating and gearing itself towards it, too. Co-working companies pay part of the profits from their membership revenues to the hosting spaces; thus, restaurants that usually have small profit margins make some extra money with very little effort on their end. With a win-win strategy, the stage is set for co-working companies to bolster themselves as a staple for start-ups and small businesses. The rising industry could even see an increase in acquisitions of catering and technological services for companies and restaurants.

This new form of nomad economy can come with some side effects, however. One concern about the industry that has not been fully addressed is the risks to the security of intellectual property and to overall productivity. Open restaurant spaces aren’t the most intimate or secure and they do not always offer a concentration-inducing environment. That said, they offer the perfect location for small businesses to interact, network and grow.

Some co-working spaces have been created to suit particular audiences. For instance, The Wing, founded by Lauren Kassan and Audrey Gelman in New York and Washington DC, offers itself to women who wish to co-work in an all-women environment. Clients include celebrities like Remy Ma, and the waiting list is currently at 8,000. The Riveter in Seattle and Make Lemonade in Toronto both follow a similar trend. Similarly, The Assemblage in New York City offers itself to individuals who seek to go back to ancient healing practices, including reiki and yoga, while also offering co-working spaces in a similar environment. These co-working spaces become cultural hubs, ones for spreading ideas and connecting on shared interests.

Perhaps the future of co-working includes small-town restaurants and diners. It is an added asset to the millennial work population with plenty of room to explore and grow. Most suburban markets are unlikely to dive into this concept, nonetheless, as most of the world begins to tap into the nomad economy, you can never say never.