Traditional office settings are overrated.
That is the consensus among the nearly 1.2 million people coworking worldwide.
Around 14,000 coworking spaces from Lima to London will be available to choose from by the end of the year, according to the The 2017 Global Coworking Survey.
The once unconventional work medium has proven particularly beneficial for tech startups who find it difficult to accurately predict where they will be revenue-wise 6 to 12 months down the road.
"Co-working spaces are melting pots of creativity. They generate a level of synergy that results from the proximity and collaboration of like-minded people. New relationships are developed. Ideas are challenged. Problems are solved.”
For many tech startup founders, finding the right office space is a difficult task. Balancing the needs of your team against your startup's funding levels, and trying to gauge whether or not you should spend money on an office space or a new team member, can be quite stressful. If you're trying to decide whether or not coworking is the cost-effective office option you have been looking for, this article is for you.
Let's get started:
4 Signs Coworking Is Right for Your London Tech Startup
1. You're ready for an office, but can't predict your growth rate.
First round of funding? Check.
Proven MVP? Check.
Sick of working from Tam's kitchen table? Yep!
You know when you've outgrown working from home. Unfortunately, knowing when to upgrade to a "real office" is a little more ambiguous. Even if your product is 10X better than the competition, there is no guarantee you will continue moving forward at the same pace you are now.
In fact, it's during this stage of a startup's journey that new challenges often arise. Every pound you spend on square-footage could alternatively go toward solving those challenges in the form of hiring a new team member, further developing your product, or upgrading to better forms of technology.
As mentioned in The Rise and Fall of Startups: Creation and Destruction of Revenue and Jobs, new ventures are more likely to fail than they are to succeed. Which is why minimizing burn rate is so important. London startup founders have the added stress of evaluating against some of the highest commercial real estate rates in the world.
While some yearly leasing costs have decreased in 2017 — Mayfair & St James (£98 to £95 per square foot), King's Cross (£68 to £65 per square foot), Midtown (£68 to £63.00 per square foot) — the cost for high-quality space elsewhere has either increased or remained the same.
Unfortunately, London's rental rates aren't expected to decrease anytime soon. If you're the slightest bit unsure about your growth rate, coworking is your safest option.
Want an insider's look at London's best resources for tech startups? Get The London Tech Startup Guide for special insights on the best meetups, events, and venture capitalists for tech startups.
2. You need a foot in the door.
As a startup founder, it may seem like half your time is spent fundraising. When you're not out raising cash, you're thinking about the next time you're going to have to do it!
Interestingly, there is no one way to go about it. Some founders are fortunate enough to begin their journeys with personal connections that help open the door. Others are good at picking up the phone, shooting off an email and getting themselves in front of the people they most want to meet.
But what if you don't exactly fit into either of these groups? In lieu of an existing entrepreneurial network, and a penchant for cold sales outreach, your best bet is tapping into an existing support structure. The right tech-centric coworking space can provide you with warm introductions to VCs, corporate partners, and potential clients you might otherwise struggle to connect with.
Additionally, the best tech coworking spaces have ongoing networking opportunities in the form of weekly workshops, guest speakers, practice pitch sessions, and on-site mentorship. All of these resources have proven extremely valuable to tech founders wanting to even the playing field.
3. Your team is wasting time on admin.
Does anyone on your team love making coffee? How about calling your internet provider and waiting on hold for an hour to figure out what the heck is going on with the WiFi?
If you're a startup, your team likely consists of a few key players. Chances are that each of these individuals is entrusted with a high-level of responsibility for moving the overall vision forward. So, you have to ask yourself: Can you really afford to have any of your all-stars wasting time on administrative tasks if you want to hit your numbers?
If you happen to have one team member who genuinely enjoys the feeling of accomplishment that comes with keeping the bathrooms fully stocked with toilet paper, then do not deprive this person of their fun. However, most programmers prefer to program, and most CMOs prefer to plan marketing campaigns.
Maybe this is one of the reasons individuals report feeling more productive, energized, and creative in coworking environments. According to a Deskmag survey, 70 percent of respondents reported feeling healthier at a coworking space than they did working in a traditional office setting. Relieved of cumbersome administrative duties, and limiting workstations, it's possible team members feel free to explore new possibilities they wouldn't have otherwise considered.
4. Your team is based all over London.
One of the most challenging aspects of leasing office space in London, besides finding something within your budget, is finding a location that is attractive to both current and potential hires. Expecting everyone to live within close proximity of your location isn't always realistic, especially if your building is situated in a more affordable — yet less desirable — part of town.
You may even have team members who prefer commuting into the city because they appreciate the quiet that comes with living somewhere like Kent. For these reasons, you may benefit from choosing a coworking space in central London, thus making it easier for everyone to get to work on time.
Conversely, if you have been managing a remote work team up to this point, it's worth mentioning that geographic proximity has been shown to enhance collaboration. According to a study conducted at Harvard University, findings in 35,000 academic papers indicated that physical proximity mattered after concluding that correlations between the most cited papers and the close distances between authors led to more "impactful publications." Coworking in central London is a great way to get everyone together at an affordable price.
Is Coworking Right for Your Tech Startup?
If your startup meets any of the conditions on our list, coworking could be an ideal solution. Not only does shared workspace allow you to stay flexible, it comes with the added benefit of done-for-you amenities in a superb location.
Understandably, working alongside a wedding planner, a photographer, or an estate agent at a general coworking space can be distracting for many tech founders and entrepreneurs. Which is why our founder, a seasoned tech entrepreneur himself, created RocketSpace.
If you're looking for all the basics (i.e. complimentary coffee, delicious snacks, and fast WiFi) plus introductions to corporate partners, advisors and VCs, look no further than RocketSpace.
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