Co-working vs. Traditional Office: Finding the Perfect Fit for Your Startup
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It's the event you've been dreaming of…opening your first business. Launching your startup is uniquely exciting, but it can also be stressful.
You've probably noticed that coworking spaces, which offer an alternative to traditional offices, have surged in popularity during the past few years. But you'll still need to determine which type of office is right for your business.
We'll examine each of these two very different choices more closely before we compare their advantages and drawbacks.
First, let's look at the history of coworking spaces.
From C-Base to Coworking
The first coworking spaces were created in Berlin, Germany in the mid-1990s. While collaboration was as important to these users as today's coworkers, the initial idea was somewhat different.
Dubbed C-Base, the space was first nicknamed “hackerspace” because of its popularity with computer nerds, including those with potentially illegal intentions. Eventually, C-Base became a legitimate nonprofit organization.
Coworking didn't become mainstream in the United States until 2005 when Brad Neuberg set up the San Francisco Coworking Space. He envisioned workspaces with a sense of independence and community.
For the first month, nobody showed up to keep Brad company, and San Francisco Coworking Space's second month in business only saw one tenant. But when the coworking trend caught on, it did in a big way.
More spaces opened across the nation, with the total number of coworking establishments doubling every year. In 2010, the first WeWork opened in Manhattan's SoHo neighborhood.
Traditional office spaces go back considerably further, debuting in England before the United States became a country. Here's an introduction with a few fascinating facts.
Ahoy, the Traditional Office
While the ancient Romans may have created the first office, it wasn't until the 1700s that dedicated office buildings—some of the first examples of commercial real estate—showed up.
England's Royal Navy inspired the first office building, the Old Admiralty Office. It was built in 1726 to handle business requirements still seen today, such as managing paperwork.
In addition to housing the clerks filing and hand-copying documents (photocopiers didn't show up until 1959), the Admiralty Office had meeting rooms and a boardroom. Today, it serves as the London Headquarters of the Department of International Trade.
Traditional office buildings in the United States first showed up in the 1860s, although they were limited to five stories until elevators were added.
Office design began to evolve in the 1920s, with workers' desks placed in an open space and facing their supervisor. Another major design change arrived in the 1950s.
Dubbed Universal Office Design, this moved managers to private offices, with their employees in open-plan spaces. Cubicle spaces were introduced in the 1960s under the name Action Office System.
Until the arrival of computer technology, traditional offices were generally unchallenged. During the 1980s and 90s, many were redesigned to help retain staff and enhance performance, adding amenities like workout facilities and daycare facilities.
Next, we'll compare today's coworking and traditional offices and identify common pros and cons.
Coworking Pros and Cons
When you review coworking lease options, you'll probably notice that monthly contracts are available. If you expect to expand but aren't sure when, this flexibility could help protect your cash flow.
Depending on the type of business you're running, you may appreciate the communal atmosphere. You may meet new staff and suppliers and your first customers.
If you don't want to spend big on office furniture and supplies, most coworking spaces have everything from meeting rooms to printers available for use.
While flexibility is something almost every entrepreneur likes, other coworking features may not be ideal for your business.
- Privacy may be unavailable. If you offer legal or financial services, or other confidential products or services, coworking may not be your best bet.
- If your business is heavily dependent on a brand personality, you may have little or no opportunities to create office surroundings to support them.
- Amenities such as meeting rooms and printers may not be accessible when you need them.
A traditional office may be a better choice if your business is deadline-driven or prone to impromptu meetings.
Traditional Office Pros and Cons
If privacy is a priority, you may want to check out offices that offer security when you're working and after hours. Your clients will prefer to meet without others walking by or interrupting you.
Want to promote the brand identity you've created? A traditional office space provides the freedom to add your brand logo and colors and to decorate in a fashion that reflects your company's mission and culture.
Setting up your startup in a location that you'll have for at least two or three years provides permanence. This may be important to any investors who are backing you.
You'll also have more control over your environment. If you and your staff prefer to work in quiet, you may be more productive in a traditional office.
In regard to potential drawbacks:
- Leasing a traditional office often requires a bigger cash outlay for everything from deposits to advance rent payments to office furnishings.
- No matter how your business performs during the first years, you're still responsible for rent and utilities.
- While some traditional landlords are becoming more flexible, especially those coping with rising vacancy levels, others may not offer short-term leases. This may not be ideal if your business outgrows the space sooner than later.
- While you may not prioritize networking, you and any staff may feel isolated in a traditional office.
No matter what office you choose, keep these items in mind.
List & Browse Office Space for Free on MyEListing.com!
First, be realistic about predicting your startup's growth. If you're unsure, coworking may help you manage your budget.
Will your clients view your choice favorably? Traditional businesses may benefit from calling a traditional office home, while younger innovators may benefit from the modern look found in coworking spaces.
Last but not least: location. A great deal on an office space isn't great if it's difficult to reach or in a less popular area.
No matter what you decide, you can begin your search right here at MyEListing.com. It's easy and free!
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