Co-working spaces save money and offer collaboration opportunities for startups looking to get their ideas off the ground, according to the heads of startups and co-working spaces in Australia.
“I think there’s something deep within people that enables you to work better and harder when you’re around hard-working people,” says Joel Hauer, founder of WeCo, a co-working space in Sydney’s Eastern Suburbs.
“The fact that you can come to an environment that is not only a place to work, but helps your business grow due to the fact that you’re in close proximity to other like-minded people provides a significant boost to your business compared to a cafe or home.”
Tank Stream Labs, which houses about 20 startups in the Sydney CBD, typically attracts startup teams of four to six people with an average company age of one-and-a-half years, says the co-working space’s marketing officer, Balder Tol.
About 95 per cent work out of Tank Stream Labs on a full-time basis, he said. He says there is an even split of companies that used to work from home and ones that had a private office.
"People just love the interaction and especially referrals" to clients and potential business partners, says Tol. "That network is probably most important."
Networking has been a major benefit of co-working for Roller, an online night club booking service, says Roller business development head, Will Nicholson. Roller uses the WeCo co-working space as its Sydney office. The startup also shares office space with a few other companies in Melbourne.
“We’ve made at least two partnerships from our time in WeCo," says Nicholson. "It’s the easiest way to expose your business is to talk to other people about. Everyone knows someone."
Roller wanted an office environment to keep staff focussed, but price was a problem, he says. “It just wasn’t feasible when you’re counting every single dollar that goes out the door to take on a lease or a commercial property.”
Co-founders Alexandra Kinloch and Ben Rashleigh of video app developer Cinch (formerly CaptureUs) met at the York Butter Factory co-working space in Melbourne.
“We decided to stay on to run the company because the space provides an easily accessible work space with networking opportunities,” says Kinloch.
Co-working spaces provide a roomy work setting at a reasonable price, she says. “When you're a startup you can't afford a private office, so it is more cost effective. Working from home is unrealistic when you have a team of five people [and] a co-working space provides a place that is accessible to everyone as it is located in the city.”
Hear Here Satellite Narration, a startup specialising in location-based audio tours, moved into the WeCo co-working space after a stint working from home. Co-founder Rob Marjenberg says startups in co-working spaces get more respect.
Working from home is “not great for your self-esteem,” he says.
In three months, Marjenberg says he has already benefitted from working in close proximity to other startups. Recently, when he needed someone to do app development, another startup in the space volunteered to help. The two companies have since entered a joint proposal for a project, he says.
While co-working spaces provide benefits to startups, there will come a time in a business’s life when it’s time to move out.
“When a team goes beyond 15 [staff], it makes more sense on an economic basis to move into their own office,” says Tol. “It creates a little bit of a block within the community because you have such a big team interacting just within themselves.”
Roller could eventually move into a private office, says Nicholson. “If we were to grow to the scale where we could afford to have our own offices, yes we probably would.”
Nicholson says the cross-pollenisation among companies that occurs in a co-working space can become a downside as a business expands. “We would want all of our employees oriented purely around our business.”
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