2009 is Coworking’s Perfect Storm
I hate the phrase “the perfect storm”. I also feel like it’s exactly what’s about to happen around coworking.
In 2006 there were only a handful of coworking and related alternative workspace facilities. There were over 70 spaces worldwide by the end of 2008. Based on the volume of discussion and the number of new spaces online since the beginning of 2009, I predict that there will be 200+ coworking spaces worldwide by the end of 2009.
Here’s one data point to chew on. One March 9th, I went to Jelly NYC, which was being held at Treehouse Coworking in downtown Brooklyn. Brooklyn already has Williamsburg Coworking, one of earliest coworking spaces, and Ditmas Workspace which opened in Ditmas Park in 2008. Since then, I’ve learned of concrete plans to launch two more spaces in Brooklyn. Then there’s Manhattan, Staten Island…
Why the sudden interest?
A lot has been written and said about two important drivers—work that can be done anywhere (design, software development…) and technology that allows workers to work anywhere (laptops, wifi…). I believe there are two more drivers that are more important but that haven’t been given as much attention.
A year ago, I wrote Coworking as Catalyst, and described the impact that coworking will have on business. But I failed to see the impact that business—specifically the current economic crisis—would have on coworking.
One factor is access to real estate. Coworking depends on physical space, and as Drew wrote a few weeks ago, there’s never been a better time to negotiate.
The second factor is the job market. Layoffs started in earnest the last quarter of 2008. Many of those affected have had time to look for another job, reconsider (either begrudgingly or not), and take steps toward independence. Life as a new independent worker is challenging—coworking provides a support system comprised of people and place that offset the office.
If only a small percentage of the millions laid off start coworking, the impact, in terms of numbers, will be tremendous.
Todd
3 Comments
Free Agent Jungle Online Roundup for March 26, 2009 | Free Agent Jungle on March 26th, 2009
[...] Sundsted, co-author of coworking book “I’m Outta Here”, predicts coworking spaces will increase from 70 to 200 by the end of [...]
Todd Sundsted on March 28th, 2009
Enjoyed the comments, Alex!
Some/many will fail, where fail means “cease to operate”. Probably in the 2010/2011 time-frame, rather than in 2009. Some of that will be the result of conscious decision to close shop, rather than a catastrophic failure of some kind, if the patterns hold true to small business failure.
The key is the incredible opportunity to innovate with the coworking model, as well as to benefit from the investment into supporting tools and frameworks.
I’ll throw out another prediction. Starting a coworking space at the Spiral Muse in 2005 was an immense challenge. Starting a coworking space in 2010 is going to be much easier, because there will be mature business models to learn from, and tools (reservation systems, payment systems, etc.) to automate some of the work.
These forces will reduce the risk in opening up a space.
Drew Jones is an anthropologist, management consultant, and former business school professor. He works with 
Alex Hillman on March 23rd, 2009
I hate to be negative, but the realist in me wonders how many new coworking spaces will fail to find the median of sustainability in 2009, or worse, into 2010 and 2011 and beyond.
While the curves of the real estate market and the job market are known to be temporary reactions to global economic climates, I am watching the volume of new spaces open with the intentions of benefiting from the conditions you’ve described, and see very few of them operating on models that cannot – and will not – sustain in the long term.
200+ coworking spaces opening in the next 12 months is probably accurate. The biggest benefit to this growth is the opportunity for some colossal failures.
Why is that important? Because in order for coworking to be adopted into mainstream, every success that deems coworking as “the perfect solution” needs to be balanced by significant fuckups in the models.
We can write our own textbooks, but in order for others to write about coworking in their textbooks, we need a balance of successes and failures in the history of coworking spaces.