Coworking Space. A concept we rarely give much thought about. Neither did we on the nuances of how a shared workspace works. The popularised term began taking form in 2005. However, the concept of shared office has been around for decades.
It is simply a real estate for people who work together separately in a collaborative working environment with flexible office infrastructure.
The operative word here is work together separately.
That means, when you walk into the open office-like space, you will see a handful of people working together. If you were to talk to them, you would find individuals or groups from different companies with many are self-employed.
But, you must be wondering why. Why all the hype and how does it work.
What is coworking?
No man is an island. We are meant to function better as a community. Small or huge, we grow better in various sociocultural environments.
Believe it or not, even introverts will thrive when there’s healthy collaboration. That is why coworking has been around for decades and working pretty well for many people.
Coworking is a style of work in which collaboration with others from different companies and background made possible. The space for coworking or co-living with a vibrant collaborative environment is sometimes known as Airbnb for office space or day office.
Who uses shared workspaces?
The type of people who usually patronise shared office spaces are…
- Mobile Workers
- Digital Nomads
- Fledgeling Startups
- Companies looking to expand into new territory
The coworking community is not just locals, but from around the world as well. To give you an overview picture of how vibrant a coworking community can be, here’s our past data.
ACAT Penang in Numbers
Since launched in October 2015, we grew from 20 coworkers, with nine are foreigners, to 234 coworkers in 2016. 164 foreign nationals and 70 Malaysians, they all come from different countries like UK, Germany, the Netherlands, North America, Canada, India, and many others.
As of today, the coworking space can house over 50 desks with an average occupancy rate of 85%, from over 30 startups or companies. Though it sounded like many foreigners reside at @CAT, however, you’d be surprised that majority of our 40 fixed-desk coworkers are locals. The Coworkers from other countries are mostly digital nomads occupying our flexi-desks.
What to expect in a coworking space?
Typically, a coworking space is meant to be open, flexible and conducive for working, ideating or collaborating. There are many types of coworking spaces today. Some for co-living and retreats for workcation, but mostly for coworking.
Here is a list of what you would typical find in a coworking space.
- Work desk with comfortable chair and proper lighting
- Free Wi-Fi Internet
- Washroom and Showers
- Meeting rooms for collaboration/discussion
- Event space
- Pantry with snacks and drinks
- Leisure area with beanbags and knick-knacks
Other unique amenities some operators may include are
- Living quarters
- Bar and booze
- Pool or billiards tables
- Game Center
- 3D Printers
- Engineering workstations
…and many others
Coworking history, trends and its future
The first existence of coworking dated back in 1628 in a book that praises the power of coworking. Then came hackerspaces. First started in Berlin in 1995, c-base is community driven with public access working location and free Internet.
Image credit: MakeUseOf
Since then, shared office spaces has been popping up like mushrooms around the globe.
In 2005, the first official coworking space opened its door in San Francisco. The Hat Factory started by Brad Neuberg is a shared workspace, which evolved into our modern day coworking spaces.
Image credit: The New York Times
However, the earlier coworking concept has a weakness. Its vulnerability lies in the revenue model of co-working spaces.
It has become some of the biggest challenges for operators.
To begin with, operators have to go through a steep learning curve to manage such a unique space using sharing economy that offers low margin with high lease cost. What’s worst is that most operators do not own the space, and they have to rely heavily on membership fees to sustain the business.
These made it hard for coworking space operators to stay afloat, never mind the growth.
That is why, as time passes, we see more operators try to acquire own property. We also see large corporations with deeper pockets build and run their own co-working spaces. Operators found ways to gain additional revenue streams. They have also learned to create value offerings to attract more potential coworkers.
Are they really making money out of it?
Perhaps not much. Though we are not there yet, I’m sure we will be one day.
In our case, ACAT Penang may not be for the purpose of money. However, to continually cultivate an active collaborative community, sustainability is still crucial. One of the important factors in a growing ecosystem is a place for the community to call home. ACAT aspires to be that home for Penang.
To understand how the operators are diversifying their efforts, here are some examples of how operators maintain their coworking business, though many are still struggling.
The Foundery in Toronto, Canada uses real estate crowdfunding for the buildings. The Foundery Buildings offer not just workspaces, but event venues as well.
Image credit: The Foundery
In Penang, Wisma Yeap Chor Ee, the majestic colonial heritage building, houses ACAT Penang and Penang Science Cluster. It is owned by the Wawasan Open University under a 30-year lease agreement with Penang Development Corporation (PDC). It is an initiative of InvestPenang with the support of the Penang State Government’s to accelerate the tech and startup ecosystem in Penang.
Come check out our space or you can visit our website, ACAT Penang.
We also have a Cradle-funded workspace in Damansara KL known as WORQ. Also, let’s not forget 8spaces, founded by Lais de Oliveira in 2015, which then got acquired by FlySpaces in June last year. These are some of the newer ones. There were more.
In fact, shared working office in Malaysia reportedly began around 2006 to 2007.
Today, we have over 40 coworking spaces in Malaysia with a total of 4 in Penang:
- @CAT Penang @George Town
- Snooze50 @Gurney Tower
- Regus @Bayan Lepas
- FlexiSpace @Butterworth
We all know coworking space is here to stay.
Only that how the spaces are being shared and what values they offer to make a difference.
Co-Living, Co-Working, Retreats…The world beyond work
Uniqueness is probably the best way to stay competitive in this sharing economy for real estate industry.
Today, there are many interestingly creative spaces for co-living, co-working or workcation (a term coined from ‘work’ and ‘vacation’).
Take, for instance, Nest Copenhagen. Nest is a co-living space for entrepreneurs to drink wine and eat together, watch movies, and talk about business, life and relationships.
Hera Hub in California and Washington D.C. is the first international women-focused coworking space with a spa-like environment and amenities most co-working spaces offer.
The list goes on and on in each with a distinct variation.
The rise of co-everything
The trending concept of co-everything works perfectly today. It emerges with the modern generation and working style.
Firstly, we have the Millennials, which is the biggest group today. They share a common, unique mindset when it comes to materials. A mindset that works perfectly with the co-everything concept.
Millennials are happy to own nothing!
With just a backpack containing the essentials like a laptop, mobile phone and some cash, calling for Uber to head to a shared workspace, and sitting at a desk you do not permanently own, may all seem odd to you. But, this is pretty normal to a millennial.
Secondly, with the growing numbers of Freelancers today, it gives coworking business an opportunity to prosper.
According to Clearly Coworking, by the year 2020, 40% of the workforce will be freelancers, temps, independent contractors, and solopreneurs. These are the folks who could benefit from working in a shared office.
Lastly, the trending Digital Nomads lifestyle.
With the increasing co-living and co-working spaces globally, more digital nomads can be seen globe-trotting on years-long workcation. Turning the world’s coworking spaces as their global working hubs, they meet new people or find collaboration opportunities almost anywhere.
On top of that, we also see more large corporations advocating flexible working arrangements more than ever today.
Why People Thrive in Coworking Spaces?
As a freelancer myself, I have been working occasionally at ACAT Penang. I found myself wondering about the coworkers. So, I chatted with a few @CATors from Europe, North America, and also our locals. I truly enjoyed their positive vibes.
There is something special about coworking spaces.
Years of studies on how employees thrive in correlation with the environment have put coworking space pretty high on the rank.
According to the results, people in coworking spaces are found at a thriving level approaching an average of 6 on a 7-point scale*. That’s one point higher than employees who do their jobs in regular offices.
Here’s a typical list of reasons you’ll find on the net.
- Sense of belonging, community connection and support system
- Power of control over their life
- They see their work as meaningful
- The positive vibe of a coworking space
- Meeting a diversified crowd from all walks of life
- Potential collaborations and business opportunities
However, let’s take a step back to really investigate why. We need to look from the angle of basic human needs. I think the reasons coworking spaces work can be explained through Maslow’s Hierarchy of Needs.
Image Credit: Simply Psychology
You’ll notice that working in a vibrant collaborative environment such as the coworking space could easily be the answer to all your needs.
Coworking spaces offer essential physiological amenities
Most coworking spaces have food and water; are cool or warm (depending on the external climate); a roof over your head throughout the day and have very comfortable areas for you to work or rest in between work.
Now we all know, most corporate working environment oozes near-threatening vibes. People are continually fighting, striving for more time, more power, more attention and more.
Don’t get me wrong. It may be useful for individuals who finds a highly stressful environment suitable for personal development. Some may even thrive in one. But, it could kill the passion of many others.
Coworking space is largely a harmonious place with vibrant energy. Everyone comes from different companies, fighting own battles, in the shared space. Thus, they have nothing to go against each other.
In such case, you don’t have to be in a constant fight or flight mode. You’ll feel safer and more secure in a peaceful, friendly environment.
Coworking community is right for you psychologically
Having a sense of belonging is no doubt one of the most important things to humankind. Ostracised people or individuals who felt ousted from a group, may grow or behave morosely. People readily act up when they feel out of place.
A coworking space may have residents from all walks of life, but they all come together as part of the coworking community. There’s an invisible force that holds the group together in a such a community, especially healthy for loners like mompreneurs, solopreneurs or freelancers.
When you are happier, you became more productive. You can achieve more and that gives you a greater sense of accomplishments.
Coworking environment offers self-actualization opportunities
Fitting space, vibrant community, and positive people. Working on a job you are passionate about and having control over it. The combination of all these makes it the best place to bring out the creativity in you and to be able to achieve your full potential.
Don’t just take my word for it. Give it a try for yourself and enjoy a new experience. Find out whether you like it or not and share with us your thoughts by leaving your comments below. Come visit us if you will. We hope to see you around at ACAT Penang.
* Porath, C., Spreitzer, G., Gibson, C., & Garnett, F.G. (2012). Thriving at work: Toward its measurement, construct validation, and theoretical refinement. Journal of Organizational Behaviour, 33, 250-275. Web. 1 May 2017.