Business Overview

As the pace and structure of the workplace changes, businesses small and large are looking for new office solutions that meet their evolving needs. Coworking space businesses meet these needs by renting out office space in flexible formats. The coworking space sector is thriving, growing at an average rate of 23 percent annually since 2010.

Who is this business right for?

Anyone who enjoys interacting with people and is passionate about entrepreneurship might like running a coworking space business. People skills are essential, as this business model is largely built on networking and developing a community. A passion for new businesses helps business owners better connect with many of their clients, who will tend to be entrepreneurs or work for startups.

What happens during a typical day at a coworking space business?

A typical day at a coworking space business is full of hustle and bustle.

The essential work of the business is making sure the lights are on -- quite literally. Clients use coworking spaces as offices, and they expect the lights to be functioning, roof to not be leaking and internet access to be connected. Should any utility or maintenance issue present itself, resources must be immediately devoted to resolving the problem as quickly as possible.

Assuming there is no imminent building crisis, running a coworking space involves keeping the area clean, socializing with clients and meeting potential clients. Of course, there are bills to pay and administrative matters to see to. Also, business owners might be teaching a class or hosting some other event on any given day.

All of this is surrounded by the activity of the clients who are using the coworking space as an office. The cumulative activity is one of the main draws of this business, as it helps everyone present stay motivated and focused.

What is the target market?

The target market for a coworking space business is business owners and professionals in the area. Some larger coworking spaces cater to large corporations with traveling employees, but most new spaces focus on serving entrepreneurs, solopreneurs and small business owners in the local community.

How does a coworking space business make money?

A coworking space business’ primary source of revenue is subscription fees, which clients pay in exchange for being able to use the space. Many coworking space businesses rent meeting rooms, offer classes and hold events for additional sources of revenue.

What is the growth potential for a coworking space business?

A coworking space business may have a single location or it can grow to be an international company. Dallas Fort Work in Dallas, Texas and The CommonSpot in Ithaca, New York are two examples of coworking spaces that have one location. WeWork is one of the largest coworking space businesses in the world, with dozens of locations spread across many countries.

When a successful coworking space is ready to expand, opening an additional location is usually better than expanding a current location. Adding a location, either in the same city or another city, helps the coworking space reach more potential clients in different neighborhoods or metropolises.