By the end of this year, there will be 1.2 million people working in at least a one of the 14.000 coworking spaces worldwide. Clearly, coworking is a global trend and reshaping the way people work. The perks of coworking for Freelancers, SMEs and even corporates are well-documented, but what about for startups?
Early stage companies can benefit greatly from utilizing shared workspaces. First, coworking frees than from fixed costs and lock-ins that are typically associated with renting or buying a whole office space. It further reduces their operating costs by sharing resources such as printers, meeting rooms, kitchen, facilities and reception desk and much more. In addition, coworking enables startups to be more flexible as they can adapt their space needs and costs according to their growth rate, which any entrepreneur can tell you varies greatly. It also vastly boosts their recruiting efforts as they'll possess a cool office to "sell" potential employees instead of a garage or warehouse space in the outskirts of town. The environment of a shared workplace makes startup employees more productive as they'll be around like-minded individuals and entrepreneurs who have a lot of passion and energy that tends to motivate everyone around them. Finally, coworking creates a lot of opportunities for business development and partnerships as its community itself offers a great place for startups to network, test their product and revceive feedback from professionales from several industries.
But coworking doesn't just look good on paper. We've done some research and actually identified 5 highly-successful startups that were launched from coworking spaces. You'll probably recognize most of them when you see their name, so without further ado, here's our list of:
On a cold winter evening in Paris in 2008, Travis Kalanick and Garrett Camp struggled to hail a taxi and invented the idea of getting a ride by simply clicking a button on your smartphone. Uber was born.
While many people probably know the Uber startup story, few are aware that Uber launched a big part of its operations and nurtured the unicorn startup in the coworking space "The Yard" in New York. Needless to say, coworking was good for Uber. Now operating in over 250 cities from 51 countries and reaching a valuation of $70 billion provides pretty decent proof of their success, wouldn't you say? Oh, and besides that, they also managed to solve the whole designated driver dilemma after a night on the town with your friends.
Yep, you may have heard of this company too. Founded in 2010 and sold to Facebook for $1 billion two years later, Instagram is one of the biggest startup success stories of the decade.
However, few people know that the company started out in Dogpath Labs, a coworking space in San Francisco, California. As co-founder Mike Krieger points out in his blog post "Why Instagram Worked", at the very beginning everything wasn't all that easy. In fact, initially they were working on a location-based social network called Burbn that gathered a solid, but not spectacular, userbase. Then, one day sitting in a conference room of their coworking space, they wisely chose to focus on what they noticed performed best - those old-timey photo filters. Within two months they redesigned and launched a new app - Instagram. Afterwards, interest in the app exploded. They even had to spend more than a few sleppless nights in their shared office space in order to keep pace with the growing user base that was overwhelming servers. As we all know, they overcame these early challenges and became one of the most successful startups ever. Unfortunately, the original location of Instagram's first home in San Francisco has been closed as Dogpatch Labs decided to focus on other locations.
While the story of founder Scott Harrison going from nightclub promoter to social entrepreneur is a great read on its own, this social startup is also a particularly fascinating example for a successful venture originating from a coworking space.
Charity: Water was founded at a WeWork community in New York in 2006 and took off ever since. The NGO is focused on ensuring that every person around the world has access to clean water, and within a decade managed to provide over 7 million people in 24 countries with clean water thanks to funding more than 22.000 projects. The non-profit organization is a great case showing how high-growth startups can benefit from coworking, as the firm used shared work spaces in a smart way to expand into other cities at a low cost. Additionally, as the company was part of a bigger community, they managed to actually receive a lot of support such as donated chairs, tables and other equipment from their coworking space and even landed an official partnership there.
This startup disrupted the travel industry must ranks among the fastest successful exits. They were founded in 2009, raised $1M in 2011, and acquired by TripAdvisor for an undisclosed amount one year later.
Certainly, launching their company in the shared office called Projective Space in New York was a major success factor. Actually, what's interesting about Wanderfly is that their founders must have know that from the start as they were eager to launch the company in a coworking space due to three main reasons. Fisrt, they were convinced it was giving them the best chance to succeed. Second, they wanted make sure that their whole team could stay highly stimulated and motivated, and they knew the best way to achieve this was to take advantage of the coworking environment, where they would work alongside high-performing and creative coworkers. Finally, they opted for a coworking space from the start because they wanted to leverage networking and collaboration opportunities from the very beginning. In short, Wanderfly is a great example of how startups benefit from coworking spaces.
To put things into perspective, we also included a smaller scale company. In that regard, Barcelona-based d+b Intersection is a particularly interesting case as they actually took a slightly different path.
In fact, the founder Alexandra Rodriguez started the business in her own flat, before figuring out she needed a more inspiring coworking space to take a leap. For her innovation design visualization company, the main advantages of coworking were that she needed a place to sharing the project idea, meet other motivated and outstanding professionals and to develop a more open mind and boost creativity. The arguments resonates well with what many other startups, freelancers and coworkers experience when moving into a shared space. When launching a project from zero, the garage or flat seems like a great place as it basically doesn't create any costs. However, what a lot of entrepreneurs and self-employed people quickly discover is that they are "isolated". This is not just bad news for personal life, but also for business as they are not being exposed sufficiently to an external network that can review the product, feedback the business model and contribute on the project with their onw ideas.
Of course, there are many more coworking success stories besides the 5 startups presented above. Orderbird, Toutapp, Coffeecircle, Ezeep and Indiegogo just to name a few. Do you knwo of any big winning starups that were born in a coworking space? Share them in the comment section below.