- Posted by:
- Category: Coworking Industry
By Mike Panesis
When I say “coworking,” what comes to mind? Hip, flexible work spaces? Opportunities for serendipitous collaboration? Feeling a part of a community? The perfect place to launch a startup?
It stands to reason that coworking is a natural fit for entrepreneurs. Founders can pursue their dreams among like-minded peers who help each other. Coworking feels more professional than a coffee shop and less confining than a home office, and it fosters a sense of optimism and enthusiasm. Unfortunately, coworking has also gotten quite expensive.
The coworking movement began in 2005 in San Francisco. Software engineer Brad Neuberg coined the term, reflecting a desire to bring community and a more structured work life to fellow freelancers.
Coworking originally was meant to be affordable and accessible.
Coworking spaces were preceded by and often confused with startup incubators promising affordable space, mentoring, education and perhaps investment. There have been startup incubators in the United States since the 1950s, but they became very popular during the first dot-com boom at the turn of this century. Unlike coworking spaces, incubators focus on startup launch, often specializing in an industry or technology, and are selective. Incubators, while associated with locations, also are more about programs and services than community.
The term coworking now is closely associated with for-profit enterprise. Industry giant WeWork is one of the largest venture capital unicorns, valued at more than $45 billion. Although it goes by the same name, for-profit coworking employs a revolutionary business model that amounts to the “Uberization” of real estate. For-profit coworking counts among its clients large corporations that are willing to pay a premium for flexible office space. There are plenty of entrepreneurs in for-profit coworking spaces, but for many, especially those who are just getting started, the monthly cost of coworking is unaffordable.
Cal Lutheran started its Center for Entrepreneurship in 2014 with a mission to teach its students about entrepreneurship. Understanding that the study of entrepreneurship is best experienced through exposure to practicing entrepreneurs, we opened Hub101, a space for local startups.
Hub101 has become a valuable resource to Cal Lutheran’s students and faculty. In our experiments on Hub101’s value to the community, we have found two essential needs. The first is as a startup community center, where the curious and aspiring founders can come to try startup life on for size by hearing inspiring speakers, attending meetups and participating in hackathons and startup weekends. The second is as a provider of affordable coworking. We put the entrepreneur first, especially in the very early stages of a startup, when capital comes from one’s personal checking account and credit cards. While we work toward being able to offer a true incubator, our experienced community members provide mentoring support at a level as if we were operating one.
As a nonprofit, faith-based university, Cal Lutheran’s expectations for Hub101 are different than if we were a for-profit coworking space. We are willing to keep fees low to give entrepreneurs more of a running start. We advocate for the underrepresented, underestimated and overlooked. We encourage and recognize regular and random acts of kindness. We celebrate venture financing, jobs created and liquidity events. We take joy in the successful community that flourishes around us. This is our profit.
We are asked regularly what it would take to bring a Hub101 to other communities.
The first requirement is investment. Affordable coworking is not the same as free coworking. Government and institutions are in the best position to step up, as they are more likely to have space available that can be made affordable. We consider this type of investment to be 21st-century economic development.
The second requirement is patience. Building a community is much like a startup. There will be setbacks and pivots, but the return on investment could be substantial.
The third requirement is to put entrepreneurs first, to recognize the personal risks they are taking and give them every opportunity to succeed. Most of them will not, but those who do make the journey worthwhile.
• Mike Panesis is the executive director of the California Lutheran University Center for Entrepreneurship.