Why (governments) should invest in coworking?

[Jonathan Yankovich]

> Jonathan said:
> > for local/regional/state/national groups interested in coworking, to support
> > the cause and show people the real value using numbers as opposed to the
> > more ephemeral attributes that we're talking about here.

Alex said:

> To what end? *Sounds* great but most governments and coworking space
> owners/operators/founders won't have a clue what to do with these "metrics"
> other than throw them at the EDCs and, well, I've already written about
> that: http://dangerouslyawesome.com/2010/12/on-economic-development-centers-and-coworking/

I think its more about communicating the value of this new model to
the people who hold the purse strings in communities when it comes
to. In Madison, our city economic development champion "gets"
coworking and sees it as the future, but recognizes that few of the
people who are generally involved with economic development decisions
and about how to spend government money really understand it the way
we do.

Some of the questions I've been asked:

- How many sqft does a space need to be successful?
- How quickly does membership typically grow?
- How many members can be supported per sqft?
- How many "jobs" and "businesses" are generally created and over what
period of time?

Answering these kinds of questions will give "EDC's" information that
they can understand in the context they're used to. These folks are
used to things like business plan contests (not coworking),
"incubators" (not coworking), and tax subsidies for small businesses
(not coworking). If we want them to understand the value of
coworking, we have to present information about it in a way that they
can "get". I was hoping that by gathering metrics we could do this,
but based on feedback from many people on this list, it sounds like a
problem that we perhaps shouldn't even try to solve ... for now.

But to answer your question - To what end? To the end of getting
funding, tax breaks, etc from cities to promote the growth of
coworking.

_jonathan yankovich

[Jonathan Yankovich]

We recently had an opportunity to present to the Wisconsin State
Economic Development and Housing Authority which is a pretty big group
of people focused on economic development across the state of
Wisconsin. One of the slides contained the following, reposted here
for the benefit of others:

*Why invest in Coworking?*

Coworking benefits its members...

- Zero-risk space to work independently, start real businesses
- Instant collaboration between entrepreneurs, creative class,
academics
- Accelerated business and professional development
- Network (local linked in, supply chain, industry sector, bus.
Development)

Coworking benefits Commercial Real Estate...

- Professional membership increases nearby office & retail value
- Groups form increasing demand for dedicated office spaces (reduce
vacancy and incubate/generate future tenants)
- Low impact on parking, CAM, and low need for improvements

Coworking benefits the Broader Economy...

- Increases the creation of establishments via reduced risk & capitol
- Develops workforce via lower barrier to professional engagement
- Grassroots product development accelerates technology transfer
- Attracts and retains graduates & creative class professionals
- Connects Private Sector with Academia, ED Resources

Link to presentation: https://docs.google.com/present/edit?id=0AQEwrcOYnrMAZGN4ajlmbXBfMTUwOXh2NzcyZ3Y&hl=en
Anyone interested in using the material from this presentation is
welcome to. Attribution would be nice but isn't required - and I'd be
interested in hearing about your efforts. My email is
jonathan....@gmail.com .)

[Alex Hillman]

But to answer your question - To what end?  To the end of getting funding, tax breaks, etc from cities to promote the growth of coworking.

Maybe it's just a philosophical difference but we've intentionally gone the OTHER direction, building things in a way that doesn't require or need the city for growth. In fact, most of our interactions with the city (and they're happening regularly) involve a conversation that goes something like, "We love what you guys are doing, and more importantly, that you're not doing it with your hand out." To us, NOT needing them is just as important as helping them. Needing them in order to help them isn't really helping them in the long term. 

Some of the questions I've been asked: 

- How many sqft does a space need to be successful? 

- How quickly does membership typically grow? 

- How many members can be supported per sqft? 

- How many "jobs" and "businesses" are generally created and over what period of time?

I get these too. 3-5 times a week. Just because they ask a question doesn't mean answering that question is the right answer. 

http://dangerouslyawesome.com/2010/11/where-jobs-come-from/

Giving them answers that satiate them is nice and all, but there's SO much more value in pushing them to rethink the questions they're asking. When folks from these organizations (private or public sector) want to understand coworking better, I give them the same answer that I give members interested in coworking: just show up.

-Alex

 

/ah
indyhall.org
coworking in philadelphia

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[Jerome Chang]

Look everyone. I know that some of you are very ambitious and creative to convince, say, an EDC to invest in coworking.  But to provide industry-wide metrics for traditional-minded views is tough when this "industry" has just begun.  Besides, the data is going to be all over the place.  There hasn't been any "formula" for ramp-up, square footage effectiveness, composition of memberships (full-time vs. part-time, etc.)...Every facility is going to be different, and even if similar, probably hasn't been around long enough to provide any meaningful metric.

The only way to get meaningful metrics is for some academic grant or some philanthropic benefactor to finance the resources to gather such fragmented and very early data.

So like Alex has recommended many times over, just focus on your facility, your community and use your common sense to adjust as req'd.

Jerome

______________
BLANKSPACES
"work FOR yourself, not BY yourself"

www.blankspaces.com
5405 Wilshire Blvd (2 blocks west of La Brea)
Los Angeles, CA 90036

1450 2nd Street (@ Broadway)

Santa Monica, CA 90401

323.330.9505 (office)

[Derek Neighbors]

Jonathan,

It seems you are focused on the wrong things if you want to engage with Economic Development professionals.  I will be at the coworking unconference in Austin and would be willing to talk with people about this.  Gangplank has significant partnership with it's city and in process of launching additional sites as partners with other cities.  Alex/Jerome I think your assertions are on the right track, but I can promise that you don't have to create a traditional coworking space in order to get the attention of the ED in your city.  In fact, doing so probably hurts you more than it helps you. 

--
Derek Neighbors
Gangplank

[Jerome Chang]

Can you elaborate how creating a space first could hurt you?

Jerome

______________
BLANKSPACES
"work FOR yourself, not BY yourself"

www.blankspaces.com
5405 Wilshire Blvd (2 blocks west of La Brea)
Los Angeles, CA 90036

1450 2nd Street (@ Broadway)

Santa Monica, CA 90401

323.330.9505 (office)

[Jack]

Jonathan,
I understand where you are coming from and I concur. Not every
municipality "gets it." Derek was fortunate to get a nice grant from
his municipality, but many cities and towns do not have a clue about
the economic benefits of coworking, both from a direct and indirect
(impact on commercial real estate) basis. I also agree that EDCs are
used to seeing business plans and talking about business incubators,
so when they are exposed to something they are not familiar with, you
get resistance.

I would be interested in getting a copy of your presentation. We are
opening a coworking facility in Prescott Arizona starting with a soft
opening tour on March 24. I used to be the mayor here and at some
point I intend to update the current city council on what we are
doing. See our blog at http://launchpadprescott.wordpress.com/ for
information on what we are up to.

On Mar 3, 1:07 pm, Jonathan Yankovich <jonathan.yankov...@gmail.com>
wrote:

> We recently had an opportunity to present to the Wisconsin State
> Economic Development and Housing Authority which is a pretty big group
> of people focused on economic development across the state of
> Wisconsin. One of the slides contained the following, reposted here
> for the benefit of others:
>
> *Why invest in Coworking?*
>
> Coworking benefits its members...
>
> - Zero-risk space to work independently, start real businesses
> - Instant collaboration between entrepreneurs, creative class,
> academics
> - Accelerated business and professional development
> - Network (local linked in, supply chain, industry sector, bus.
> Development)
>
> Coworking benefits Commercial Real Estate...
>
> - Professional membership increases nearby office & retail value
> - Groups form increasing demand for dedicated office spaces (reduce
> vacancy and incubate/generate future tenants)
> - Low impact on parking, CAM, and low need for improvements
>
> Coworking benefits the Broader Economy...
>
> - Increases the creation of establishments via reduced risk & capitol
> - Develops workforce via lower barrier to professional engagement
> - Grassroots product development accelerates technology transfer
> - Attracts and retains graduates & creative class professionals
> - Connects Private Sector with Academia, ED Resources
>

> Link to presentation:https://docs.google.com/present/edit?id=0AQEwrcOYnrMAZGN4ajlmbXBfMTUw...

> Anyone interested in using the material from this presentation is
> welcome to.  Attribution would be nice but isn't required - and I'd be
> interested in hearing about your efforts. My email is

> jonathan.yankov...@gmail.com .)

[Mark Gilbreath]

Hey Jonathan,  I think you are on the right track with these metrics and in understanding that many audiences, like economic development groups (and public companies) need to be able to translate their involvement into a tangible ROI.  Metrics are essential to this.  This doesn't mean that one has to abandon the community focus as priority #1, #2 and #3.  It just means we need to be able to translate our story appropriately depending on the audience.   Sorry for preaching to the choir.   I've seen it work first hand in securing the active support of a local Mayor, who then put real dollars behind paying members fees, just to bring more entrepreneurs to her City.  Would love to share more details.  Are you heading to Austin next week?

Mark Gilbreath

LiquidSpace

 

[Matthew Tuerk]

I'd like to chime in as a manager of an economic development
organization (EDO) that is making an investment in coworking in our
community.

I work for the Allentown Economic Development Corporation (AEDC) in
Pennsylvania's Lehigh Valley, a community of over 800,000 people
spread across three cities with distinctive personalities. AEDC is a
little different from other EDO's around the country in that we own
property. One of our buildings has hosted a small business incubator
since 1989 and over the past few years, a variety of factors led to an
organizational interest in collaborative workspace. We started off by
looking at hackerspace, and have since started working toward the
creation of coworking space. We started off on the wrong foot (I am
sure that I asked Alex some of the questions that he would rather not
answer), but after following along here and visiting other space, I
feel like we are headed in the right direction, i.e. focusing on the
people rather than the space.

I would submit two things in defense of EDO's getting engaged in
coworking space. One is that despite Alex's assertion that if you are
an institution you are not leading the revolution, there are people
working for institutions that are pursuing revolutionary objectives.
If coworking as a concept is as democratic as I believe it to be, the
catalyst of space can come from an architecture, web development,
graphic design, consulting or economic development. I could go on--and
I certainly have reservations about the motivation for other EDO's--
but I don't think that one should universally shun involvement with
local EDO's if they appear to get it.

Secondly, an important role for an EDO in the creation of coworking
space is education. If AEDC were not leading the charge for coworking
in the Lehigh Valley, we might not see it happening here for a long
time. Most of our members had not heard of coworking when we first
suggested it, but have strongly embraced it since they started.
Finding the critical mass in your community can be difficult without
someone to convene.

Again: not all EDO's are prepared to effectively support coworking.
But don't write them all off.

> > in coworking: *just show up.*

>
> > -Alex
>
> > /ah
> > indyhall.org
> > coworking in philadelphia
>
> > On Thu, Mar 3, 2011 at 3:04 PM, Jonathan Yankovich <
> > jonathan.yankov...@gmail.com> wrote:
>
> >> > Jonathan said:
> >> > > for local/regional/state/national groups interested in coworking, to
> >> support
> >> > > the cause and show people the real value using numbers as opposed to
> >> the
> >> > > more ephemeral attributes that we're talking about here.
>
> >> Alex said:
>
> >> > To what end? *Sounds* great but most governments and coworking space
> >> > owners/operators/founders won't have a clue what to do with these
> >> "metrics"
> >> > other than throw them at the EDCs and, well, I've already written about
> >> > that:

> >>http://dangerouslyawesome.com/2010/12/on-economic-development-centers...

[Derek Neighbors]

Because coworking as most people implement it looks like shared office space.  It looks like a real estate proposition in which no city in their right mind really wants to back.  Starting with that model can be more of a turn off.  Again this is a discussion, much larger than via email imho.  If you are at sxsw I would love to discuss or when in LA next.

--
Derek Neighbors
Gangplank

[Derek Neighbors]

Jack,

It's disingenuous to say we were "fortunate to get a nice grant from his municipality".  Partially, because it is not a grant and secondly because there was no "luck or fortune" involved.  There were years of hard work positioning the idea and putting the right formula and concept together.  Significant capital and time was invested on our side to put things into place.  My point, is that not all ED are lame, most of them are at least willing to listen.  If you understand the market, resources and how to position correctly it goes a long way. 

We are currently working with cities around the world to use the model and concepts we have built.  I suspect that we will get "fortunate" again several times this year.

--
Derek Neighbors
Gangplank

--

[Jack]

What I would say is this is an evolving model that has many variations
and I would contend that no one person has the magic formula. This
evolution will head in multiple directions, as is already apparent.
That to me means there is room for multiple approaches to supporting
freelancers, entrepreneurs and start-ups. Our city lacks an effective
EDO (public or private), so that creates an opportunity for someone
else to step-in (or step up). I spent thirty years in middle
management in corporate America with all its office politics. One of
the things I really appreciate about the coworking community is the
ability to share, discuss, debate...

> >http://groups.google.com/group/coworking?hl=en.- Hide quoted text -
>
> - Show quoted text -