A VC backed work space isn't something I fear.

[Craig Baute - Creative Density Coworking]

This week the massive 30,000 sf.Galvanized Space opened in Denver with the backing of several VCs in the Front Range. They have lightly hugged the term coworking (they spell it as co-working), but are creating a space for the startup scene in the downtown area. They have private offices, permanent desks, and a hot desking area with classes and a focus on community - all signs of a great coworking environment. I'm excited for the opening of Galvanize, and I'm tired of people asking me if I'm worried. I am not.

Building awareness together. The more coworking spaces that open in a city that is young to the coworking movement is great for Creative Density and the other coworking spaces because it raises the awareness of coworking. We will all carry the burden of making coworking a mainstream word versus me and a few others doing all of the heavy lifting.

Different cultures. Creative Density does not focus on developers, writers, or designers in a tight niche. Instead, we want awesome and friendly people to fill the space with different ideas and perspectives. I believe that the diversity of thought from freelancers, remote workers, and startups is one of Creative Density's defining characteristics and greatest strength. Galvanzie is focused on tech startups and creating a community similar to the Boulder startup scene. The VCs want to create a vibrant community but also want a front row seat for potential future investments. It is great for people that fit into their vision, but not for the remote worker or the happy freelance writer.

Local community and location. Creative Density is about 1.5 miles away from any other coworking spaces and located about 10 blocks from the downtown core. We are surrounded by a fantastic neighborhood with great lunch spots, grocery stores, and cafes just around the corner in a mixed commercial and residential area (the location was voted on by our community). Galvanzie is on the other side of town and in a nice but different neighborhood. By following the general 20 min travel rule, together the coworking spaces are meeting the needs of more people that want to join a coworking community.

Several cities have already had a large VC backed collaborative spaces open up with Chicago being one of the most recent ones I can think of. Current coworking spaces should not fear but embrace the new members to their local coworking community and it should just be a reminder to focus on what makes your space special. 

Craig Baute

Creative Density

Denver

[Anca | Tech Liminal]

How are you coming up with the 10-100x financial returns generally expected for VC dollars?  Are you taking equity in startups?

Anca.

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[Veel Hoeden- Where Many Hats Meet!]

Craig- Couldn't agree more.  +1

 

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Chief Dreamchaser

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[Craig Baute - Creative Density Coworking]

Anca,

They are not taking equity and I would call those an accelerator or incubator. Instead they created the space so the VCs know what is going on in the startup community and are exposed to the new startups in the area. The goal of the space is not to make (much) money off of it but to gain exposure. Overall, it's a smart move on VCs and has gain popularity in several cities throughout the US.

Craig

[Anca | Tech Liminal]

Thanks Craig,

That makes sense.  The economics of coworking don't lend themselves for VC-funded high-growth businesses, but as a marketing move or a way to keep up with the pulse of what's new and interesting it adds up better.  

I'm about to look for funding for my move, so it's really helpful to see your story.

Anca.

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Visit this forum on the web at http://discuss.coworking.com
 
 

[Alex Hillman]

Amen, and well said. 

-Alex

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/ah

indyhall.org

coworking in philadelphia

building a community? http://masterclass.indyhall.org

[Susan Evans]

Craig, this is an awesome post. Thanks for sharing your experience! It's amazing how often individuals outside the coworking world default to traditional competition or fear-based responses when it comes to other spaces opening. I have never found the opening of another space to be anything but awesome for us here in Seattle. It is particularly powerful to be able to respond to questions with "actually i think it's awesome that another space has opened and I can't wait to go and visit!" 

Deskmag had some great data to back up the claim as well in their last coworking survey - something about coworking spaces doing financially better when there were more spaces in the same city. Obviously this is a stronger trend for bigger cities, but it's a powerful statistic nonetheless. I can dig up the image if you'd like - I know it's somewhere in the recesses of my gmail.

Collaboration. It's no wonder it's one of our core values! ;)

S

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[julianne]

Hey there Susan,

Yeah - that sounds right! I will look for the data and send through!

btw - have you all taken the new survey? First results will be presented at the Coworking Europe Conference: http://coworkingeurope.net/

Talk soon!

Julianne

[Nicolas Bergé]

@Craig

!

Nicely put.

Nicolas Bergé

Les Satellites

[Jamie Russo]

Craig,
Funny, when I saw that announcement, I was going to drop you an email and tell you not to freak out. Glad you're way ahead of me :-)  I started working on my space well before there was any news about 1871 in Chicago and I was a little thrown by the announcement right before I opened my space.  It's an amazing facility with well-funded resources and people love it.  But to your point, they have a very specific niche/mission and to date, the only impact has been completely positive.  Since they are well funded and run by the who's who in Chicago, they get a ton of press and they generate a lot of awareness of coworking in Chicago which has been slower to spread than in other cities. And that awareness drives people over to Enerspace and they love my space too, for some of the same and many different reasons.  Cheers and much success to all :-)

Jamie Russo
Enerspace Chicago
@enerspacechi
www.enerspacechicago.com

[julianne]

Hey there Susan,

I found two articles pertaining to the info you were looking for:

http://www.deskmag.com/en/the-development-of-coworking-spaces-213
Data from the Global Coworking Survey shows that solo coworking spaces are twice as likely to be unprofitable as those with many “competitors” on average. (the article continues with more info)

http://www.deskmag.com/en/survey-patterns-of-coworking-space-closure-560
We also notice that coworking spaces in small towns have a higher failure rate than those in big cities. We can attribute this to the higher gap of knowledge about coworking in these areas and fewer overall possibilities to attract coworkers. Coworking spaces in these areas tend to be smaller and members visit the space less frequently, making it more difficult to establish a profitable business - compared to those in big cities. (other interesting facts, not directly related to your query)

Hope this helps!

Cheers,

Julianne

julianne(at)deskwanted.com

[Susan Evans]

Awesome. Thanks, Julianne!

Susan

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