Justifying Coworking As an Investment

coworking spaceCoworking is a great trend, one that is taking root in even the most unlikely of soil, including areas where it has a chance of making a big difference, like Detroit. For freelancers and small startups, a coworking space provides a great opportunity to work with others, and to have office space to show off when a client comes calling, without incurring the cost of a more permanent lease.

But coworking doesn’t come with zero cost, unless it’s done on the very small scale of inviting someone into your own home, or being invited into the home of another. You could also try meeting at somewhere that doesn’t charge beyond the price of a coffee, like a Starbucks, but how reliable is that really? In a big city, space is at a premium, so there’s no guarantee there’ll be room to meet there. So the question is, is investing in proper coworking space worth your while? How and when does it become a justifiable expense?

Step 1: Identify What You Have to Gain from Coworking

I’m not talking about the good feeling and sense of camaraderie you miss from your days working in an office setting, although you should feel free to list that, as well. It may not have a tangible monetary effect, but it will help with morale, which is always important.

Putting that aside, though, what are you intending to get out of coworking? Have you spoken to others who’ve tried it, and attempted to gauge the actual impact it’s had on their business? Maybe what you’re actually looking for is meeting space for occasional use, which is something else entirely and can be had much more cheaply.

If you are looking to build meaningful professional relationships, the kind that can’t come from email exchanges and the occasional lunch, then coworking presents a tangible benefit. If you need your company to have a public face, and one that exists in a brick-and-mortar sense, and you need that consistently, then coworking presents an attractive proposition. If your working hours are interrupted in consistent and unpredictable ways at your home office, damaging your productivity, then coworking could help.

Step 2: Assess the Risks and Costs Associated with Coworking

Once you know what you want to get out of the deal, carefully examine what it will cost you to get it. Depending on how long you’ve been working remotely, you may be in for a surprise at what a return to the commuting lifestyle will actually run to, all told.

For example, where is the nearest coworking venture in your city? Does your city even have one? (We won’t address the costs of starting your own at the moment.) Will you have to take transit, or do you have your own transportation? Just getting to or from your new office could represent a significant additional cost that your usual budget doesn’t include.

Workspace rental fees is another cost associated with coworking. For example, one near my home in downtown Toronto charges $350 a month for office space that’s accessible 24 hrs, with some meeting room time included. It’s $75 per work day if you don’t need the freedom of 24/7 accessibility. For many of us, those aren’t costs that our working budget can easily absorb.

Step 3: Make an Informed Decision

Once you have all the variables on the table, you still probably won’t have a very cut-and-dry choice. At least you’ll be informed, though. The more you focus on the hard benefits and costs associated with coworking, and the less you focus on your desire to socialize or try something new, the better. If all else fails, work out a set term for an initial trial, and then do a rigorous follow-up analysis to see if it’s economically tenable in the long run, and, more importantly, if you got some tangible benefit, enjoyed it and remained productive.

Photo credit: hyku on flickr