According to the FT, big businesses are changing their office culture to save office space and money. Emma Jacobs from the FT described how larges companies are trying to replicate the startups culture. It seems if coworking and hot-desking is the future, big business want a slice of the pie. Not only do large firms and organisations want to mimic the buzz of Old Street or San Francisco tech environment, companies want the flexibility that coworking and hot-desking offers. One of the key advantages of coworking that employees mention, is that the vibe is cool and exciting working alongside energetic startups and techies. There is an abundance of coworking offices in major cities like Hong Kong, New York, London and Berlin who use the exciting profile of coworking to attract big businesses. WeWork are in over 30 cities and they deliberately seek out large businesses by using they coworking image as an exciting and lively place to work from.
Instead of operating out of co-work space providers like WeWork, Workspace, Avanta, BEOffices or Co-Work, some large companies and recreating the same models within their existing offices. Businesses like Capita offer hot-desking for their staff, YouTube offer people office space if they have 10,000 subscribers, Dixons Carphone Warehouse offers partners coworking space within their head office. Flexible working is here to stay. All the major tech companies like Google, Yahoo, Ebay and Facebook have been doing this for years. If you already have an office, it doesn’t make any sense relocating to a coworking space. However, bringing in a coworking space to your office not only brings the vibrant vibe of flexible working but also brings in the money. O2 provides office space for companies it has joint ventures with. Intermediary brokers like Goldman Sachs, Barclays, ICAP, HSBC, Deutsche Bank and JP Morgan offer customers (Hedge funds, venture capital firms and private equity) the opportunity to operate out of their offices.
In May 2016, Royal Bank of Scotland (RBS) and RocketSpace plan to open a coworking space in London in early 2017. RBS is teaming up with an established US coworking space provider who specialise in tech startups. Their new campus in Angel will accommodate 1,500 members. Like the San Francisco workspace, in London too, RocketSpace will provide space for teams of 1 to 100 people and will focus on tech startups that have raised funds. The London members will also be provided access to leading global corporations, including the company’s clients such as Tata Communications, Axel-Springer, Lufthansa Cargo and Schneider Electric. RocketSpace has housed some of the biggest Tech companies in the US like Uber, Blippar, SuperCell and Spotify.
Patrick Clark from Bloomberg details how corporate businesses have taken to coworking. He described how coworking providers are leading the way big business operates in terms of office space. WeWork can boast some of the biggest companies in the world as its tenants. Merck, KPMG, even the Guardian newspaper are some of the many large names who want to change their working culture and are located in WeWork offices. This will only grow. By the end of 2016 there will be over 10,000 coworking companies worldwide. At Co Work Hub, we have large companies here. Braiform are one of our members. They are second biggest producer of clothing hangers in the world with offices globally. They are very impressive and operate out of our office in North Acton. Wellington Markets PLC, have been managing markets in the UK for 800 years. We are privileged to have them as members and watch their business grow with us. I have seen with my own eyes that larger firms are more than capable of working within a shared office environment.
The coworking movement has been so rapid that traditional office space providers like Regus and the Office Group have adapted their business strategies to create just coworking offices. Both firms seek to attract smaller business into some their places. In the U.S. 33% of the workforce is independent or a freelancer. It has been forecast to increase by 40% by 2020 by Forbes, the American Bureau of Labor Statistics, Deskmag and Kap Design. The largest customers of coworking are freelancers.
At the core of the coworking movement will often be freelancers, startups, entrepreneurs and small businesses. On average, coworking space providers have 76 members. Most providers remain keen to attract smaller companies and concentration on the startup or tech revolution. According to Deskmag (coworking magazine) suggests that the need for coworking space remains largest with freelancers, startups and entrepreneurs. These types of individuals have a limited, often small budget and the flexibility that coworking and hot-desking offers is essential. So, is the big business adventure with coworking a fad or is it here to stay? Personally I believe the answer is yes, it is here to stay. All the signs and forecasts suggest that providers will aim to attract both small businesses and big businesses. Patrick Clark suggested that this is the beginning of the coworking big business revolution.
Will big businesses adapt to coworking, the answer is yes. The problem is will coworking be able to keep up with the demand. JLL have suggested that the productivity in the coworking environment is one of the reasons for the rapid growth in coworking among large corporations. The collaborative nature of coworking offices allow businesses to be more creative than they might have been if they were in their own isolated private office. The next big move for offices will be consolidations and mergers.