Recently we read multiple answers on Quora which said that if you rent a small space instead of working in a coworking space the cost is marginally less. So it made sense to rent a small space or work out of home because it saves you money. So it made us think is it really true and in what sense.
We started comparing. Lets do a little math.
Average start up consists of a team of 3-4 members
Lets start with 4.
Avg. Rent Per month per person – Rs 6000
Total Rent per month – Rs 24000
Other office related cost – 0
Total recurring cost – Rs 24000
Renting an Apartment ( 400 sq feet. 100 sq feet per person)
Rent per sq feet – Rs 40
Rent per month – Rs 16000
Deposit ( 3 month upfront) -Rs 48000
Furniture – Rs 20000
Electricity – Rs 2000
Wifi – Rs 1500
Housekeeping – Rs 500
Total recurring cost – Rs 20000
Total one time cost – Rs 68000
Lets now list down the pros and cons of renting out an apartment
-Recurring cost is marginally less
-Access to a place with no restrictions or barriers.
-Cost of switching to another office is high ( considering most of the furniture is not reused )
-Hassle of clearing multiple bills every month.
-High one time cost.
-Managing the office.
-Maintaining the office
So its true you might save a little per month and lot per year. But is that all to coworking ??
The bigger question we should ask is, does coworking increase productivity? Does coworking help people to innovate, learn and grow ?
Lets explore more
How much does an environment matter to the productivity of a worker ?
Watch this video which hints how working in different environments increases productivity
Coworking gives you different environments to work which increases your productivity.
Apart from that it gives you an aesthetic workspace. Compare these two photo below.
Which one do you think will foster productivity ?
How does collaboration help in achieving goals ?
We always overestimate what we can do alone and underestimate what we can do together.
The boundaries between our work lives and personal lives are becoming thin ; we no longer split up our time between “work hours” and “non-work hours”.As these lines diminish, we need new ways of maintaining balance.
Community is the way in which we can achieve this. These community of coworkers support you emotionally and also help you grow your business.
Apart from these benefits there is one more advantage “cognitive diversity”. When people with different thought process and profession apply their mind to complex problems. The result is a faster, better and a more elegant solution. Cognitive diversity will always give you an edge over your competitors.
Getting hold of a community which is filled with like minded people who love what they do is something precious. Because in the end the people matter the most.
Where is the world moving towards?
In the book “The Inevitable” by Kevin Kelly it states that accessibility is going to be the key to the future. Business are being built around the idea of accessibility. Lets look at a few businesses which are exploiting this trend.
Spotify – now one doesn’t need to own individual tracks. You just need a subscription to the app and get access to the whole library of songs. Now to listen to your favorite tracks you don’t need to own the track.
Amazon Kindle prime membership- it allows user to access millions of titles with just a subscription fee. Now to read book you don’t need to own the book.
Uber, Ola – It allows users access to transport at their fingertips. One click and the car is at your doorstep. So now to travel in luxury you don’t need to own a car.
Cloud storage – Helps store and backup all your data from the cloud. In future every device will be connected to the cloud and storage space on individual devices will be nill. See an example of this http://www.solu.co/
Netflix – You can get access to million titles with just a minimum subscription fee. So now to enjoy a movie you don’t need to physically own the movie.
Furlenco, Rentmojo- need furniture for you new home. Why buy it when you can rent it for a minimal cost. In future maybe people will be able to rent decors.
Rent the runway – what other commodities can you subscribe to? Clothes, now you don’t need to own designer dresses you can get access to it for a small subscription fee. http://bit.ly/2iibzVa
Zoomcar – self-drive cars. It eliminates the hassles of car insurance and car maintenance. So now with just a marginal amount you can own cars.
WeWork – you can subscribe a membership to an office or a coworking space. Now only pay for the time you use the office. Remove all the hassles that come along with maintaining the workspace.
Slowly and steadily the world is drifting towards more of accessibility and less of ownership. There are perks and emotions attached with owning a commodity. But these emotions are short lived. What comes after these emotions die out, is the shear disutility of owning the commodity.
In this constantly changing environment if one has to constantly run to manage commodities. One may gain in the short term but he is going to loose out on the long game.
Like Charlie Munger said
“The company that needs a new machine tool, and hasn’t bought it, is already paying for it.”