Are you deciding between joining a coworking space or incubator, and working from home? If so, this article is written for you. Both options have their pros and cons but for fast-growing startups, there are plenty of reasons why working out of a coworking space makes sense.TL;DR: community, in-house expertise, mentorship, exposure and cost & flexibility. Read on to learn more.
If you’d like to skip directly to the benefits, here they are:
- Community and like-minded entrepreneurs
- In-house expertise and connections
- Mentorship and guidance
- Exposure to media and relevant groups
- Cost and flexibility to grow your team
The difference between coworking spaces and incubators: as we’ve detailed in our article on Sydney’s best coworking spaces, there’s a confusing distinction between coworking spaces and incubators. For the sake of simplicity, we use the phrase “hub” to describe both coworking spaces and incubators in this article.
In the end, what matters is gaining the support and space you need to grow yourself and your company. Below we’ve listed several benefits of joining an incubator or coworking space in Sydney vs. working from your garage or studio apartment.
Also, at the end of this article, we’ve included a short guide on how to choose the best coworking space for you.
One of the top reasons why people decide to join a hub is to be part of a community. A great community allows you to tap into other people’s ways of thinking, learn new ideas, make friends and gain support during the highs and lows of your startup journey.
As Bahama Brown founder Matt Kocaman explains: “The importance of being around other like-minded entrepreneurs is often underrated by those who haven’t worked in a coworking space. But the benefits are substantial.”
In a coworking space with a strong community, a few benefits result:
- Accountability to your peers: in your lunch breaks and downtime, your conversations will naturally turn towards the progress of your company. These small conversations, as well as the support of the coworking staff, will help keep you accountable and motivate you and your team to accomplish things. Since the rest of your peers will be working, this will in turn push you in difficult spots on your startup journey.
- Different work environment: especially for solo entrepreneurs, the ability to work outside of the home—even for a day, can increase your productivity.
- Mental support: being around a community means you’re able to share stories about the ups and downs of running your business. Although it doesn’t change the situation, sharing the story helps make the situation feel less overwhelming especially when others have been through similar experiences.
- Social events: activities such as hackathons, university events and speaker nights allow you to network with a wider network in an organic way, helps you keep in touch with other founders and promotes interesting ideas that might unlock new approaches to try for your startup.
- People to bounce ideas off of: occasionally you might be stuck on a specific problem—whether it’s web design or Facebook advertising. With the help of other people, you can solve these problems within hours, if not minutes through a simple conversation.
Rinat Sadykov, founder of Chinese B2B travel platform Cozitrip had this to say about working out of Haymarket HQ:
“Learning I found, was the biggest reason for being here. I picked up lots of small things such as talking to Duco van Breemen (General Manager at Haymarket HQ) about marketing and PR, Marty Spargo (founder of REIZE) on SEO, speaking to similar startups such as iTrip, and having special access to speakers at events.”
“Especially starting from scratch, you need other people to learn from. When you’ve only got a small number of employees and you’re working in a garage, it can be really easy to get stuck on something and not know what to do.”
The net result is that the support you gain from a community helps you and your business grow. It’s rare to meet other co-founders when you’re by yourself, but at a startup hub you’re able to work with like-minded people that have similar goals. Not only does this translate into strong relations with your fellow entrepreneurs, it also creates a sense of belonging to a wider community.
Related Article: How to scope out the Shenzhen startup scene by Marty Spargo. He gives an impression of what it’s like to work out of a coworking space in China’s hardware capital.
Note: check if your hub offers these services.
Many of today’s coworking spaces and incubators are specialised in a specific field: from hubs focused on creative freelancers to hardware and fintech hubs. Or, in the case of Haymarket HQ, focused on a geographic region: Asia.
It’s important that you choose a hub that fits your industry, specialisation or geographic focus. Why? Because having the option to tap into your hub’s in-house expertise and connections can significantly speed up your growth.
For instance, when Rinat needed a startup lawyer, he asked another founder who brought up a contact within five minutes. A similar Google search would’ve brought up countless well-marketed options, but weeding through the results would’ve taken weeks.
As Rinat explains: “In those situations, I usually go to someone who’s done it before and ask them: “Hey! You did this before. Can you help?” Unless you have a 40 person company with people all over the world, sourcing ideas from other people is just very hard to do by yourself.”
These small bits of information can also prove useful if your startup is launching in a non-transparent market. For instance, the Chinese market is difficult to enter without relevant government and industry partners. A startup hub that specialises in these areas can help speed up the growth of your company simply by connecting you to the right people and focusing on legal and cultural blind spots you may have overlooked.
Hubs can also offer guidance and assistance in applying for grants (that you may not have been aware of). If you are a NSW-based startup, we highly recommend you have a look at this document created by TechSydney that details the grants that are available to you as a startup founder. And if you find yourself applying for grants without success, have a read through John’s article on the most common mistakes when applying for grants.
Mentorship and guidance
Note: check if your hub offers these services.
Most incubators and specialised coworking spaces offer mentors and in some cases that of an in-house entrepreneur or investor. This is great in theory, but in practice, the usefulness of a mentoring program depends on the effort you invest in it and the quality, not the quantity, of the mentors. More is not always better.
Depending on the hub you join, staff will make an effort to connect you with relevant people and mentors. To give you an example, as part of the onboarding process at Haymarket HQ, we sit down with each founder to understand their priorities, wants and how we can add value. This includes connecting founders to our mentor network and doing regular check-ups on their progress. We also have a “resident investor” that provides advice and guidance to our members.
When picking a hub it’s therefore important to understand if and how they can support your company grow. For example, if you’re based in Sydney and you’re active in the financial technology sector, Stone & Chalk and Tyro Fintech hub are worthwhile having a chat with. if you’re looking to commercialise your technology, you might want to have a chat with Cicada Innovations.
From our experience, the right guidance enables you to grow your company faster and avoid common pitfalls i.e. don’t underestimate the value of quality mentors and pick a hub whose expertise aligns with your company’s goals.
Exposure to media and relevant groups
Coworking spaces and incubators are innovation hotbeds and consequently attract the attention of media, investors and various other parties. By locating yourself in a hub you’ll have more opportunities to interact with these parties, which in turn may benefit your business.
Your hub may also host high-profile events. Late last year, we ran the Alibaba Cloud Pitch Competition which attracted a host of high-level attendees from the government and private sectors. Because investors, accelerators and large corporates from across the country attended, the event proved to be highly relevant to our members. You may find your chosen startup hub also hosts these types of events, which give you the opportunity to network with people that are relevant to your business.
Cost & flexibility to grow your team
Depending on the size of your team and your projected growth, coworking spaces may be more suited to your company than leasing a private office.
Because many startup oriented hubs are not-for-profit and either state-supported or receive corporate sponsorship, they are able to offer more competitive rates than commercial real estate companies.
Aside from having a lower price point than renting your own offices (this depends on the size of your team), hubs offer the added benefit of managed facilities, perks in the form of free services and products, and if you’re lucky a ping-pong table.
More importantly, coworking spaces offer the flexibility to easily decrease or increase your desk count without having to move offices and usually work on a month-by-month contract versus long-term commercial leases.
How do I find the right coworking space for me?
The most effective way to figure out which coworking space or incubator is good for you is to simply go for a trial and visit some of their events.
Narrow down your options to the 3-4 most relevant hubs for your startup, and spend a day or so at each hub. You may have very specific criteria, but in the end the intangibles such as vibe and culture are just as important and you can only experience that by giving it a go.
Check out article on the 14 best coworking spaces in Sydney, Australia if you’re a startup based in Sydney, we hope this article will be helpful to you in choosing the best coworking space or incubator for you.