top of page


Company Formation
Entity Management 
Residency for Entrepreneurs

How to Set Up Your First Coworking Space

Thinking about setting up your first coworking space? Whether you're a freelancer, entrepreneur, or small business owner, creating a productive and welcoming work environment is crucial for success. We'll guide you through the process of setting up your first coworking space in this article. From finding the right location to designing a functional layout, these simple steps will help you create a space where creativity and collaboration thrive. Let's get started!

Understanding the Coworking Space Concept

Definition of Coworking Space

A coworking space is a shared office where people from different companies work together. It has a sense of community, flexible working hours, and resources like high-speed internet and meeting rooms.

Unlike traditional offices, coworking spaces are open and collaborative. Members can network, share ideas, and work together, fostering innovation.

They also have amenities like coffee bars and lounges, creating a comfortable work environment. It's cost-effective for small businesses and startups, providing a professional setting without the financial burden of leasing an entire office.

Coworking spaces align with the modern workforce's desire for flexibility and work-life balance, offering an alternative to traditional office settings.

History and Evolution of Coworking Spaces

Coworking spaces have evolved significantly over time. The first official coworking space was established in 2005, marking the beginning of the modern coworking movement. Since then, the concept has evolved from shared office spaces to dynamic, community-driven environments that foster collaboration and innovation. Factors like the rise of remote work, the gig economy, and the desire for flexible work arrangements have also contributed to the growth and popularity of coworking spaces.

Different types of coworking spaces have emerged, including niche-specific spaces tailored to particular industries or demographics, as well as corporate-led spaces that provide a branded, professional environment for employees and partners. These spaces cater to the changing needs of professionals and entrepreneurs by offering various amenities, networking opportunities, and flexibility in lease terms and office configurations.

Types of Coworking Spaces

There are different types of coworking spaces: open spaces, dedicated desks, private offices, and virtual coworking. Each type serves different professionals and industries.

Open spaces are great for freelancers, remote workers, and startups, offering a collaborative environment with shared amenities. Dedicated desks offer a more personalized workspace for individuals or small teams. Private offices are suitable for larger teams and business seeking privacy and customization.

Virtual coworking is a flexible option for remote or frequent travelers.

When choosing a coworking space, consider factors like location, cost, amenities, community, and specific needs. The location should be convenient and easily accessible. Costs should align with the budget. Amenities and community events enhance productivity and networking.

Value Proposition of a Coworking Space

Coworking spaces offer unique amenities and offerings, setting themselves apart from traditional office spaces. These include access to shared facilities or resources, such as conference rooms, high-speed internet, and office equipment.

Additionally, coworking spaces often foster a strong sense of community and collaboration among members, creating an environment where individuals can work together and share ideas. This is usually communicated through organized networking events, workshops, or social gatherings. The pricing structure and membership options typically vary based on factors such as the level of access to space and amenities, with options for hourly, daily, monthly, or yearly memberships. The value proposition of a coworking space is strengthened by the flexibility and affordability of these options, making it an attractive choice for entrepreneurs, freelancers, and small businesses looking for a professional work environment without the commitment of a long-term lease.

Planning How to Set Up Coworking Space

Research and Understand the Market

Understanding the local market demand for coworking spaces is important for setting up a successful business. Researching the local area's business and economy will provide valuable insights into the level of demand for shared workspaces. Identifying real estate trends and occupancy rates within the city or town can also help determine the need for coworking spaces.

Additionally, understanding local competitors, such as traditional office spaces, other coworking businesses, or remote work options, can provide a comprehensive view of the market. Analyzing their strengths and weaknesses, such as location, amenities, pricing, and community dynamics, can help entrepreneurs identify opportunities to differentiate their coworking space.

Lastly, staying informed about market trends and preferences for coworking space amenities and services, such as flexible memberships, networking events, and wellness programs, can help tailor the business to meet the specific needs of the local community.

Analyze Local Competition

Analyzing the local competition for a new coworking space involves identifying the main competitors in the area and understanding their strengths and weaknesses. Evaluating their specific services and amenities, as well as the pricing structure, is important. This helps in positioning the new coworking space effectively.

By comparing the services and amenities offered by the local competitors to what is being planned for the new space, the management can determine what unique aspects or improvements can be made.

Pricing is also a crucial factor, as it gives insight into the market rates and what potential customers are willing to pay. Taking a closer look at the prices offered by the competition can help in setting competitive rates for the new coworking space.

This analysis allows for a strategic approach in developing and marketing the new coworking space, ensuring a unique value proposition that meets the needs and demands of the local market.

Develop a Business Model

A good business model for a coworking space needs to think about making money, spending money, and offering something special to potential clients.

The money plan could include different prices for different services, like assigned desks, private offices, or shared seating areas. On the spending side, it should account for rent, utilities, staff, and regular upkeep.

To stand out from the competition, the business model could add extra services like hosting events, having in-house help with administrative tasks, or offering bonuses like networking events or health & wellness programs.

To get funding, the plan might involve finding investors, applying for small business loans, or using crowd-funding campaigns.

Each of these things is important for getting new members and keeping the coworking space working well.

Create a Revenue Plan

A coworking space makes money from membership fees, renting private offices, and offering extra services like event spaces. When planning revenue, it's important to think about both variable and fixed costs. For things like utilities and cleaning, a percentage approach works well. As membership goes up, profits go up too.

Rent is a fixed cost, staying about the same each month, and needs to be part of the revenue plan. To increase revenue over time, the coworking space can offer flexible memberships, great internet, and top-notch office perks. They can also host networking events and workshops. Building a strong community and listening to member feedback can help revenue grow in the long run.

List of Expenses

The expenses for setting up and operating the coworking space include:

  • Rent

  • Utilities

  • Furniture

  • Office supplies

  • Internet and phone services

  • Marketing and advertising

  • Insurance

  • Maintenance and repairs

  • Staffing costs

These expenses can be tracked using accounting software or spreadsheets. This allows for easy identification of cost centers and monitoring of budget allocation. Potential cost-saving measures include:

  • Energy-efficient lighting and appliances

  • Bulk purchasing of office supplies

  • Negotiating lower rent rates

  • Outsourcing non-core activities

  • Adopting flexible staffing arrangements

By evaluating and managing these expenses carefully, coworking space operators can ensure financial transparency and accountability. This can be done while maintaining a high standard of service for their members.

Design and Build Your Coworking Space

Select the Right Location

Selecting the right location for a coworking space involves evaluating several key factors.

These include accessibility, nearby amenities, and safety, to ensure the space is convenient and attractive to potential members.

The local demographic and business environment are also important.

High-density urban areas may provide more foot traffic and potential collaborators, while a suburban or rural location may offer lower overhead costs.

Each type of area comes with its potential advantages and disadvantages.

Urban areas may offer more networking opportunities but also higher competition and cost, while rural areas may provide a better sense of community but with fewer professional resources.

Incorporate Effective Design and Layout

Setting up a coworking space involves considering several key elements to create an effective design and layout. These elements include maximizing natural light, creating versatile and flexible spaces, providing ergonomic and comfortable furniture, and optimizing space to encourage collaboration and productivity.

The design and layout of a coworking space are important for creating a productive and collaborative environment. For instance, an open floor plan with designated quiet areas and collaboration zones can encourage interaction and idea-sharing among members.

To ensure that the design and layout of a coworking space meets the diverse needs of its members, strategies such as conducting surveys and gathering feedback, offering a variety of workstations and amenities, and providing customizable spaces for different work styles can be implemented. By incorporating these strategies, coworking spaces can effectively cater to the needs of a wide range of professionals and promote a dynamic and inclusive community.

Procure Necessary Amenities and Technology

To have a successful coworking space, it's important to get the right amenities and technology for the members. This means reliable high-speed internet, comfy furniture, lots of power outlets, and shared equipment like printers and scanners.

It's also good to have a well-equipped kitchenette, meeting areas, and soundproof phone booths. Landlords or property managers should talk to commercial office suppliers, furniture rental companies, and technology providers to get these things.

They can do this by getting quotes, negotiating contracts, and making sure the chosen vendors can give ongoing maintenance and support. By doing careful research and thinking about the needs of the coworking space, it's possible to find a good balance between quality and cost. This will make a productive and inviting environment for all members.

Securing Funding for Your Coworking Space

Options for Funding a Coworking Space

One way to fund a coworking space is by using traditional sources. This can include getting a bank loan, applying for small business grants, or seeking investment from private equity. Another option is to create partnerships with real estate developers or property management companies to secure funding.

Using crowdfunding platforms is also a strategy. These platforms help connect with potential investors who are interested in supporting coworking space development.

To attract investors, it's important to create a detailed business plan. This plan should outline the vision, target market, financial projections, and the benefits of investing in a coworking space. Providing evidence of the growing demand for flexible workspace solutions and the potential for a strong return on investment can attract potential investors.

Pitch to Potential Investors

The coworking space offers a flexible and cost-effective workspace for freelancers, small businesses, and remote workers. It provides amenities like high-speed internet, meeting rooms, and networking opportunities. This attracts potential investors due to the high occupancy rate and steady rental income.

To secure funding, alternative strategies like angel investors, venture capitalists, or crowdfunding platforms can be used. Investors can contribute to the business's growth and success in exchange for equity or rewards.

The revenue plan will detail membership fees, rental revenue, and potential partnerships, while expenses will cover setup costs, operational expenses, and marketing budget.

During the pitch, a clear and transparent presentation of the revenue plan and expenses will showcase projected profitability and return on investment.

Alternative Funding Strategies

Launching and managing a coworking space can involve using alternative funding strategies like crowdfunding, angel investors, and peer-to-peer lending. Crowdfunding allows many people to contribute small amounts of money online to support a project. Angel investors are wealthy individuals who invest in startups in exchange for ownership or debt. Peer-to-peer lending connects individuals who want to borrow money with those willing to lend it through online platforms.

To attract potential investors, a coworking space should focus on presenting a strong business plan, outlining market potential, explaining how it will become profitable, and showcasing what makes it unique from competitors. Offering detailed financial projections and discussing potential returns on investment can help persuade angel investors. Furthermore, networking, attending industry events, and building relationships with potential investors can also help secure funding through alternative methods.

Launching Your Coworking Space

Purchase Supplies for Your Space

Consider purchasing comfortable and versatile furniture such as desks, chairs, and storage solutions to maximize the space and cater to the varying needs of those using the coworking space.

Investing in quality internet connectivity, printers, and other office equipment is crucial to ensure productivity and efficiency.

One way to determine the quantity of supplies needed is by estimating the maximum daily capacity of the coworking space and factoring in the number of workstations, meeting rooms, and communal areas.