5 Ways Coworking Impacts Small Business Growth Not just a cute place to work.

Image courtesy of 25N Coworking.

It’s no surprise that coworking spaces serve as home-office alternatives for independent professionals or as local hubs for innovation and entrepreneurial activities. And, yes, there are “Think Tanks,” networking events, and one-person software developer companies. However, coworking spaces have broader cultural and economic impacts that can influence small business economic development on an exponential scale — whether it’s in the context of an urban high-rise or small-town suburb.

1. Coworking spaces build sharing economies.

One of the coworking movement’s most important roles is to remove barriers for would-be business owners that are caused by traditional overhead expenses like office space leasing, equipment, and furnishings. By providing shared space and shared amenities in flexible, “build-your-own” packages, coworking is diminishing the impact of expenses and distributing them amongst community members in a way that is fully-customized to their business needs.

2. Coworking spaces keep creative talent local.

A byproduct of an emerging sharing economy, the coworking model also generates a creative economy made up of individuals who not only need an inexpensive way to operate, but need a consistent flow of new people, new ideas, and new opportunities. Without this type of engagement, creatives are forced to seek employment elsewhere, such as with a corporation, and this limits their ability to engage with other local businesses that could benefit from top-tier talent on a small-business scale.

3. Coworking spaces boost the local economy.

Communities are discovering that it’s easier to attract 200, one-person companies than it is to attract just one, 200-person company, and these small companies serve as an important economic support structure and talent pool for existing businesses. For example, a local coworking community can effect a significant cash influx, upwards of $20 per member, per day, in direct economic development through regular patronage of local businesses like gift shops, convenience stores, restaurants, bars, and local service-related industries — whereas larger corporations might outsource similar expenses in favor of a volume discount.

4. Coworking provides a platform for small businesses to succeed and grow, even if they don’t need workspace.

Local business like restaurants can also benefit from coworking spaces through direct programming, partnerships, and access to pools of available, independent contractors in industries like interior design or legal services. For example, lunch deliveries from local restaurants provide the benefit of convenience for members and a significant, consistent revenue for participating local restaurants.

5. Coworking spaces create opportunities for globalization.

Another way that coworking spaces boost a local economy is through their flexibility in relation to the remote workforce. Now, thanks to technology, many employees have the ability to work remotely for a larger corporate employer from anywhere in the world, and their choice of “home base” is made much more attractive with the existence of an alternative to working from home. By ensuring that remote employees invest their income locally, coworking can impact small business ecosystems in as powerful of a way as a corporation’s choice of home office location.