Top Trend 2010 #4: Coworking and Startup Incubation

by Nathaniel Whittemore December 15, 2009 09:23 AM (PT) Topics: Co-Working Spaces

I think that 2010 will be the year that coworking environments become a mainstay of professional life and in which place-basd models of startup incubation continue to mature and expand.

As the internet has become a more omnipresent force in our lives, the desire to find settings for real human contact has likewise increased. The last few years have seen an explosion of co-working spaces, and the recognized value of physical proximity has increasingly jumped into the world of startup funding.

Thus far, coworking has been largely centered in places like San Francisco and New York City with a high number of independent, creative professionals. As more and more of the economy goes digital and more and more people turn to self-employment, I believe that you'll see these spaces outside of those tech hubs, as well.

What's more, I believe that the conversation between coworking as a place-based professional style and incubator programs as a path to seed funding will grow more and more vibrant.

Case in point: The forthcoming Unreasonable Institute is part education program, part immersive coworking environment, and part seed funder. What all of it's pieces have in common is a quest for a social density that creates new synergies between enterprise founders and new opportunities for exchange.

In some ways, coworking makes even more practical business sense in the social entrepreneurship space than in other fields. Social entrepreneurs tend to need lots of diverse resources from a lot of different places to make their projects work. Shared work space is an incredible way to build that social capital.

There are certainly some leading actors in this space. The global Hub network, for example, is poised to continue to grow in 2010, and is already experimenting with a different version of seed funding and incubation.

Indeed, The Hub's partnership with Village Capital to run a West Coast Seed fund, and the Unreasonable Institute's partnership with just about everyone to do everything, demonstrate how the notion of shared space is impacting actual organizational models, as well.

(Photo: @citizenspace by hyku)

Nathaniel Whittemore is the founder of Assetmap. Previously he was the founding director of the Northwestern University Center for Global Engagement.

Comments (11)

  • Josh Friedman
    Dec 15, 2009 @ 11:40AM PT
    Josh Friedman

    Great article, Nathaniel. I completely agree with your assertions. We started NedSpace (www.nedspace.com) in Portland, Oregon earlier in 2009 to help entrepreneurs grow their ideas and projects into real businesses. We now have two locations and are looking at ten cities across the US to open in 2010. Even looking at a few cities abroad, too. We've found exactly what you stated in the article: Physical proximity, peer support and mentorship and the collective experience are paramount to entrepreneurs' success.

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  • Kelly Brown
    Dec 15, 2009 @ 02:55PM PT
    Kelly Brown

    Nathaniel,

    I agree.  Great article.  Even in Akron, Ohio @ Office Space Coworking (www.officespacecoworking.com) we're seeing the benefits of Coworking & it's connection to entrepreneurial success.

    We launched in September of 2008 and have grown steadily -- seeing new & exciting businesses launching, interacting & learning from each other.  A very cool dynamic.

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  • Ehon Chan
    Dec 15, 2009 @ 09:19PM PT
    Ehon Chan

    In Australia, we're working on an incubation program called Project Australia, which I used as my project proposal for GES 2010, although fingers crossed, I hope I get in!

    I really agree with what you wrote and definitely a great, great article! I think that we're starting to recognise small projects, I can only see this fueling social innovation even further - projects don't have to be a sustainable venture, it can be a one-off event.

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  • Mike Shoemaker
    Dec 17, 2009 @ 11:21AM PT
    Mike Shoemaker

    Nice article, Nathaniel. Here is a counter argument on co-working from Paul Graham of Y-Combinator. http://bit.ly/dk2eC 

    I don't recall exactly where in the podcast it falls, but the whole thing is good.

    I'd be curious to hear your thoughts.

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    • Nathaniel Whittemore
      Dec 17, 2009 @ 11:48AM PT
      Nathaniel Whittemore

      Hey Mike

      Love PG, so thanks for sharing. Just read the summaries, but it seems like his argument may not be about coworking specifically but more about locally-supported "incubators." Extrapolating a bit, I think what he's challenging is the good intention of throwing a bunch of people together with a fast internet line and occaisionally telling an investor to come by.

      "Incubation" is pretty hard. It's an extremely light touch thing that's more about giving people the right access to resources in ways that they can find, construct and build themselves. Community cultivation is an extremely challenging thing, and is not something that even a well-meaning politician can just decide on.

      That's actually why I think you see many of these coworking spaces coming it at it as a for-profit model. It's not that they're trying to make insane margins, but they reconize that the inherent difficulty of finding ways for folks to work together means that it's going to take a lot of administrative and staff support.

      Of course, other groups are structured as nonprofits, or even just as legally unstructured communities and they still make it work.

      I think his caution - if I'm reading it write - is a good one. Diaggregating the pieces of what makes an incubation process successful would be super important for anyone involved to try to do.

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    • Mike Shoemaker
      Dec 18, 2009 @ 01:58PM PT
      Mike Shoemaker

      The notes are more than a bit hard to interpret.

      It's been a while since I listened to the podcast, but my recollection is that he is pretty anti- having several startups share a space. He'd rather people work out of their apartments...something about the creative atmosphere created by empty pizza boxes...and then come together once a week to share ideas and hear experienced entrepreneurs share their stories.

      It's not much of an argument, but interesting that someone as prominent as Paul Graham would be pro incubator-ish activity and yet anti co-working (if I share your definition of co-working).

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  • Bz Hive
    Dec 17, 2009 @ 06:26PM PT
    Bz Hive

    Great piece. Coworking Rocks . . .that's why we are opening one in San Rafael Calif.  . . . joining the trend of 2010

    www.bzhive.com 

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  • Dave Quinn
    Dec 28, 2009 @ 01:34PM PT
    Dave Quinn

    What size population do you need to support a coworking environment project?

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  • Nic Peterson
    Dec 29, 2009 @ 11:26PM PT
    Nic Peterson

    Nice article Nathaniel. Check out eVenues.com, where we plan to build a 'community' of such unique spaces, bringing the ability to give space 'consumers' the power to search, compare and book unique meeting/event/desk space in flexible time intervals, on demand (giving the customer the freedom and power of choice, and the venue/space provider the ability to market and promote their space similar to how a hotel might by using Expedia or other similar services.).

    For more info, visit:

    http://www.eVenues.com

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  • massimo carraro
    Jan 04, 2010 @ 07:51AM PT
    massimo carraro

    great news, excellent article.

    I'd like to confirming the coworking expansion from an european point of view, coordinating a network of coworking spaces in Italy, now counting 26 points in 13 cities, from rome to venice, turin, milan etc.
    it's called "coworking project by cowo" and can be seen online at http://coworkingproject.com.

    the cowo network started less than a year ago and has grown to a rate ot 2 spaces a month. ain't that something? :-)

    massimo carraro

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  • Janna Bethel
    Jan 11, 2010 @ 10:35AM PT
    Janna Bethel

    Coworking is coming up in Orlando and Nashville too. We have some great spaces and lots of interaction.

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