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Idealog—in the ideas business

Coworking 2.0 gains traction down under

Working in your pyjamas may sound like living the dream, but it can be a lonely way to operate, to say nothing of the countless distractions. Sure, there’s always the local café, but there are only so many lattes one can consume in a day. What’s a freelancer or budding entrepreneur to do?

Enter the trend of coworking: operating out of shared spaces where office resources are pooled and members work in a similarly collaborative fashion.

The definition is loose; some spaces target people in particular industries, some host events, others offer hot-desking or various membership levels, and offices can consist of anything from enormous open plan spaces to several smaller units.

Granted, it’s not an entirely new concept, but previous shared offices tended to be heavily corporate or IT-focused. While the movement is still in its infancy in New Zealand, a few new dedicated coworking spaces are on the make in the main cities.

Generator, a two-storey New York loft-style space at Britomart, bills itself as a private club combined with a shared workspace. Founded by Ryan Wilson and Scott Kuegler early this year, it’s also home to Kea New Zealand – a global network of Kiwi expats. Wilson says the value for users is a lack of setup costs and hassles.

“You have no infrastructure – you don’t have to buy a printer, get internet set up, keep calling the tech guy. I would argue there’s not a better environment in Auckland.”

He likens Generator membership to a gym membership, which includes access to full office facilities, a café, lounge and showers for those lunchtime workouts. There’s also the social aspect. Likeminded people can network, bounce ideas off one another, and collaborate on projects. People in the space, says Wilson, tend to be driven, dynamic and ambitious, with similar hurdles.

Ryan Wilson and Scott Kuegler run Britomart-based GeneratorRyan Wilson and Scott Kuegler run Britomart-based Generator

Up town, BizDojo is housed in K Road’s Ironbank building and has a second presence in Wellington. A key element for its residents is the community manager, whose role involves driving their development by providing advice, resources and contacts.

“It’s the everything to everyone – a little bit of life coach meets business support person meets parent or annoying older sibling,” says founder Nick Shewring. “It’s a very hands-on role.”

Members also benefit from its partnerships with agencies like Auckland Tourism, Events and Economic Development and Grow Wellington – that working relationship enables them to tap into further support and funding.

Shewring says driving business growth has to be a regional effort, but he’s reluctant to label BizDojo as an incubator. Many of its residents, however, have graduated from places like the Icehouse and CreativeHQ before joining BizDojo.

Co-founder Jonah Merchant says there’s a gap in the market for startups post-inception, but prior to their major growth curve.

“There’s this kind of middle ground where they don’t yet quality for NZTE assistance,” he says – and that’s a space BizDojo fills.

That’s not to say all coworking spaces are filled with young guns starting out. There are also plenty of highly-experienced and often highly-specialised freelancers, which naturally results in mentoring.

There’s another sort of resident, too: individual employees from large companies seeking a more inspiring environment for some or all of their office hours, particularly those in more creative disciplines, such as marketing, where they might be the sole staffer in their department.

“Rather than have them sitting out in a production plant away from creativity they’re setting up here," says Shewring.

Jonah Merchant and Nick Shewring of BizDojoJonah Merchant and Nick Shewring of BizDojo

The general consensus is that startups of up to six or seven people are eligible, but beyond that, they’re better off in their own space. Generator has around 90 members, split evenly between permanent residents and casuals; three-quarters of BizDojo’s pool are full-time, with a total of 40-50 forming the “sweet spot” for the community.

“Beyond that it starts to fracture a little bit,” says Shewring, adding that it’s not about trying to fill as many spaces as possible. “We’re not a real estate agent. It’s about finding the right people to complement the community and then help the entire community to develop.”

Turnover is extremely low – around 1-2 percent.

“Usually with coworking spaces in the States, their idea is to scale bigger and bigger in one space, packing it full of more humans. For us we, we get to capacity point quite quickly and then it’s about scaling other regions to help the growth of residents rather than just making our space bigger.

“We could have a space with 200 people easily but I don’t know if we ever would – it goes against that collaboration thing we’re working on.”

Wilson says while Generator doesn’t want to be seen as overly exclusive, it’s vital to get the mix of residents right – and it’s always a mutual decision. The membership can “make or break” the community, which he says is developing its own character as it grows.

“We have a ‘no wankers’ policy,” he says. “You’ve got to make sure there’s a practical fit and a cultural fit.”

At BizDojo, the majority of new members are referrals. The target demographic, according to Merchant, is TEDS, which stands for tech, entertainment, design and sustainability.

Both companies intend to branch out into other revenue streams – which they won’t specify at this point – but building up a solid base of residents is the first step. Merchant says BizDojo’s escalation in Auckland and Wellington is now allowing it to look at “additional layers” to add to the business model.

Wilson believes we’re on the cusp of a seachange– and a quick browse of sharedspace.co.nz (a project that sprang from BizDojo) demonstrates just how many companies are getting on the collaborative bandwagon. It’s a good model for Kiwis, given the proportion of SMEs that make up our economy.

“I think to a greater or lesser extent you’re going to see this across the whole office leasing model.”

Big plans are afoot. Having just raised a fresh round of capital, Wilson says expansion into Wellington is on the cards; Shewring plans to have a Christchurch space up and running any day now and is in talks with Kiwi tech hub the Landing Pad, where BizDojo hopes to set up shop and enable New Zealanders to connect more easily with key US contacts. Beyond that, both intend to follow suit in Asia, Australia and the UK in coming years, establishing truly global networks.

Inside Generator

Inside BizDojo

Is sharing caring?

Do open-plan offices in fact foster innovation and creativity? A 2008 academic paper by Victoria University’s Stephen Cummings and Torkild Thanem and Sara Värlander of the Stockholm University School of Business challenged that notion. Creativity lost? The power relations of open office space design argued that they in fact enabled surveillance and control of staff by colleagues and managers and led to the formation or reinforcement of cliques.

However, its conclusion was based on corporate case studies involving a call centre and a pension specialist – a far cry from the more democratic coworking model.

BizDojo resident, Ministry of Green director Rebecca Mills, believes working alongside fellow entrepreneurs encourages innovative solutions. While she has worked in other shared spaces overseas, none brought together people from such a wide range of industries and experiences. Mills says that diversity makes for richer collaborations and the ability to approach problems from different angles.

Generator has four separate office spaces, with creative and tech types occupying separate areas from the more sales-oriented residents.

Wilson says the groups simply have different ways of working and need to be catered for accordingly.

“By the same token, bringing those different types of people together in this kind of space creates a kind of social friction or intellectual friction and that’s a good thing,” he says.

“I liken it to being on a board where you have all the same type of people – you never get anywhere because everyone has the same ideas.”

In the workplaces studied by Cummings, Thanem and Värlander, employees often established their places in the open-plan offices by ‘marking their territory’ with posters, slogans and personal artefacts.

The artwork that adorns the walls of BizDojo is all done by members, because as Shewring says, ultimately the space is theirs to work in. Even the BizDojo identity and brand, down to the distinctive panda logo, was created with input from them.

Shewring says people like the stability of having a consistent space to work from – there are BizDojo residents with full-time memberships who only come in part-time.

“Even our guys that hotdesk like to come back and try to sit in the same spot. I think it’s human nature.”

CO-WORKING IT OUT

Auckland

BizDojo
Generator
Enterprise Lab

Wellington 

Altspace
BizDojo
Jelly at Boost

Christchurch

Epicentre

Nelson

Nelson Business Centre

Originally published in Idealog #36, page 24

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