Thinking about starting a coworking space? You're tapping into one of the most significant shifts in how we work. But let's be clear: a coworking space is so much more than desks and Wi-Fi. It's a business model built on community, flexibility, and service. It's a hospitality business where your product is a productive and inspiring environment.
This isn't just about leasing real estate; it's about building an ecosystem. You’re creating a hub where freelancers, startups, and even major corporations can thrive. For you, the operator, it’s a dynamic business with recurring revenue streams and the chance to build a real community asset.
This guide will break down everything you need to know. We'll move past the simple definitions and dive into the mechanics, models, and magic that make a coworking space successful.
The big idea: What is a coworking space, really?
Let's start with a clear, simple definition perfect for a search engine snippet.
A coworking space is a business that provides a shared, flexible workspace environment to individuals and companies on a membership basis. Unlike a traditional office lease, coworking offers flexible terms and includes amenities like internet, meeting rooms, and coffee as part of the service.
But for you, the future coworking space manager, that definition is just the start. The true essence of coworking lies in three core pillars:
- Community: This is your secret sauce. A coworking space is a place for connection. It’s an environment designed to combat the isolation of working from home and foster networking, collaboration, and learning.
- Convenience: You handle the hassles so your members don't have to. You manage the internet, buy the coffee, clean the kitchens, and unjam the printer. Members get a turnkey, professional office experience without the administrative headaches.
- Cost-effectiveness & flexibility: For your members, there are no long-term, high-cost leases. They can rent a single desk or a 10-person office, scaling up or down as needed. This flexibility is a massive draw for modern businesses.
The concept was born out of a simple need. In 2005, a software engineer named Brad Neuberg launched the "San Francisco Coworking Space" in a feminist collective called Spiral Muse. He wanted to combine the freedom of freelancing with the community of an office. It started slow, but the idea he sparked has become a global industry. According to 360iResearch, the coworking market is set to be worth over $48 billion by 2030 as flexible work becomes the new normal worldwide.
Coworking vs. co-working: Why a tiny hyphen matters
You'll see both spellings, and it's important you use the right one. For years, media outlets used "co-working." However, the industry has universally adopted coworking (no hyphen).
In March 2018, the AP Stylebook officially dropped the hyphen. Today, the terms have different meanings:
- Coworking: Working in a shared space with people from different companies and professions. This is the industry you're in.
- Co-working: Refers to colleagues from the same company working together, just not in their main office.
Using "coworking" shows you're in the know.
The heart of your business: Understanding your future members
Your space is nothing without its members. Knowing who they are and what they need is critical to your success. Your target market generally falls into four key groups:
1. Freelancers & solopreneurs
These are your classic members. They're writers, designers, consultants, and developers seeking an escape from the isolation of their home office or the chaos of a coffee shop.
- What they need from you: A professional address, reliable Wi-Fi, a sense of community, and networking opportunities to find clients.
2. Startups & small businesses (SMEs)
These teams of 2-20 people need a professional home without the commitment of a 5-year lease. A coworking space is their perfect launchpad.
- What they need from you: The ability to scale their office space up or down quickly, access to meeting rooms, and a vibrant community to hire from and partner with.
3. Remote workers
These are employees of larger companies who work from anywhere. Their employer often pays for their membership as a perk and a way to ensure productivity.
- What they need from you: A professional, distraction-free environment, private phone booths for calls, and a social outlet that their remote job lacks.
4. Corporate & enterprise teams
Large companies like Microsoft, Google, and HSBC now use coworking spaces as flexible hubs for satellite teams, special projects, or as an alternative to opening a new regional office.
- What they need from you: Branded private offices, high-security IT infrastructure, access to premium meeting rooms, and locations in prestigious business districts.
10 types of coworking space members
The business model: How coworking spaces actually make money
Your revenue comes from two primary sources: memberships and ancillary services. This is the "Space-as-a-Service" model.
Core revenue: Memberships
- Hot desk: The entry-level option. Members can sit at any available desk in a common area. This is a pay-as-you-go or monthly subscription service ideal for freelancers.
- Dedicated desk: A member gets their own personal desk in a shared area. They can leave their monitor and equipment set up. This offers more stability and is popular with full-time remote workers and small business owners.
- Private office: A fully enclosed, lockable office for teams of 1 to 50+ people. This is your most lucrative offering, providing privacy while still giving members access to the larger community and amenities.
10 coworking membership plans to boost your revenue
Ancillary revenue: The high-margin extras
This is where great operators maximize profitability.
- Meeting room rentals: Charge an hourly rate for members and non-members.
- Event space: Rent out your common areas in the evenings or on weekends for workshops and corporate events.
- Virtual office: A huge growth area. Offer a business address and mail-handling services for a monthly fee. This provides a professional image for home-based businesses.
- Day passes: Allow people to try your space for a day for a flat fee.
- Printing, coffee, snacks: While basic coffee might be free, you can charge for premium espresso drinks, snacks, or advanced printing services.
Finding your niche: The major types of coworking spaces
You don't have to be everything to everyone. The most successful spaces often cater to a specific niche.
1. The generalist space
The classic model, open to all professionals. It offers a mix of hot desks, dedicated desks, and private offices.
2. The high-end / premium space
Located in prestigious downtown buildings, these spaces offer luxury amenities, concierge services, and beautiful design to attract corporate clients.
3. The niche-specific space
Focus on a particular industry or demographic. This builds a powerful, targeted community. Examples include:
- Makerspaces/hackerspaces: For those who need tools, 3D printers, and workshops.
- Women-centric spaces: Providing a supportive environment for female entrepreneurs.
- Wellness-focused spaces: Integrating a gym, yoga studio, or meditation rooms.
- Parent-friendly spaces: Offering on-site childcare.
- Industry-specific hubs: Spaces dedicated to lawyers, artists, or tech startups.
4. The rural / destination space
Located in the countryside or vacation spots like Bansko, Bulgaria, these spaces cater to digital nomads and combine coworking with co-living.
Bansko nomad fest and the rise of coworking in Bulgaria
The engine room: Core components of a successful operation
A great coworking space runs on three pillars: people, technology, and place.
1. Community management (people)
This is your most important investment. A community manager isn't a receptionist. They are the host of the party. They connect members, organize events (from workshops to happy hours), and actively build the culture that makes people want to stay.
2. The technology stack (technology)
Modern spaces run on software. At a minimum, you will need:
- Coworking management software: This is your command center. Platforms like Spacebring automate billing, meeting room bookings, member communication, and access control. It saves you immense administrative time and provides a seamless experience for your members via a mobile app.
- Access control: Forget physical keys. Use app-based or keycard systems to grant 24/7 access to members, which is a major selling point.
- Reliable, high-speed Wi-Fi: This is non-negotiable. Invest in a robust, secure network that can handle dozens or hundreds of users simultaneously.
Generate recurring revenue and offer exceptional customer experience at your shared or coworking space
3. Space design & amenities (place)
Your physical space must be both inspiring and functional.
- Zoning: Create different zones for different work styles: quiet heads-down areas, collaborative lounges, and private phone booths.
- Ergonomics: Invest in good chairs and desks.
- Core amenities: Flawless internet, great coffee, clean bathrooms, reservable meeting rooms, and printing facilities are the bare minimum.
Why it works: The value proposition for members & operators
You need to understand the "why" to market your space effectively.
For members
- Flexibility: No long-term leases.
- Productivity: A professional environment free from home-life distractions. Studies show nearly 90% of coworkers are happier since joining a space.
- Networking: Proximity to other professionals creates opportunities for collaboration and new business.
- Creativity: A new environment and diverse perspectives can spark fresh ideas.
For you, the operator
- Recurring revenue: The membership model provides predictable monthly income.
- High-demand industry: You are serving the modern, flexible workforce.
- Asset optimization: You can generate significantly more revenue per square foot than a traditional single-tenant lease.
- Impact: You are building a tangible hub that helps local businesses and professionals succeed.
Inspiration: Famous companies born in coworking spaces
The model works. Some of today's biggest companies were developed in the collaborative environment you're looking to create:
- Uber: Started by Travis Kalanick and Garrett Camp out of a coworking space in San Francisco.
- Instagram: Kevin Systrom and Mike Krieger built the first version of the photo-sharing app at a coworking space.
- Indiegogo: The crowdfunding giant was born when co-founder Danae Ringelmann was working out of a shared space.
The bottom line: What should you charge?
Pricing is hyper-local and depends on your city, location, amenities, and brand.
- The global average monthly price for a hot desk is around 274.
- However, this varies wildly. A hot desk can cost over $500/month in New York City, around $300 in Berlin, and closer to $150 in Bangkok, so your local market is the biggest factor in setting your price.
Do your research. Analyze your local competitors. Price yourself based on the value, niche, and premium experience you offer. Remember, in many cases, a member's company covers the expense, so B2B clients are often less price-sensitive than freelancers.
Your next step
You now understand that a coworking space is a dynamic, hospitality-driven business. It's a blend of real estate, technology, community building, and event management. It’s not a passive investment; it's an active enterprise that rewards creativity and a deep understanding of your members' needs.
The journey to opening your doors starts with a solid business plan, a deep dive into your local market, and a clear vision for the community you want to build. You're not just offering a desk—you're offering a destination for success.
Ready to take that next step and turn your vision into a reality? For a detailed breakdown of the entire process, read our comprehensive guide.
