Is coworking (really) the future of work?
If you’re reading this while at work—take a beat and look up. Are you at the office? Maybe you’re surrounded by three walls and a sliding door, or tucked in your cubicle amid a mountainscape of padded partitions, or bobbing in an open-floor-plan-sea of desks? Or perhaps you’re grabbing a quick mocha latte from an on-site café before heading back to your coworking nook? Or maybe you’re WFH (admit it, while wearing those stretched out pair of sweats—err, perhaps that’s just me)?
Where we work—and how that impacts our work—are questions that companies are rethinking. From startup newbies to decades-old enterprises, businesses are letting go of the strict “must own/lease space and put all employees in that space eight hours a day, five days a week” model.
Some are harnessing the catalytic culture and vibe of coworking spaces. Others are tapping into tech’s connectivity, helping remote employees stay tethered to the company while working from home. Some are developing an office-and-remote hybrid. Many are doing a combination of all of the above. Whatever the mix, forward-thinking companies are all helping shape the answer to: what is the future of our workspaces?
Coworking is not the holy grail we thought it was
Let’s start with coworking. If you’re new to the concept, think well-appointed office digs with workstations that allow individuals to plop down wherever with their laptops, all the way up to customized multi-office space for larger teams. Coworking spaces typically provide the “extras,” like conference rooms, video/phone booths, cafés and coffee bars, along with culture-oriented elements like after-hours soirées, yoga, art classes, and more.
Although people typically associate coworking with freelancers and startups, Fortune 500 and enterprise companies such as Salesforce, Microsoft, UBS, and others also utilize coworking spaces. It makes sense. They’re essentially beautiful office space, plus amenities, plus community all included in a turnkey package.
First appearing in 2005, coworking is a relatively new phenomenon in the “how we work” continuum. The lore goes that after a healthy sesh with his life coach, software engineer Brad Neuberg launched San Francisco Coworking Space with the altruistic hope of adding a sense of community to collective workspaces. That same year, The Hub (the forerunner to global coworking leader Impact Hub) got its humble coworking start in a London loft.
Within 15 years, the coworking sector has mushroomed. In the US, CBRE reports indicate that between 2010 and 2018, flex office space (the industry term that includes coworking space) experienced an average annual growth rate of 26 percent. Worldwide today, there are approximately 33,000 coworking spaces, with an anticipated 49,500 by 2022.
Around mid-2019, global coworking giant WeWork boasted 425 locations in 100 cities as it headed for a buzzy IPO with a valuation of $47 billion filed in an S-1 by its larger-than-life cofounder and CEO, Adam Neumann. But then there was that little IPO failure last fall. The one that made international news; resulted in the exit of Neumann (who jumped with a $1.7 billion parachute from his role as chairperson of the board); dominoed into layoffs of 2,400 employees by late November; and left lots and lots of not-so-glowing articles, blog posts, and industry distaste in its wake.
(If you’re curious, you can start with Business Insider’s collective of articles chronicling the debacle, then jump on over to a Reddit thread with more than 2,500 comments including tidbits on the free-flowing kegs, DJ, and limitless swag at a Brooklyn WeWork before the company tightened its belt.)
Finding a balanced way for employees to work
After WeWork’s fall from grace, some have asked: Is coworking dead?
If industry growth is any indicator… nope. CBRE’s latest forecasts indicate a 23 percent growth in 2019 and 13 percent in 2020, with a total of 87 million square feet in flex office inventory by the end of 2020. In Utah, big players like Impact Hub and WeWork are going strong, with several locally-owned coworking spaces thriving as well.
One of those local spaces is Kiln, with offices in downtown Salt Lake City and Lehi, where the vacation rental software company Janiis has been headquartered for almost three years. Jason Hahn, the company’s cofounder and CEO, says that during the startup’s first year in business, company meetings were held at his house. “My kitchen became the unofficial conference room. We bought a whiteboard and put it on the wall; we’d make coffee. We used my home as the main base if we needed it, otherwise, we would all telecommute from home.”
Hahn connected with Kiln CEO, Arian Lewis at a Kickstarter event in 2017 and then decided to move Janiis headquarters out of his kitchen and into Kiln. “It felt like the perfect time for us. We weren’t ready to sign a huge lease. Coworking put us in a position to gather in a more professional way, have a space for clients to come by. Now, we have a dedicated six-person area at Kiln. We utilize the conference rooms and bikes, callboxes, and whiteboards. We’re also super tight with the group here who work at Kiln, so we feel at home here.”
He goes on to enumerate one of the things that is a common draw for coworking spaces: “As a CEO of a startup that is still trying to prove itself, it is difficult to come up with activities to add to the culture and places like Kiln assist you with that. You can leverage off them for a while, instead of focusing on making it a cool place to work, [Kiln does] that for you.”
One of those cool things Kiln recently hosted for its members was a Star Wars event, which included a Baby Yoda costume contest and a private screening of Star Wars: The Rise of Skywalker. Jake Reni, vice president of revenue and growth for Tiled, says events like that are part of the reason he chose Kiln as the space for his team.
Tiled is a San Diego-based microapp platform company, with a satellite office at Kiln’s Salt Lake City space and a few remote employees working from home across the country. He explains, “They have events and activities, and they make it open not only to the members, but to our families too. My kids were bummed when I left Adobe—Adobe’s Halloween was epic. But at Kiln they did a charcuterie on top of a big skeleton across the kitchen, that was cool for my kids. Where my company might fall short on budget for these activities, Kiln supplements your own culture.”
Like many coworking members, as Tiled has grown, so has the space his Utah team occupies at Kiln. “We started with what they call their base member pass, moved to an eight-person office, and now we’re in a 15-person, two-story office.”
The new boss-employee relationship is all about trust
Reni has since honed his answer to the “how we work” question with a mix of coworking and remote working. “Mondays and Fridays we work from home, Tuesday through Thursday we work at the office.” He says this approach fulfills one of the company’s core values: balance. “That commitment to balance means a lot to me coming from a [company] where they chose ‘work/life integration,’ meaning you could be working at your son’s soccer game. But I don’t want to be working at my son’s soccer game. I want to coach my kid’s soccer team, being present in the moment.”
The balance thing sounds good, but does he ever worry those work-from-home days can lead to lower productivity? “If that’s your mindset, you have to reevaluate who you’re hiring, because trust is a bigger problem. If you build a foundation of trust, I don’t care if they’re working from home or the office, I know they’re going to get their [expletive] done.”
He’s not the only Kiln tenant with that philosophy. Janiis has a similar coworking/remote mix, as does Daily Harvest, a New York City-based healthy food delivery company. In 2018, the company opened its main customer care division in Salt Lake City, with offices at Kiln.
Lynda Harvey, Daily Harvest director of care, says, “Our employees spend their onboarding period at Kiln. Once they get used to the job, the majority of them then go home. We’ll pull people back to the office periodically. We found people felt a little isolated at home, so bringing them back in every now and then is a great way for them to trust in their relationship with their managers and peers. There’s this amazing thing about empowering employees to work from home—they feel trusted, and because they feel trusted, they produce better work.”
Simplus has similarly found the trust factor to be the key to their success. The Salt Lake City-based Salesforce quote-to-cash implementation partner has around 500 employees around the world. With offices and coworking spaces in nine major cities, Simplus empowers most of its employees to opt for a work-from-home and in-the-office blend.
Kathy Brown, Simplus’ human relations manager, says the remote-friendly environment is the main reason for Simplus’ sky-high employee satisfaction ratings. (In fact, Simplus just won Utah Business’ Best Companies To Work For award.) “Our employees are really happy with the flexibility. A huge benefit of that is allowing employees to feel like they’re being trusted. Our attrition rate is crazy low. People don’t leave.”
Method Communications, a Salt Lake City-based global public relations and marketing firm, has evolved its own office/remote hybrid over the years. Jacob Moon, Method Communications’ cofounder and general manager, says the company started with general flexibility for employees to take needed time for family events or to work from home on snowy days. As the company has grown and hiring and retention became critical, Method has established an official policy called Method Anywhere.
“It’s part of being able to find the right talent,” says Moon. “We’re not as concerned about them being able to work in our San Francisco or Salt Lake or New York office. We’d rather know they’re the right person for the job instead of worrying about where they live.”
The new retention method is remote work
Retention was the reason Stanford University took a chance when they allowed Susan Simpkins to work remotely to continue her role as director of proposal advancement for its SLAC National Accelerator Laboratory. Simpkins explains that Palo Alto’s high cost of living and the birth of her first child caused her and her husband to relocate. When she let the university know she would be leaving, her boss wondered if they couldn’t figure out a remote scenario, so they tried it out for six months.
Three years later, she is still managing her team in Palo Alto from her coworking space at Salt Mine in Sandy, Utah. She travels to the university every four to six weeks and has successfully established the university’s trust in the benefits and efficacy of remote working. Simpkins says tools like Zoom and Slack keep her connected to her team on a daily basis, and jokes that because her team was so spread out on campus, they Zoomed and Slacked much of the time when she worked on location anyway.
Every company I interviewed for this article mentioned remote work. Whether companies are based in offices or coworking spaces, everyone is adopting at least some element of work-from-home flexibility, which means the future of working is making remote working part of the mix.