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Profitability of Coworking Spaces - 2017 Global Coworking Survey - Deskmag

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Can operators become rich with coworking spaces, or are their businesses just burning up money? It depends. The latter is clearly easier than the former. For most, the answer lies in the middle. According to self-reported figures, 40% of all coworking spaces are profitable today. The percentage has risen for four years running. Conversely, the percentage of coworking spaces that lost money saw a distinct drop, to 26% (in 2013: 36%). One factor is age. Coworking spaces still find themselves in a very new market. Nearly every third coworking space first opened within the last twelve months; four years ago, this figure was nearly half... Download the report here. And read more on deskmag.com

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Profitability of Coworking Spaces - 2017 Global Coworking Survey - Deskmag

  1. 1. THE 2017 GLOBAL COWORKING SURVEY THE INDEPENDENT RESEARCH IS SUPPORTED BYIN COLLABORATION WITH READ MORE AT BIT.LY/2017PROFIT PROFITABILITY OF COWORKING SPACES FINAL RESULTS OF THE 2017 GLOBAL COWORKING SURVEY IN CHARTS SELECTED SLIDES
  2. 2. SLIDES: - PERCENTAGES OF INCOME STREAMS OF A COWORKING SPACE - PERCENTAGES OF EXPENSES OF A COWORKING SPACE - AGES OF COWORKING SPACES WHEN THEY BROKE EVEN INCOME STREAMS & EXPENSES OF COWORKING SPACES THE 2017 GLOBAL COWORKING SURVEY PAGE 2
  3. 3. INCOME STREAMS OF COWORKING SPACES 2015-16 2016-17 2 %2 % 1 %1 % 2 %1 % 1 % 1 % 1 %2 % 2 %3 % 8 %8 % 10 %9 % 18 %17 % 18 % 16 % 36 %40 % RENTING DESKS COMBINED MEMBERSHIP PLANS RENTING PRIVATE OFFICES RENTING MEETING SPACES RENTING EVENT & CLASS SPACES VIRTUAL OFFICE SERVICES SPONSORING SALE OF FOOD & DRINKS SALE OF TICKETS TO INTERNAL EVENTS PUBLIC SUPPORT OTHER -4 +2 +1 +1 0 BASED ON ARITHMETIC MEAN THE 2017 GLOBAL COWORKING SURVEY A DECREASED PERCENTAGE DOES NOT INDICATE A DECREASE IN ABSOLUTE NUMBER; RATHER, IT INDICATES A DECREASE RELATIVE TO OTHER TYPES OF INCOME. 3
  4. 4. EXPENSES OF COWORKING SPACES* BASED ON ARITHMETIC MEAN 2015-16 2016-17 2 %2 % 5 %5 % 6 %6 % 5 % 4 % 5 %5 % 6 %7 % 16 % 13 % 15 % 15 % 40 %43 % RENT OF LOCATION OPERATING COSTS WAGES FOR STAFF MAINTENANCE WAGES FOR OWNERS EXTERNAL MARKETING EQUIPMENT FOOD & DRINKS OTHER* 0 -3 +3 83% 82% OF LOCATIONS ARE RENTED BY A COWORKING SPACE A DECREASED PERCENTAGE DOES NOT INDICATE A DECREASE IN ABSOLUTE NUMBER; RATHER, IT INDICATES A DECREASE RELATIVE TO OTHER TYPES OF EXPENSES. *LAST YEAR, MISSING VALUES WERE CLASSIFIED AS ‘OTHER’. THIS YEAR, MISSING VALUES WERE NOT CONSIDERED. FOR THE PURPOSE OF COMPARISON, MISSING VALUES WERE OMITTED FOR THE OVERVIEW OF EXPENSES FOR 2015–16 ALSO PRESENTED IN THIS CHART. THE 2017 GLOBAL COWORKING SURVEY4
  5. 5. FOR-PROFIT FOR-PROFIT NON-PROFIT ALL 10%17%11%9% 29% 27% 29%27% 26%23%25%27% 35%33%36%37% UP TO 6 MONTHS 7-12 MONTHS 13-24 MONTHS OLDER THAN 24 MONTHS AGES OF COWORKING SPACES WHEN THEY BROKE EVEN THE 2017 GLOBAL COWORKING SURVEY ARITHMETIC MEAN 5% TRIMMED MEAN 14.3 MONTHS 12.8 MONTHS 15.5 MONTHS 14.0 MONTHS12.4 MONTHS 13.9 MONTHS & PROFIT NEEDED 13.0 MONTHS 14.6 MONTHS THESE ARE THE RESULTS OF THE COWORKING SPACES THAT MADE ZERO PROFIT AND ZERO LOSS; OTHER COWORKING SPACES WERE NOT CONSIDERED DUE TO A MISSING FILTER. FILTER QUESTIONS WERE USED TO REDUCE THE NUMBER OF IRRELEVANT QUESTIONS. FOR EXAMPLE, A QUESTION REGARDING ‘BREAKING EVEN’ DOES NOT MAKE SENSE FOR UNPROFITABLE SPACES; THUS, SUCH QUESTIONS WERE FILTERED OUT. ALTHOUGH THE COMPLEX FILTER ALSO AFFECTED PROFITABLE SPACES, THE RESULTS ARE LIKELY TO BE SIMILAR TO WHEN PROFITABLE COWORKING SPACES BREAK EVEN. A COWORKING SPACE THAT BROKE EVEN NO LONGER RUNS AT A LOSS. 5
  6. 6. GENERAL COMPARISON OF PROFITABILITY OF ALL COWORKING SPACES SLIDES: - BY YEAR - BY YEAR - ESTIMATED PROFITABILITY OF COWORKING SPACES NEARBY - BY NUMBER OF MEMBERS - BY AGE OF COWORKING SPACE - BY TIME COMMITMENT OF FOUNDERS IN RUNNING A COWORKING SPACE - BY LEVEL OF EDUCATION OF FOUNDER - BY NO. OF INHABITANTS LOCAL TO THE COWORKING SPACE - BY GENDER OF OWNER OR FOUNDER - BY INCOME OF FOUNDERS BY GENDER & BY NO. OF MEMBERS THE 2017 GLOBAL COWORKING SURVEY PAGE 6
  7. 7. PAGE 7 PLEASE KEEP IN MIND... THE FOLLOWING CHARTS DEPICT THE PROFITABILITY OF COWORKING SPACES RELATIVE TO CERTAIN CHARACTERISTICS OF A COWORKING SPACE. MANY OF THE FOLLOWING CHARTS ILLUSTRATE THE STRENGTH OF A (LINEAR) CORRELATION BETWEEN A CHARACTERISTIC & PROFITABILITY; THERE ARE ALSO NONLINEAR CORRELATIONS THAT CAN BE DETECTED. HOWEVER, IT IS IMPORTANT TO UNDERSTAND THAT THE CHARACTERISTIC DID NOT NECESSARILY CAUSE THE DIFFERENCE! THERE IS USUALLY NO ONE CHARACTERISTIC THAT CAN AFFECT PROFITABILITY OVERALL (PERHAPS WITH THE EXCEPTION OF NUMBER OF MEMBERS); RATHER, A COMBINATION IS REQUIRED FOR SUCH AN EFFECT, AND NOT ALL CAN BE COLLECTED IN A QUANTITATIVE SURVEY. IN ADDITION, SOME CHARACTERISTICS ARE AFFECTED BY A BROADER BACKGROUND THAT IS NOT RELATED TO, BUT IS REFLECTED IN THE BUSINESS OF RUNNING A COWORKING SPACE. FOR EXAMPLE, THE INEQUALITY OF GENDER. A STATISTICAL SIGNIFICANCE ILLUSTRATES THE LIKELIHOOD OF A DIFFERENCE AMONG THE RESULTS OF GROUPS THAT IS NOT CAUSED BY COINCIDENCE. IT DOES NOT EXPLAIN MORE THAN THAT. ALL RESULTS ARE ROUNDED. HENCE, A SUM OF VALUES WITHIN A GROUP IS SOMETIMES LOWER OR HIGHER THAN 100%. THE 2017 GLOBAL COWORKING SURVEY
  8. 8. 2500 % 5000 % 7500 % 10000 % 2011-12 2012-13 2013-14 2015-16 2016-17 26%23% 33%36%38% 35%41% 34%32%23% 40%36%33%32%39% GENERAL DEVELOPMENT OF PROFITABILITY 2500 % 5000 % 7500 % 10000 % 2011-12 2012-13 2013-14 2015-16 2016-17 30,2%34,1%39,9%50,5%51,1% SHARE OF COWORKING SPACES THAT ARE ≤ 1 YEAR OLD THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 8 WITHOUTN.A.
  9. 9. 2500 % 5000 % 7500 % 10000 % 2011-12 2012-13 2013-14 2015-16 2016-17 23%30%24%29%26% 36% 35%42%37%44% 41%35%34%34%31% ESTIMATED PROFITABILITY OF COWORKING SPACES NEARBY 2500 % 5000 % 7500 % 10000 % 2011-12 2012-13 2013-14 2015-16 2016-17 24%22%31%35%37% 33%38%34%30%22% 43%40%36%35%42% GENERAL DEVELOPMENT OF FOR-PROFIT COWORKING SPACES THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 9 WITHOUTN.A.WITHOUTN.A.
  10. 10. BY NUMBER OF MEMBERS PER COWORKING SPACE 2500 % 5000 % 7500 % 10000 % ≤9 MEMBERS 10-24 25-49 50-99 100-199 200 & MORE MEMBERS 7% 12%17% 31%33% 57% 18% 25% 32% 44%45% 29% 75% 63% 51% 25%22%14% SHARE OF COWORKING SPACES BY NO. OF MEMBERS 750 % 1500 % 2250 % 3000 % UP TO 9 MEMBERS 10-24 25-49 50-99 100-199 200 & MORE MEMBERS 14%15%18%20%22% 12% RATHER STRONG LINEAR CORRELATION STRONG SIGNIFICANT DIFFERENCES THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 10 WITHOUTN.A.
  11. 11. 2500 % 5000 % 7500 % 10000 % UP TO 6 MONTHS 7-12 MONTHS 13-24 MONTHS 25-36 MONTHS 37-48 MONTHS OLDER THAN 48 14%20%13% 25% 44%49% 30% 30%42% 38% 29% 39% 56%50%45%37% 27% 13% BY AGE OF COWORKING SPACE SHARE OF COWORKING SPACES BY AGE 750 % 1500 % 2250 % 3000 % UP TO 6 MONTHS 7-12 MONTHS 13-24 MONTHS 25-36 MONTHS 37-48 MONTHS OLDER THAN 48 23% 11%16%21% 11% 19% MONTHS MONTHS MEDIUM LINEAR CORRELATION STRONG SIGNIFICANT DIFFERENCES THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 11 WITHOUTN.A.
  12. 12. 2500 % 5000 % 7500 % 10000 % FULL-TIME PART-TIME 30% 18% 38% 33% 33% 49% BY TIME COMMITMENT OF FOUNDERS* *IN RUNNING A COWORKING SPACE (INCL. OWNERS OR CO-FOUNDERS) SHARE OF COWORKING SPACES WITH THAT TIME COMMITMENT BY FOUNDERS 2500 % 5000 % 7500 % 10000 % FULL-TIME PART-TIME OTHER 3% 63% 34% WEAK LINEAR CORRELATION STRONG SIGNIFICANT DIFFERENCES THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 12 WITHOUTN.A.
  13. 13. 2500 % 5000 % 7500 % 10000 % COLLEGE BACHELOR MASTER 23% 33%28% 38% 32%40% 39%35%33% BY LEVEL OF EDUCATION OF OWNER OR FOUNDER SHARE OF COWORKING SPACES BY LEVEL OF EDUCATION OF OWNER OR FOUNDER 1250 % 2500 % 3750 % 5000 % COLLEGE BACHELOR MASTER 41%38% 12% VERY WEAK CORRELATION NO SIGNIFICANT DIFFERENCES THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 13 WITHOUTN.A.
  14. 14. 2500 % 5000 % 7500 % 10000 % 1 M & MORE 999,999 - 100 K 99,999 - 50K 49,999 - 20K LESS THAN 20 K 29%25%31% 23%27% 51% 42%33% 34%29% 20% 33%36%43%44% BY NO. OF INHABITANTS OF A LOCATION SHARE OF COWORKING SPACES BY NO. OF INHABITANTS 1250 % 2500 % 3750 % 5000 % 1 M & MORE 999,999 - 100 K 99,999 - 50K 49,999 - 20K LESS THAN 20 K 9%7%11%31%41% 1.2% N.A. SIGNIFICANT DIFFERENCES VERY WEAK LINEAR CORRELATION INHABITANTS THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 14 WITHOUTN.A.
  15. 15. 2500 % 5000 % 7500 % 10000 % FEMALE MALE 25%32% 36% 35% 40%34% BY GENDER OF OWNER OR FOUNDER - GLOBAL SHARE OF COWORKING SPACES BY GENDER OF OPERATOR OR FOUNDER 1250 % 2500 % 3750 % 5000 % FEMALE MALE 61%38% THE 2017 GLOBAL COWORKING SURVEYPROFITABLE ZERO LOSS, ZERO PROFIT UNPROFITABLE 15 WITHOUTN.A. WITHOUTN.A.
  16. 16. INCOME OF OWNER OR FOUNDER OF COWORKING SPACES MALE FOUNDERS 2500 % 5000 % 7500 % 10000 % UP TO 99 MEMBERS 100 & MORE MEMBERS 5% 20% 34% 51% 61% 30% THE 2017 GLOBAL COWORKING SURVEYABOVE AVERAGE AVERAGE BELOW AVERAGE 2500 % 5000 % 7500 % 10000 % UP TO 99 MEMBERS 100 & MORE MEMBERS 2% 23% 45% 47% 53% 30% FEMALE FOUNDERS BY NUMBER OF MEMBERS 2500 % 5000 % 7500 % 10000 % ALL MALE FOUNDERS 16% 47% 37% 2500 % 5000 % 7500 % 10000 % ALL FEMALE FOUNDERS 20% 47% 33% BY NUMBER OF MEMBERS 16 WITHOUTN.A.
  17. 17. THE 2017 GLOBAL COWORKING SURVEY "Social Workplaces are the physical nodes where the new generation of knowledgable connected workers find meaning in work, well-being and are amplified in terms of business operations and goals. SocialWorkplaces.com’s #1 mission is to connect these rising workplace communities. The company organizes the Coworking Europe conference: the first international conference of its kind, where approximately 500 coworking stakeholders from more than 40 countries gather each year. In 2015, the company launched the Coworking Africa conference and, more recently, introduced Coworking India, Coworking Middle East as well as the premium event “The Social Workplace Conference.” COLLABORATION PARTNER OF THE GLOBAL COWORKING SURVEY SocialWorkplaces.com THE 2017 GLOBAL COWORKING SURVEY "Social Workplaces are the physical nodes where the new generation of knowledgable connected workers find meaning in work, well-being and are amplified in terms of business operations and goals. SocialWorkplaces.com’s #1 mission is to connect these rising workplace communities. The company organizes the Coworking Europe conference: the first international conference of its kind, where approximately 500 coworking stakeholders from more than 40 countries gather each year. In 2015, the company launched the Coworking Africa conference and, more recently, introduced Coworking India, Coworking Middle East as well as the premium event “The Social Workplace Conference.” COLLABORATION PARTNER OF THE GLOBAL COWORKING SURVEY SocialWorkplaces.com 17
  18. 18. THE 2017 GLOBAL COWORKING SURVEY "Nexudus is a leading white-label platform to help coworking space operators with their day-to-day tasks. Today, hundreds of spaces around the world use Nexudus to spend less time typing and chasing invoices, keeping their communities engaged and up- to-date, or controlling who is in and out of the space and how it is used. Nexudus is made for and by their active community of users." nexudus.com essensys.tech communitas.network "Occupie, the essensys platform, is a simple, easy to use software platform that helps you manage your workspace from lead to cash and everything in between. Workspaces can attract and retain customers, grow additional income streams and gain business insight to make quicker decisions. We focus on ensuring that your workspace can deliver the best customer experience.” "Communitas believes in the power of community and the future of work. Through a marketing agency, benefits network, real estate advisory services and world-class publications, we help our clients better serve their stakeholders. Whether you are a builder of community or real estate, Communitas is here for you.” MAIN SUPPORTERS OF THE GLOBAL COWORKING SURVEY THE ‘MAIN SUPPORTERS’ PROVIDED FINANCIAL RESOURCES TO SUPPORT THE INDEPENDENT RESEARCH, AND WERE OFFICIAL PROMOTERS, OF THE 2017 GLOBAL COWORKING SURVEY. 18
  19. 19. THE 2017 GLOBAL COWORKING SURVEY OFFICIAL SUPPORTERS OF THE GLOBAL COWORKING SURVEY WESERLAND 19
  20. 20. THE 2017 GLOBAL COWORKING SURVEY BACKGROUND PARTICIPANTS: 2011-12: 913, 2012-13: 1206, 2013-14: 1270, 2015-16: 1679, 2016-17: 1876 THE FINAL RESULTS ARE ANALYZED USING A COMPLEX STATISTICAL TOOL, AND ARE CHECKING USING QUALITY STANDARDS. IT IS FOR THIS REASON THAT THE FIRST AND THE FINAL RESULTS MAY DIFFER SLIGHTLY. IN ADDITION, THE FINAL RESULTS ARE GROUPED BY DEMOGRAPHIC & OTHER CRITERIA USING A BI- OR MULTIVARIATE ANALYSIS. READ THE RELATED ARTICLE AT BIT.LY/2017PROFIT INTERESTED IN REGULAR UPDATES ON THE GLOBAL COWORKING SURVEY? JOIN OUR NEWSLETTER! ANY QUESTION? DROP A LINE TO SURVEY@DESKMAG.COM WOULD YOU LIKE TO SUPPORT THE GLOBAL COWORKING SURVEY AND RECEIVE MORE STATISTICS & CHARTS ON THE PROFITABILITY OF COWORKING SPACES? YES, GIMME MORE STATS! 20© DESKMAG - CARSTEN FOERTSCH - CARSTEN @ DESKMAG.COM

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