The diversification of video gaming has been fascinating to watch. What started out with the two paddles of pong has diversified into a creative industry with innumerable permutations, from racing games to fighting games to cooking games, and an esports industry expected to be worth over $1.6 billion in 2021. But while the types of games available for play have grown, so too have the ways in which games can be purchased and played. As a subscription, a one-time purchase, a free base with paid upgrades; there’s something that fits for every lifestyle.
In a similar way, co-working is diversifying not only geographically and in the number of industries served (food service, biotech) but also in terms of how co-working space is delivered in the first place. As a handful of big-name companies vie for market dominance, a universe of local operators offer their spaces as well.
Of course, there isn’t room for everyone in the long term. Plenty of companies will either be acquired by their more successful competitors or simply fold. For those who survive for more than the next couple years, we may see divisions begin to appear along lines of strategy.
Some companies may continue to pursue the current target: a mix of large corporations and smaller, more entrepreneurial tenants. But other operators may decide to specialize, partnering with a number of big space users and maximizing economies of scale, or by paring down their offerings and sticking with the little guys. Entrepreneurs and companies (even those that fancy themselves startup-minded) need different things; there could be some validity to keeping the uses more separate. Choosing to focus on one group or the other could allow operators to start to offer more of the in-depth services and amenities that those particular groups need.
Other companies may decide their ticket to success is stamped by scoping down into a smaller niche, like nonprofits, creatives, or FinTech. For these spaces, the line between co-working and incubator may start to blend, something that is probably an area worthy of exploration in future articles. But for these operators and their tenants, it could be a good thing.
The point is, co-working is far from monolithic, even within the same city or on the same block. As the front of the pack begins to sift out, understanding how these companies operate will be important for their own landlords as well as the companies that envision integrating co-working into their space plans.