From an economic perspective, Madison lacks a smooth and appropriately priced upgrade path for a technology entrepreneur who is not yet starting a funded venture or whose funding has uncertain duration. As a result, there is not an obvious, prudent route from the coffee shop as a workplace to one suitable for a new technology venture. Routes that do exist often involve working somewhere they or their customers may find substandard.
The high quality office or incubator locations are often too large a step in cost or duration of commitment for entrepreneurs to be able to fill this gap through discounting or escalation clauses. They also simply exceed the needs of the growing population of independent or loosely associated freelancers; these professionals want great places to work and meet with clients, but do not have staff and do not want offices of their own to manage. We suggest this disconnect contributes to lower utilization, discounting, and price erosion in entry level office spaces, and makes it difficult for incubators to attract and maintain turnover of a heterogeneous mix of smaller startups.
Madison coworking advocates propose facilities that play both a bridging and capacitive roll, filling in a high demand for a middle option utilizing and ultimately paying market rates for existing vacancies in office and incubator options to do it. Our community dissolves at one end into an equilibrium with the large pool of local could be coworkers found at the coffee shop or the local colleges’ libraries, and at the other end into quality startup ventures - tenants and clients for Madison’s traditional office spaces and service businesses.
Coworking does this by creating that prudent path for both the professional nomad or enterprising grad/student to go from working in labs and cafes towards functioning as a more engaged professional. Folks can get involved at a level that makes sense to them, without undue risk or cost, through tiered products that are appropriate to their level of need and risk aversion. Clear relationships to the incubator options for those startup businesses that attract capital will keep turn over healthy. Small reservable spaces for small service companies or ad-hoc teams allow folks within the coworking environment to attract and execute projects and build those startups. Coworking can act to unite scales of professional activity further out in the long tail which will help the freelance and entrepreneurial community thrive and drive growth.
