Thriving In Smaller Markets
How often have you heard a coworking owner say, ‘I started my space because it didn’t exist in my neighborhood? I love the concept, I love the community, so why not?’
This common story means that coworking spaces are often a side business to a lot of entrepreneurs. They own a small business already, needed office space, and figured it would be fun and easy to just sign a larger lease and invite others in. You’ve heard this before?
The problem with side businesses is that they can quickly go from fun hobbies to physically and emotionally exhausting ventures in just a few months. Being a tired owner of a coworking space is a common experience because of both success and struggles.
If the space is filling up with members, then it now requires unavailable full-time attention. If the space is struggling, then it might need someone with different skills, more money, and more time. Either way, if the coworking space is causing stress, it might be time to hand it over to someone ready to take it to the next level and for you to cash out.
Selling your coworking space can be a difficult decision and a very personal one. Nicole Vasquez, founder of The Shift, sold her second location in Chicago within a few years of opening her space and described the feeling of being free to pursue her other businesses.
There were a few reasons but the biggest was that I had another company that needed more of my time and focus and after running the space solo for 2 years straight then running it part-time for another 1.5 years, I was mentally ready to exit. ‘
In the past, many coworking spaces have simply not renewed the lease for the space and closed down. The saddest part is that the community is forced to separate or go back to working from home. The owner doesn’t get rewarded for their hard work, and the place just ceases to exist. Closing a place down is the simplest option, but has the least upside.
Once you decide that you want to sell your space, you’ll want to decide who would be the right person to sell to, what is best for your community, and how to get your books in order. If you want to see how much your coworking space is valued then check out this helpful tool.
DenSwap is a free tool that specializes in connecting people who are buying and selling coworking spaces. To gauge the interest in a particular space, talk to a local business broker, or be open and start telling your members to see if they would be interested in taking over your space.
The key to finding a fair valuation is to do it calmly and methodically, taking note of every potential asset or liability the space has to offer. As the industry continues to grow and evolve, many coworking owners are discovering how to maneuver their business in a market where there is no real precedent or general practice for buying and selling. DenSwap is one of the few tools available to these owners and stakeholders who need some sort of starting point in negotiating the sale of a space.
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