The New Corporate Obsession With Coworking

Corporate companies are moving into coworking spaces that have served as startup incubators. These spaces are organized so that Fortune 500 companies can connect with innovators, innovations, talent and a reduced cost of real estate.

Freelancers and startups are finding themselves joined by established companies in these coworking spaces lately. In fact, talented app developers, software engineers and data scientists are beginning to see this as an opportunity to be discovered and hired by a company that can provide them with a new opportunity.

The sudden interest in coworking spaces on the part of big businesses may be an effort to rediscover a culture of innovation. By offering space and an environment rich with resources, these coworking spaces manage to keep catering to their initial targets: startups and freelancers.

Meanwhile, corporations get to stay in that hungry, innovative environment while keeping their thumb on the pulse of new developments. They can also find new talent when they join coworking spaces. Here are several partnerships that developed over the past few years.

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Nearly half (44%) of corporations are already using some type of flexible open platform office solution

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Barclays, the multinational banking institution, rolled out a fintech-focused accelerator space in the Flatiron Disrict, NYC called Rise. Rise offers three floors of membership coworking space, an auditorium of 100 seats, meetings rooms, and facilities for recording videos and podcasts allowing startups to stay flexible, try new things, and grow.

IBM teamed up with Galvanize at their New York office in West Soho. The computer giant announced a new program that uses Galvanize’s learning environment called the IBM Cognitive Curriculum to encourage innovation. This course uses AI cognitive skills and data science to educate the next generation of machine learning developers and scientists in tech’s most lucrative careers. Later on April 19th, 2017, IBM announced it had managed to secure an entire WeWork building to give 600 employees a place to work.

Towards the end of 2016, headlines popped up that Microsoft was giving 30% of its employees (the ones in their sales departments) access to WeWork spaces. Microsoft representatives said this was because they wanted to tap into the creativity of a startup culture with a flexible coworking office arrangement.

Though WeWork, valued at $20 billion, is the biggest coworking player in NYC, Alley, a comparable company, is making moves as well with a partnership with Verizon that was announced in June, 2017. This partnership with the world’s leading telecoms company let Alley introduce new locations in New York, Cambridge, and Washington, D.C. The project, called “Alley powered by Verizon, is intended to give Verizon executives access to a new kind of networking in addition to revenue sharing.

“To us, the real value is what we get by bringing entrepreneurs into the building and having them meet our folks,” said John Vazquez, senior vice president and head of global real estate at Verizon in TNW. “We realize that things will be invented outside of Verizon and we want to be a part of that.”

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By 2020, 60% of companies believe they will use coworking as part of their office portfolio

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An occupancy survey in Q3 by commercial brokerage firm CBRE suggested that nearly half (44%) of corporations are already using some type of flexible office solution. The survey data tracked and covered leaders in departments of corporate real estate for major companies, and discovered that their demand for flexible office space is predicted to continue in years to come.

In fact, by 2020, 60% of companies believe they will use coworking as part of their office portfolio in the Americas. Global real estate services company, JLL, projects that 30% of office space will have a flexible design or mimic open layout by 2030. The report based this prediction on incentives like innovation, collaboration, and affordability.

The factors that drive these and other major pushes towards coworking and coworking-style spaces by established companies tend to be the explosion of independent contractors, freelancers, developers and so on. Beyond the access to talent, corporations can connect with the breeding grounds for disruptive tech in an effort to be better prepared for future competition or acquisitions.