I’m writing this from a nice café in Ho Chi Minh City – curiously named Bosgaurus, which sounds like the Bosporus’ answer to the Loch Ness Monster. I could be doing this from a coworking space, but it’s Saturday, the coffee is good, the WiFi is good enough and it’s a very reasonable location.
Glancing right and seeing a choppy-looking Saigon river, the scene of so much history in the 20th century, I’m thinking: why doesn’t the coffee shop option appeal more to solo workers?
Coworking spaces are all the rage, from Bangkok to Bali. But before you start the next digital nomad hotspot, how do you measure their success? Rae Steinbach provides an answer in this guest post.
Coworking spaces are increasing in popularity. Once the domain of small startups and entrepreneurs, major companies like Verizon and IBM are now experimenting with this office layout.
Measuring the performance of these spaces requires an approach that matches their uniqueness. You can’t rely on the same KPIs that you would when measuring the performance of a typical office. Similarly, using traditional enterprise performance management systems will be relatively ineffective in a coworking space. You need to modify your approach to fit this new setting.
To leverage a coworking space to its full potential, apply the following KPIs. They’ll provide you with a clearer understanding of how a space is performing, and what you can do to address potential weaknesses.
Focus on Workstations
In coworking spaces, you don’t want to focus simply on the cost per person. Instead, you should measure the performance of dedicated workstations. Keep track of their usage throughout the day. Specifically, focus on the following KPIs:
Daily Peak Utilisation – The highest number of people using a dedicated workstation at the same time on an average day.
Daily Peak Utilisation by Business Unit – The maximum number of people from specific business units using a space each day. This makes it easier to determine which companies take advantage of a space in the most efficient way possible.
Frequency of Peaks – How often over the course of a month the workstation reaches its monthly peak. By identifying trends, you can better predict how, when, and why certain individuals and groups use a space.
Track Collaborative Uses
There are several different types of spaces within a coworking office. Some merely consist of individual desks. Others include conference rooms and dedicated workstations. These areas allow larger groups to work together on projects.
Understanding how often people and business units take advantage of these collaborative spaces will help you better understand their value. If the collaborative areas appear to be in high demand, you may want to improve the office by making more available. On the other hand, if they’re not being used often, some might be more effective as areas for individuals to work.
These KPIs are relatively easy to track. Every month, review how many times conference rooms were booked. You should also keep track of collaborative workspace usage. If your coworking space offers communication tools, like video-conferencing rooms, find out how often they’re employed as well.
This information will let you know whether your coworking space is more attractive to individuals and small groups or larger teams.
Monitor Tenant Churn
According to a recent survey, 75% of teams using coworking spaces indicate they are likely to continue using the same space for at least another year. That’s an encouraging statistic. Reducing tenant churn should be a key goal of anyone operating a coworking space; the less time spent trying to attract new tenants, the better.
That said, while the 75% average may be impressive, there’s always room for improvement. Tracking the right KPIs will help you identify what steps you can take to further reduce tenant churn. The following are key metrics worth paying attention to:
Number of new members per month
Member Retention Rate – Percentage of members who renew each month
Conversions and Average Member Lifespan per Marketing Channel – Which marketing channel is most effective at getting a tenant to sign up for a space? Which marketing channel boasts the highest average member lifespan?
Cost of Acquisition per Marketing Channel – How much it costs to acquire a new tenant per each marketing medium
These KPIs give you a clear view of how successful your marketing efforts are at attracting new tenants. You can use insights gleaned from them to devote your resources to the most effective channels.
Pay attention if your member retention rate drops below 75%. If you’re falling below the average, it means you need to take steps to ensure the coworking space better serves your customers. Along with measuring KPIs, you could simply distribute regular surveys to your customers. Ask them what you can do to improve the space. Their feedback will make it easier to plan an effective strategy and make adjustments to the environment.
Recent statistics indicate that the percentage of coworking spaces that make a profit is steadily increasing, while the percentage of coworking spaces that lose money is dropping noticeably. As more and more organizations embrace the collaborative benefits these spaces offer, they’re likely to become even more profitable.
That’s why it’s necessary to track certain KPIs regularly. You need to know how your space is being used in order to maximize your revenue. That said, with major companies giving coworking spaces a try, it’s also important to anticipate how future tenants will use them.
The needs of your current tenants may shift as you attract larger businesses. Monitor KPIs vigilantly, and you’ll be prepared to make the necessary changes to accommodate new clients when they arrive.
Rae Steinbach is a graduate of Tufts University with a combined International Relations and Chinese degree. After spending time living and working abroad in China, she returned to NYC to pursue her career and continue curating quality content. Rae is passionate about travel, food, and writing, of course.
City and country slogans are often cringingly bad. Incredible this, amazing that. The “Pearl of the Orient” is one of the few exceptions that ring true.
Malaysia’s small but satisfyingly formed Penang Island shines like a gem, from its photogenic heritage town (now spruced up) to its jungle-clad hills. It’s impossible not to feel seduced by it.
Penang was my first Asian destination, way back in pre-smartphone 2002 when a camera roll of 36 exposures was a luxury, and I was entranced by its exotic smells, wildlife, cultural celebrations, heritage, and prawn mee with belacan. It looked like a sprawling film-set, and the “Asia” I’d imagined.
On my second visit, in 2009, a beautiful young Malaysian couple ahead of me in a street food queue started a conversation that ended with an invitation to their wedding the following month. I returned weeks later; a random, wide-eyed foreigner attending a traditional Chinese wedding. Oddly enough, I had to wear a pair of disposable underwear over my trousers – but that’s a story for another time, as they say.
That’s the kind of place Penang is – blessed by the (many) gods – and in the years since, I have been drawn back again and again.
In more recent years, Penang has undergone a renaissance of sorts. First, Unesco World Heritage status put it firmly on the international map, resulting in a flurry of boutique hotel and hipster coffee shop openings, giant murals painted on buildings, and steel rod caricatures (some with a tacky feel) labelling key streets. The town bubbles with cultural events like the annual George Town Festival.
Second, with its past a major asset that pulls in the tourists (some might say too many), George Town is now looking to its future. There is a crackle in the air, and possibly even a cheeky wink at its bigger and more conservative cousin Kuala Lumpur.
George Town is fizzing with startup energy. Mostly famous for brilliant startup Piktochart (the go to website for infographics), new projects are popping up like mushrooms after a tropical downpour.
The town’s startup culture has been aided by the recent opening of a grand coworking space near the waterfront, @CAT.
Set within a hundred-year colonial heritage building that had laid abandoned for 40 years, Wisma Yeap Chor Ee, @CAT is an ideal location for creative inspiration (film buffs might also recognise it as a filming location for Ang Lee’s Lust, Caution). Of course I had to check it out on my first visit to Penang in more than a year.
I was kindly shown around @CAT by Community & Operations COO & Partnerships Director Zoey Teoh, who explained that the co-working space was supported by the Penang State Government (hence the amazing location) and that its ultimate purpose was to appeal to foreign investors.
Penang was ideally suited to tech startups, Zoey added, saying that both it and Silicon Valley shared an electronics industry heritage. (They’re also on the west coast and have long-ish bridges, and that’s probably where the similarities end.) There’s also a bit of Silicon Valley at @CAT, with people from Google and what not coming over for events.
The @CAT community is made up mostly of freelance coders and digital marketers, several of whom are digital nomads who come and go (Zoey said that they were always pleased to see familiar faces return). But there were corporate faces too – two big companies (unnamed) had sent staff over to scope out the Penang scene.
Alongside a board naming startups there was a wish list. Top of the list was coffee (and why not – it tops my to do list every day), which was somewhat of a surprise as there was a huge cafe downstairs.
The Penang Science Cafe was impressive enough in its own right, replete with interesting books that didn’t include the usual tatty airport novels left behind by backpackers. There was even a 3D printed model of Penang Bridge to gaze at.
But here’s the really fun part: in an adjoining room there were things to tinker with that included a Raspberry Pi and – how else to write this – an aircraft. So in theory, you could wander over with a flat white and stare at a Cessna.
If that wasn’t exciting enough, you could probably build your own Sky Hawk II minutes later. Across an outside courtyard with potted plants there was a Makerspace and Garage with enough gizmos to make Q from the 007 movies blush. It was an electronics, woodworking and metalworking playground where you could probably just about make anything, apart from Mars exploration rovers.
I could have lingered for hours at the Wisma Yeap Chor Ee building. For young creative Penangites, it’s the stuff of fantasy. For digital nomads and entrepreneurs, it’s an affordable place to work and mingle.
Conveniently, it’s also a few Andaman island hops from Thailand’s Koh Lanta, the scene of coworking community KoHub, which would make a fun trip – something to think about if you’re stuck in a beige office on a grey November day.