Coworking Space: How Does It Work & Make Money?

In this ever-changing world of workplace set ups, you might have heard of or witnessed your entrepreneur friends choosing CoWorking Spaces as their office.

There must be many questions in your mind like “What is a co-working space?”, “How does a Coworking Space Operate and make money”?, “Why should I care about it?”

Well, on the contrary to popular beliefs, coworking space is a startup in itself which has disrupted the current workplace scenario. The way it operates and makes money is also a lot different from the usual. Read on to know more.

What Is Coworking Space?

Coworking space is a business service provision model which lets individuals and teams work independently or collaboratively in a shared office space. Even though it’s a shared office space, a coworking space provides an environment that simulates the environment found in an established venture.

Besides being a shared office space, coworking spaces also serve as a place to hold relevant workshops, conferences, and much more.

coworking space
source: 91springboard

How Coworking Space Makes Money?

Unlike other office spaces, the co-working space business model is a bit different. A coworking space is a startup in itself which has disrupted the existing market scenario. It not only makes money in the form of rents but also has widened its branches to other revenue sources like partnerships and memberships.


coworking spaces
source: 91springboard

1. Renting Out The Office Infrastructure

Just like a normal workplace, a coworking space has set number of workstations which it rents to individual and teams. This renting out the workstations acts as the primary source of revenue for most coworking spaces.

Besides the dedicated workstations, many coworking spaces offer dedicated cabins for rents too. Many of them also offer a flexible rent option where they provide an à la carte solutions to the users.

2. Renting Out Space

Many coworking spaces with available halls and meeting rooms also rent out these spaces for events like conferences, seminars, training workshops etc.

They charge a fee that is nominal when compared to other resource-intensive alternatives and also provide adequate facilities to host such events.

Virtual Offices

Some coworking spaces even add virtual offices offering to their business model. A virtual office is a premium work address which the business uses for listings and mails and packages, while the team works from home.

A virtual office is a boon for entrepreneurs who like to work from home but need a dedicated premium looking address for their startup.


Since there is a lot of diversity in terms of types of companies, work structure, and employees in coworking spaces, some B2B companies usually use these spaces for promotional activities.

Even workshops or training that are conducted in coworking space serve as a means of promoting a product and become a source of revenue.

Premium Membership

Every product venture at some point of time does introduce features and facilities that could be availed by paying some amount. Premium membership is a one time fee usually charged annually and gives access to marquee facilities. This form of revenue generation also ensures loyalty.


Since there are a plethora of tasks that are being done under one roof, it becomes easier for both the investors and members to reach one another.

Strategic tie-ups with angel investors or venture capitalists lead to an increase in revenue and also popularity among the masses. Coworking spaces act as an easy medium to connect investors to the startup founders and charge a small commission or fee for the same.

Why Have Coworking Spaces Become So Popular?

Coworking spaces provide a cheap alternative for budding enterprises. You could book a room for a team of even two people or an entire floor for a medium scale enterprise and still pay nominal fees.

Even after being a cheaper alternative, coworking space still has the best resources for the community.

Benefits Of Coworking Spaces

Zero Capital Investment

The biggest benefit of coworking spaces is that entrepreneurs don’t have to shed their pockets or look for investors to invest in offices before the actual product is released or the actual business is set up.


Working from home has an abundance of distractions like TV, pets, bed, and family, and such constant distractions reduce productivity.

Maintaining a clear distinction between work and home allows an individual to keep the structure in their life, and provides all the more reason to get out of the comforts of their home and work in an office like environment.


Since coworking space brings people from diverse background, it provides you with an opportunity to work with people vastly different skillsets and gain a new perspective about solutions to a problem and if you are in a coworking space that has more professionals aligned with interest you could actually come with a novel solution.


As a budding entrepreneur, it is impossible to set up a fully functional office as you might be investing even the seed funding in hiring the best talent to help your venture grow.

Apart from this owning an office space is no easy task in itself.

Lease agreements, utility bills and the infrastructure for ensuring smooth functioning require a significant amount of money as well as time.

On the other hand coworking spaces already have these arrangements in place.

Emotional Stability

There will be times when you as an entrepreneur would feel like nothing is working and would tend to give up. When in self-doubt, the best way to overcome it is the being in the company of people. Their stories and struggles might motivate you and reduce the negative vibes in your life.

Also working alone in your home would make you feel lonely and you would want someone to address your concerns be it technical or spiritual.

Working in a coworking space brings you an opportunity to connect with people and learn from them.

The Best Coworking Spaces In The World

While defining the best coworking space, it is essential to have some basic criteria for judgements.

The best coworking space could be judged on three parameters – Location, Innovativeness and Community.

Location: It is crucial for a location to be situated in a metropolis. This is because a metropolis has better access to facilities and it is easy to find fast solutions if a problem may occur.

Innovativeness: It is essential for the coworking space to have some innovation. It should not be just four walls with basic amenities. It should provide some facilities that stand out.

Community: Coworking space is all about community. There is no point of a coworking space if it doesn’t have the right people working there. A large part is about the spirit of the people you work with.

Let’s look at some of the best coworking space around the globe.

1. TNW’s TQ, Amsterdam, Holland

Located in Amsterdam TQ has created a niche for itself. Providing members with access to world-class seminars, conferences, community and events; it is a dream come true for many entrepreneurs.

2. Village Underground Lisboa, Lisbon, Portugal

Apart from the community and facilities, it has to offer, the best part about it is the structure. Its unique architectural structure is made from shipping containers and double-decker buses, recycled into office spaces, a restaurant and conference room.

Apart from this Village Underground has established itself as a global powerhouse when it comes to CoWorking Spaces establishing a branch in London as well.

3. The Pool, Mexico

It’s the atmosphere of departure that makes “The Pool” so special. You can experience creativity and productivity in every corner of the building.

Go On, Tell Us What You Think!

Did we miss something?  Come on! Tell us what you think of this article on coworking spaces in the comments section.