On Cafés: Coworking Space Activator or Time Suck

I recently relocated to Budapest, Hungary. I’ll be here for the next couple of months enjoying delicious Hungarian stews and beautiful pre-war architecture, not to mention the abundance of coworking spaces that have popped up over the last several years. I believe there are at least 10 now.

While I’ve mostly called Impact Hub Budapest my home I often frequent Mosaik, a coworking space in a district nearby my flat, in the evenings after work. The space is mostly focused on tech startups, with the typical tech-startup-y vibe that comes along with that: mostly men, mostly obsessed with work (seriously these guys are always working, it’s crazy), ping pong and foosball table, and tech-entrepreneurship-focused events. This vibe isn’t typically my jam as far as a work environment goes because I’m not in tech, but the people here are awesome and I love connecting with them.

One of the reasons I love coming here is that the space has a great café run by a fantastic and hard-working friend of mine. The café is open late and serves alcohol in addition to coffee and tea. The team is usually around late to hang out and chat (well, actually they are usually working and I’m probably distracting them).

My friend at Mosaik recently told me they are trying to make the café stand on its own two feet, while also attracting new members into the space. If they can’t make it work (e.g. make the café profitable), it will essentially be turned into a kitchenette for the members.

This prompted the question: are cafés in coworking spaces actually a space activator, attracting new members, partners, and opportunities to the space or are they merely a massive time and resource sinkhole? Let’s consider both sides.

To Café

The argument for the café is a sound one, in my opinion: Build a self-sustaining business that attracts your next most likely customer, the café-goer. Other than people working at other coworking spaces, people moving from another city where they used a coworking space, or remote workers, people who work at cafés are the most likely people to become members. Therefore it is absolutely reasonable to assume that if people frequent your café, they will ultimately get tired of the less comfortable furniture and pressure to buy more lattés than they should be allowed to drink. The coworking space is a

Think about it. Other than people working at other coworking spaces, people moving from another city where they used a coworking space, or remote workers, people who work at cafés are the most likely people to become members. Therefore it is absolutely reasonable to assume that if people frequent your café, they will ultimately get tired of the less comfortable furniture and pressure to buy more lattés than they should be allowed to drink. They will, in fact, be in a strong position to convert to a coworking membership. It’s a perfect segue for them.

What’s more, having a busy café in the front of your space makes it look more appealing to the outside world. Just like a seemingly busy restaurant looks more appetizing than an empty one. A busy café in the front of your coworking space makes the coworking space look more appealing.

Because the café is also a marketing tool to some extent, I think it’s reasonable to  absorb some of the cost of running the café into the coworking space’s budget, especially in the beginning.

To Not Café

Obviously, the biggest reason to not café is that a café is a different business with a different business model and requires it’s own administration and resources. A café in a coworking space requires all the things a regular café requires: a suitable space within a reasonable walking distance of your customers or with a drive-thru/parking lot, quality goods to sell, and great service. Note that reasonable walking distance means reasonable to the people doing the walking, not just to the imaginary people in your head.

Foot traffic isn’t necessarily important if you are in a high-density area. So long as you are in a place where people will divert their morning “by foot” commute to an extent to get a good cup of coffee or where people may stop after work to have a quick drink on the way home.

What you don’t want is to be in a “foot traffic desert,” a place with less than or equal to 40 single-family homes within a 2-3 block walking radius. That’s bad. In these suburban neighborhoods, nobody really walks. In this neighborhood, you probably shouldn’t even have a coworking space (unless you have a parking lot).

So no, don’t do a café if you aren’t willing to give it the good, solid shot that a “real” café ought to get (that is to say at least six months of effort to make it work). And don’t do it if you’re in a location where a café probably wouldn’t work anyway.

 

One great example I can think of when it comes to cafés in coworking spaces is CO+HOOTS in Phoenix, AZ, USA. I believe it was CO+HOOTS’s second location that featured a great café in the front part of the space. Unless you were a full-time member you needed to enter the coworking space from the café entrance. The café was always filled with people enjoying coffee and delicious homemade snacks. In the short amount of time I was there, I overheard people in the café asking what the back area was. Of course, the barista told them it was CO+HOOTS, a really rad coworking space. He encouraged them to go check it out.

Overall, I think a café is a great addition to any retail-level coworking space. It can attract a lot of new members and create a casual, social vibe that many coworking spaces lack. But you have to do it right. CO+HOOTS did the café the right way. Make sure you do the same.

Ryan Chatterton
ryan@coworkinginsights.com

Ryan is the founder of Coworking Insights, a coworking media platform focused on delivering unique and in-depth insights for coworking founders and their teams. He’s the Marketing Director at Habu, a quickly growing coworking management platform that is simple, fast, and intuitive for managing recurring billing, bookings, and other admin tasks. Formerly with Impact Hub and PARISOMA, Ryan now has over 4 years of combined experience in a variety of roles in the coworking industry, including marketing, events, operations, sales, software, and partnerships He’s a digital nomad and a lover of wine and tacos..