We believe that the future is coworking – coworking is to virtual office, what the Web 2.0 is to the traditional web. It is a way for business owners to engage and interact with other business owners in a way that spurs collaboration and innovation.
To understand this better we did a little work with Google Trends.
This shows quite neatly that a trend reversal for Virtual Office is now in full swing. Coworking is a trend that started almost 9 years ago and is slowly gaining momentum. Virtual Offices as a trend peaked near 2005 and 2004 (coincidentally, that was the same time that DaVinci Virtual came to be).
When we look at the country data, however, we see some other interesting information. Canada is not anywhere near the top – which can mean 1 of 3 things. a) Canadians don’t care for Virtual Offices or Coworking spaces they way other countries care, b) Canadians don’t know about it, c) Canadian commercial real estate prices are much more affordable, thereby making Virtual Offices unattractive.
Depending on which is true, the future of the market will change.
Taking a closer look at the Canadian market we notice the following:
1) There has been a sudden down turn in interest for Virtual Offices since 2011
2) The uptake of coworking as an alternative has not yet emerged fully
Montreal and Toronto are the only places with real traction for coworking, while Mississauga, a Toronto suburb, shows the highest interest in virtual offices, followed by Vancouver and Toronto. Virtual Offices are essentially present and desires across the country, while coworking seems to be more a cosmopolitan trend in Canada.
Additionally, the concept of a “Shared Office” seems to have more traction in Canada than coworking. While these two terms almost mean the same thing in practice, it seems refreshingly Canadian that we prefer the former to the latter. Coworking suggests a trend with associated hype, while shared office is more of a bland description of the reality of things – i.e. you share an office with others; you may or may not be co-operating in your work with them.
What does that mean for office space? Here we have to consider other factors. Coworking as a trend emerged when the financial crisis hit. Psychologically, it suggests that it was born from a need to have support while being forced to going it alone. People with families and mortgages lost their jobs, and were even forced out of their homes. While banks were being bailed out, small businesses experienced a downtrend due to a huge drop in consumer spending. As the economy slowly recovered, the lack of consumer spending encouraged part-time, contract, and low-paid work, over full-time work.
It is interesting to see how coworking as a global trend is biggest in Spain, a country that is economically stable (it was never on the brink of collapse like Greece or Ireland) but it was hit harder than other EU countries. Coming out of the financial crisis Spain had an unemployment rate of 25%. This means that people with very little savings and very little business experience where forced to start their own business in hopes of making ends meet. Canada never experienced a recession and walked through the global crisis with just reduced growth. This has something to do with Jim Flaherty, but also with the polices that the liberal government put in place a decade earlier, and with Mark Carney, the then Governor of the Bank of Canada. But, having not experienced a recession, nor a sudden rise in unemployment, coworking has remained less trendy and uninteresting in Canada compare to the rest of the world; while the less trendy term “Shared Office”, which means the same thing, has gained significant traction and momentum. company structures