Idea Engineering Agency has written about the need to start with a strong idea in order to increase the odds of creating a successful business, however it is not just about valuating the idea, you also need to evaluate the ecosystem of the idea. In other words, will your idea be functional in your desired market place?

For instance, lets look at coworking. Even though we may all agree that coworking is a solidly strong idea, some spaces shut down after a lack of success. Why? When is a city ready for a coworking space and how do you make it work?

Choose The Right Place

Not every city might be ready for a coworking space, and not every area in a city is the right place. One, make sure that there is diversity in the area- this will give the coworking space an interesting backdrop and draw people in.  Two, the area should be up and coming, not over developed. Over developed areas tend to have a negative psychology towards new types of businesses, plus more than likely entrepreneurs will not be able to afford it. It is far easier to create a magnet, which draws people to an area than it is to compete and shout in a saturated market place.

Three, be a keen observer of your desired area- can you create partnerships? Are there great transport links? Who are the locals? What is the economy of the area? Who and why will people be drawn to the area? What is the sociology of the area? Is the area known for trends, shopping, young people, etc? Who has access to the area and would they find coworking useful? Is it a desired area or will you have to create desire? Ask what others think about the area?

Four, is the area in a correct price range? For instance you may choose Soho, NYC- sounds great, but are the overheads worth the space being in such an expensive part of town? Will the entrepreneurs value the price? In contrast if you go for a cheap location to avoid high rents; will people consider it too underdeveloped or out of the way? If so, they may not value the low rent option.

Not One Size Fits All
Create an infrastructure that is right for your community instead of just adopting generic options. What may work in one space/city may not work in another. Again it is important to ask questions, such as, what do my local entrepreneurs find valuable? How do they define value? Why would they come to a coworking space instead of a coffee shop, their back room, or a generic office?

Think about other revenue streams, so economy is not dependent on membership alone.

Keep Overheads Low

This is crucial. Negotiate on your mortgage or lease, and keep fittings to a minimal as coworking is not intended to have the same high-brow atmosphere as a member’s club. Create honorary memberships for people who can help run the space to keep staffing minimal,   and purchase from local suppliers who can offer a better price.

Build A Community First

People attract people, so if you can avoid starting with an empty space, do. Host events to generate interest, build community, and collect data about the needs of entrepreneurs in your area. Through this process, you might find an interesting pivot that you had not thought of and build a more solid business.

Create Value

In all honesty, if people want cheap they can stay in their homes, but if the space offers something that entrepreneurs cannot get anywhere else, you have created value. This can be done through a clear focus, yet again, ask more questions- who will benefit from the space and why? What services can you offer to make the transition into enterprise easier? If you do that well, most entrepreneurs will value that above any price.