What does coworking colossus WeWork’s expansion mean for the North?

Accelerator, Manchester, Newcastle

Martin BryantMartin Bryant, July 4, 2017

This article was originally posted on the Tech North website.

One measure of how far the North of England’s tech sector has advanced is that international names from the worlds of investment and ecosystem support have begun to spread their UK presences up from London. Last week saw Wayra announce its first Northern accelerator. The other big recent announcement was the biggest name in coworking, New York-based WeWork, is expanding to Manchester early next year.

It’s fair to assume that WeWork’s UK managing director, Joe Gaunt, must have his hands full in London. The company recently announced its twentieth space in the capital city. And yet as a Leeds-born lad who still boasts an unmistakeable West Yorkshire accent, he’s excited to expand up north.

If you’re unfamiliar with WeWork, you may be surprised by the size of its facilities. The Manchester space will span three floors in the Spinningfields area of the city centre. There will be space to accommodate everyone from individuals up to enterprise teams – and that’s on the smaller end for the company’s spaces.

Manchester isn’t short of coworking and startup-focused office spaces these days. It seems like somewhere new opens every week, but Gaunt is confident there’s a space for WeWork in the mix. “It’s a busy market but that proves our concept,” he says.

Part of the network

A key part of WeWork’s offer is its international community. It has a member network that lets you connect with other users around the world. And if you have trip planned to another city with a WeWork presence, you’ll be able to book a meeting room there as part of your Manchester membership.

WeWork lets its users manage bookings and networking via a dedicated app. Gaunt says 70 percent of members interact on the app, and 50 percent of members use it to do business.

WeWork Creator Awards

WeWork’s Creator Awards will give money to innovative businesses and ideas.

Its scale and warchest (it’s raised $3.69 billion to date) means WeWork can do things smaller brands can’t. For example, its upcoming Creator Awards will give away a total of $1.5 million in the UK to “those who are thinking in new ways, building fresh projects, and achieving real change around the globe.” These are grants, not an equity-based investments, and you can apply now if you’re interested.

What does WeWork mean for Northern coworking?

Gaunt says WeWork’s ambition is to open up in every major UK city. So, it’s fair to assume that it’ll announce presences elsewhere in the North eventually. Coworking is a key part of many tech ecosystems, but it’s unevenly distributed across the region.

In Manchester, WeWork’s arrival is likely to encourage operators of competing spaces to differentiate their offerings more distinctly. We’ve seen some of that already with Platform Four’s focus on social enterprise collaboration, and the upcoming Vault fintech space in the XYZ building. There’s also a danger the city could become oversaturated with coworking and startup-focused office spaces. There’s no sign of that quite yet, though.

Newcastle is preparing for an explosion of startup-friendly workspaces over the next couple of years. But elsewhere, in markets with few players, there’s a chance WeWork – with its slick marketing and big budgets – could be a threat to what incumbents there are. That said, the evolution of working habits to emphasise flexibility and collaboration should mean that competition is healthy in the longer term. And anyway, the presence of a high-profile coworking brand in a city could encourage more people to start businesses there. That would be a positive for the whole sector.

Still, WeWork shouldn’t underestimate the North’s ability to put friendly local community over big, glossy brands! This won’t be news to Gaunt; he stays in touch with his Yorkshire roots as a mentor to students at Leeds University’s Business School.

Either way, WeWork’s arrival in Manchester is a good sign that there’s a growing appetite for entrepreneur-focused workspaces in the North. And the world is starting to pay attention.