The work landscape is changing – careers are no longer linear, traditional career paths have collapsed, new career paths have emerged, contingent work is on the rise, and so is the formation of startups. In addition to these trends, more and more people are choosing the camaraderie and strategic partnership opportunities that come from sharing a coworking space with others, as opposed to the more expensive and often lonelier option of a traditional office. But now that coworking is on the rise, so is competition amongst spaces.
In Australia and New Zealand, coworking spaces are looking to differentiate themselves with perks like nap pods, coffee machines, ping pong tables, brainstorming rooms, and even play areas for working mothers with young children. But having a strong and tightly-knit community is the foundation of every successful coworking space. This is because people have an intrinsic need for each other; they want to be able to turn to someone when a problem needs to be solved; they want to be inspired and intellectually stimulated by people in their environment. This is what BizDojo, the company behind New Zealand’s fastest growing coworking spaces, attributes its success to, as well as its diversity, flexible membership structure and global outlook.
BizDojo was founded six years ago when coworking was still in its infancy in New Zealand. At the time, Nick Shewring and Jonah Merchant were “selfishly” wanting to create an environment in which they would want to hang out.
“We’re both from technology backgrounds, and we wanted to be surrounded by awesome people doing cool stuff. What we didn’t realise was how many people like us were out there also wanting a sense of community, wanting to be around people who inspire and challenge them, and wanting to be in a place where people share opportunities,” said Shewring.
Shewring said BizDojo has a symbiotic relationship with its residents: “If our residents aren’t successful, nor are we.”
“Our success is measured by the growth and sustainability of our residents’ businesses.”
Companies like 90seconds.TV, which offers cloud video production, outgrew BIzDojo at 12 staff. The company, founded by Tim Norton, now has a presence in over 50 countries and has about 3,000 contractors and over 100 dedicated staff.
According to Shewring, BizDojo has grown at an average rate of 90 percent per year, though is expecting to grow 200 percent by the end of the current financial year, as it expands into Southeast Asia.
Like most coworking spaces, BizDojo started off with multiple membership options: a one-day rate, three-day rate, five-day rate, premium rate, coffee plus rate, and more. But a little over a year ago, Shewring and his partners Merchant and Phil Williams, realised BizDojo’s monetisation model – and by extension, the model implemented by many other coworking spaces – was flawed. There were simply too many options and members were burdened with choice.
BizDojo decided to ask its members: Why do you pay for the three-day a week membership? It was because they couldn’t afford the five-day a week membership option. On the two days that they weren’t working out of BizDojo, they were actually working out of local cafes and libraries.
Shewring felt it was a problem that members weren’t able to approach BizDojo to explain that they couldn’t afford to work out of the space full-time. Worse yet, the founders blamed themselves for it; they felt they were failing because they weren’t able to afford the space full-time.
At this point, BizDojo decided it was time to cut down membership options to two: permanent and active. The permanent desk option, which costs $790 per month and only offered in BizDojo’s Auckland branch, provides members with dedicated desk space, office storage and 24/7 secure access. The active (or hot desk) option, which costs $300 in Wellington and $350 in Auckland, provides members with flexible desk space from Monday to Friday between the hours of 8:30am and 5:30pm. By simplifying the membership options, BizDojo became far more accessible.
BizDojo currently manages three spaces in New Zealand, two in Auckland including the Auckland Innovation Precinct on behalf of Auckland Council and one in Wellington. The three spaces currently house about 260 businesses. The businesses have between one and 30 staff, with the average being four.
Members are granted access to all the spaces managed by BizDojo, including its spaces in Southeast Asia when they’re launched.
Niche coworking spaces can be detrimental
Shewring said it’s important to have a diverse community. BizDojo’s residents work across technology, entertainment and design.
“We feel that it’s detrimental to your community’s well-being if you’re just focused on tech or social enterprises or consultancy. The more diverse your community, the better the problem-solving over a cup of coffee,” said Shewring.
“For example, if you’re a game developer and you hit a wall where you don’t know how to get a client across the line or get consumers downloading your product, being able to have coffee with someone who runs a storytelling social enterprise and give you a completely different perspective on how you ground your idea with an audience on an emotional level, is more valuable than you standing amongst a bunch of other game developers who might have similar struggles.”
Tapping into Asian markets
Shewring, who recently toured Singapore and Thailand as part of a government-backed entrepreneurs abroad programme, said startups in New Zealand and Australia are uniquely positioned to tap into Asian markets, yet most head to the US to pursue growth opportunities.
He admitted that prior to touring Southeast Asia and immersing himself in local tech scenes, he had very low expectations; like many fellow entrepreneurs, he thought the only path to growth for New Zealand-based startups is via Australia and the US, but he was pleasantly surprised upon arrival.
“I had the fortune of meeting some really talented people there who re-educated me that Thailand wasn’t just about tourism. There’s a massive tech scene there,” said Shewring.
“There are 67 million people and 100 percent mobile penetration; and Thailand is one of YouTube’s top five markets in terms of viewership.
“[Added to that] the average monthly salary for a senior developer [in Thailand] is NZ$1700, which is a really good wage by local standards, especially when you consider the cost of living compared to New Zealand and Australia.”
The experience helped him realise there was a critical opportunity for BizDojo to connect New Zealand entrepreneurs to the Southeast Asian market.
“There are too many Kiwi and Australian [founders] flying to Silicon Valley and standing in a room full of 1,000 other guys with great ideas. If you go to Singapore and you’re in a room full of 1,000 people, you’re probably competing with 40 other great ideas. If you go to Bangkok, you can have one of the best ideas in the room,” said Shewring
“[Southeast Asians] still don’t like the SaaS model, but they love social media. They spend four hours a day on average on Facebook.
“I’m hoping more Kiwi companies take a different path and try other markets. The opportunity in the US is huge, no doubt, but there are other areas where they can get momentum around their product. And when it comes to funding, it’s far less competitive [in Southeast Asia].”
Speaking about Southeast Asia, Shewring recalled the story of a friend who’s based in Bangkok. The friend decided to strategically market his new product on Japan’s largest social network Line, which gained 600 million users worldwide as of February this year. In a weekend, the friend attracted one million users to his platform, an impressive number for any startup. But what’s more interesting is that it was driven by stickers. The friend designed stickers for Line users, but to download them, the users would have to sign up to his platform – a clever growth hack.
“An Australian or Kiwi [founder] would think ‘why would my marketing strategy be stickers for my awesome app?’ I wouldn’t normally connect those two things, but in Southeast Asia, you need to,” said Shewring.
Shewring said launching BizDojo into other markets is not just about affording its members the ability to work out of, say, Thailand, for a few weeks at no extra cost. In fact, he doesn’t want BizDojo to be known as just a coworking space provider, but a platform that facilitates valuable connections.
“If you’re a Wellington tech company and you’re thinking about South America as a market, I want you to be able to jump on our platform and say ‘hey I’m thinking about going over to South America to check out what’s going on. Here’s a little bit about me and my company. Who do you think I should meet?’ Through BizDojo’s trusted network of residents and other community members, you’ll be able to reach someone who is very similar to you and who can help you [uncover] opportunities in South America. That’s what we want to be about. It’s not just about allowing people to work across [multiple] locations. It’s about meeting good people who want to help you,” said Shewring.
Leveraging the knowledge of international students
One thing Shewring is excited about is BizDojo’s recently-formed partnership with a company called Dakai, which helps Kiwi companies explore business opportunities in China. The company headhunts top students in China and connects them to Wellington-based startups and small businesses. Through the students, founders get a better understanding of the Chinese mindset and market, which moves very fast and is far more complex than the US, UK and Australian markets.
Shewring acknowledged that the reason why the Chinese, and by extension, other Asian markets, are underserved by Australian and New Zealand companies is largely because of cultural differences.
“There’s a big barrier to entry when you don’t speak the language and don’t understand the culture,” said Shewring.
“The reason why we go to the US and Australia is because we all speak English. But the prize of getting into Asia is so big. Kiwi companies rarely recruit people who don’t speak English as their first language, and we don’t see them as an opportunity for us to connect with their home country. We should be asking these people to help us establish a strategy so that we can expand products into new markets.
“I would love to see New Zealand, and Wellington especially because it’s such an isolated city, hiring all these incredible students that are coming out here to study. As soon as they graduate, they get on a plane and fly home. What would it mean for the Wellington economy if we got them to stick around a little longer and help companies sell products in China or Southeast Asia?”
Don’t lean on the government
Interestingly, while government support for startups is at the centre of public discussion in Australia – specifically, the need for better government support – Shewring said New Zealand startups are becoming too reliant on government-backed initiatives and support systems.
“Sometimes entrepreneurs in New Zealand rely too heavily on Callaghan Innovation and other government and local entities. They are there to help us, not lead,” said Shewring.
Australians may be envious of New Zealand government’s support of local startups, but Shewring made a compelling point when he said startups, as private operators, need to be able to stand on their own feet. While startup communities that have government support are easier to grow and prosper, startup ecosystems need to strong enough to withstand the collapse of support structures and push forward in times of political and economic volatility.
“We’re this 4 million people dot on the globe. It’s important that we rally together and create and pursue opportunities offshore, rather than rely on local government. We need to function as a unit. As [BizDojo] moves to Southeast Asia, [I’m prepared to fulfil my] civic responsibility to help other Kiwi companies [uncover] opportunities there,” said Shewring.
“What I do love about Australians is that they’ve got a little bit more of that American ‘the world is my oyster, go for it, I’m going to push myself’ attitude. I think some of us Kiwis do that, but as a population, we’re still a bit nervous about taking risks. I really hope we can work together as a country to move past that.”
Startup Daily toured the Wellington startup ecosystem last week as a guest of Positively Wellington.