From Startup to Scale-Up: Office Space Considerations

For most startups, growth is the principal objective, but when budgets are tight, choosing a suitable startup office space can be tricky. Many new businesses cannot afford private office space that they can grow into, but that can mean they have to move offices at least a couple of times as they start to scale.

In some ways, this is a nice problem to have. It means your business is doing well. But spending time worrying about leases, office fit-outs and rental agreements is time that could be better spent on growth.

So, what’s the solution? Well, modern and flexible office spaces are available that allow startup businesses to upgrade to larger offices in the same building or secure more desk space as they scale. But what sort of things should you look for?

Here, we’re going to highlight the importance of aligning business growth stages with office space considerations. We’re also going to discuss the office spaces that are most suitable for startup and scale-up businesses and the different types of contracts that are available.

Understanding the Journey from Startup to Scale-Up

Not all startups will scale up. In fact, less than half of the over 800,000 new businesses that were registered in the UK last year will make it past the startup stage. But that’s another story. For those that do make it past that high-risk stage and grow into profitable businesses, the journey from startup to scale-up can be stressful and demanding but also very exciting.

Scaling up brings lots of things, including the need to raise additional finance, invest in technology, optimise your processes, deploy new marketing strategies, increase your headcount, and inevitably, search for new office space.

What is a startup?

A startup is a business that has been newly formed and is in the earliest stages of its development. Startups focus their time on developing and testing a new product or service before bringing it to market.

As they have no track record, market position or established customer base, they are extremely high risk and failure is common. However, the rewards for startups can also be high, as their low operating costs allow them to increase their profit margins and grow their operations quickly. 

What is a scale-up?

The technical definition of a scale-up is a business that has grown its turnover or number of employees by 20% or more in each of the last three years. Scale-ups have a product or service that is profitable and a growing number of happy customers.

Scaleups have a business model that is proven, so they can focus on ‘scaling’ their operations by expanding their market share, growing revenue and increasing their workforce to achieve higher levels of success.

Office Space and Considerations for Startups vs. Scale-Ups

Startups

Many startups don’t need a formal workplace and many begin their lives in accelerators or incubators. However, when the incubation period is over, a shared office in a coworking space can be a good next step. Coworking spaces tend to be in central locations, often with prestigious postcodes and excellent transport links. That gives startup businesses access to the talent and amenities they need to grow.

Scale-Ups

In terms of their office space, scale-ups typically look for offices that are a reflection of their culture and can become a powerful employee attraction and retention tool. They also want a space that gives them room to grow, typically on short-term deals as their businesses are constantly evolving. Scale-ups typically favour agile office space designs that boost collaboration and have a variety of workspaces to support different types of tasks.

Office Space Options for Growth

Growth is a milestone worth celebrating, but it can also bring difficult decisions. While you’re likely to be a specialist in your area of business, you may not have a good grasp of your startup to scale-up office space options. With that in mind, here are a few things to think about.

Part-time office spaces

Part-time offices can be a cost-effective choice for growing businesses. Two businesses rent a workspace together and share it between themselves. That gives each access to the office for two or three days a week. This type of agreement works well for startup and scale-up businesses that offer hybrid working, as neither business has to pay a big chunk of its budget to rent an office full-time.

The challenges of this type of agreement include scheduling conflicts - you may not always be able to access the office when you want to - and there will be limitations as to the storage and personalisation opportunities.

Full-time office spaces

For businesses that require a full-time physical presence, you need to find an office space that meets all your requirements. As a growing business, you’ll typically want to host meetings, take private calls, work collaboratively and have quiet areas where your team can concentrate on individual tasks.

Managed offices are an option as you can personalise the office to suit your needs, but you will usually be tied into a longer deal. Coworking spaces can be a good fit as they are available on short-term deals and provide an ‘all-inclusive’ service.  

The challenge with full-time office spaces is that they’re less flexible, making it difficult to adapt to shifts in business needs and workplace trends. They also come with a higher cost, which can be financially draining, particularly if they’re underutilised.

Coworking spaces

Coworking spaces are offices where workers from different companies share the same building. They typically have several types of space so you can choose where you work, and include everything a business typically needs in the price, such as Wi-Fi, access to meeting rooms, a staffed reception, utilities, furniture and a shared kitchen.

One of the benefits of co-working spaces is that they’re available on short-term deals and you can rent more or less desk space as and when you need it. That makes it a popular choice for startup office space but also scale-ups that don’t have the time to choose, design or fit out their own workspace.  

There can also be challenges with coworking space, particularly around noise and distractions. There may also be a lack of privacy at times and you will not be able to personalise the office in any way.

Agile office spaces

Agile offices feature a variety of spaces that facilitate different working styles and encourage collaboration and creativity. Agile office design is a good fit for startup and scale-up businesses, as it allows you to adapt your environment and facilities quickly to suit the changing demands of your business and teams. It can also boost engagement between all levels of workers and help you create the sort of workspace and culture that people want to be a part of. Agile workspaces also typically require less square footage than more traditional layouts to help you reduce your costs.

A challenge of this type of flexible workspace is that monitoring team members and tracking their progress can be difficult. It also requires enabling technology and IT infrastructure.

Matching Your Office Space With Business Growth

If you run a startup or scale-up business and don’t know what your headcount is going to be in a year or even a few months, coworking space is likely to be your best option. In a coworking arrangement, you can choose from private offices, studio space and fixed desks, so there’s a solution for every business. Term lengths are typically 12-18 months, although many startups opt for rolling monthly contracts for greater flexibility. You’ll be charged per desk per month - and that includes everything you need.

If you’re an established scale-up business and have some room in your budget, you could opt for a managed office. A managed office is an empty office that you can furnish and equip to suit your needs. The office provider pays for the fit-out and you’ll be charged per square foot per year, and this covers everything. With typical terms of one to five years, managed offices give you less flexibility than a coworking space. However, you can make the office your own and personalise the design to enhance your culture. 

Read more about whether serviced offices, coworking spaces or managed offices are the right fit for you.

Find Your Perfect Fit

Whether you run a fledgling startup or an established scale-up, we can help you find flexible workspace for every stage of your business’s journey.

Get in touch with our experts and we’ll match your business to startup office space that fits your budget and helps you get the best from your team. We can arrange viewings, attend them with you and even help you negotiate the best price. Our service is provided at no cost to you.