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Rant: Coworking vs. Incubator

5 minute read
by Alex Hillman

Recently on the coworking list, the “what is coworking” debate has flared up again, this time comparing it to an incubator.

For context, the original question was posed:

I’m wondering if you all can provide some wisdom on the difference between a coworking space and an “incubator”.  Is it just semantics? If there are more substantive distinctions, how would you boil them down? –Adam Huttler

Some excerpts from responses include:

  • “…one thing that incubators do most reliably is fail.  Largely because there’s insufficient collaborative critical mass, and because they don’t typically include the services that early stage startups need to get momentum, such as software developers, graphic designers, and tech writers, just to name a few.  Finally, most incubators get their start as real estate plays for unmarketable space.” -Axon


  • “As a result, you have a more diverse work environment of people who are self-sufficient, as opposed to an incubator, where that isn’t necessarily the case. Incubators and coworking spaces are not equivalent, but they share a lot of the same DNA. Like apes and humans.” -Tony Bacigalupo


  • “…many of our businesses have gotten stronger by being in proximity to other like-minded business people. But that’s mostly a product of the community that’s naturally created by the way the space is designed. People that like each other talk. It works.”” -Derek Young


  • “Best option for a company is to look around at what exists and find a home where they feel welcome and can do the best work.” -Nate Westheimer

All good stuff from people whose opinions I’ve come to respect. The whole discussion got my gears turning. So, after a few days of chewing, I decided to respond.

Note: I’ve been in an admittedly high-stress mode for the last week, so the rant probably comes across more intense than it needs to, but the contents are still valuable and I wanted to share here what I wrote on the google group.

So here it goes:

The simplest way to approach this is the same way we determine what operations fall under the coworking umbrella: their core values. While incubator and coworking businesses services tend to overlap, their individual purposes are very clearly defined. Incubators can encourage coworking. Coworking can incubate independents, businesses, and even products and services.

Just remember, in all cases, the core values remain in place and, more importantly, in prominence. Community, Collaboration, Openness, Sustainability, Accessability.

In the last year, I’ve seen all of the above take place.

Incubation encouraging coworking

DreamIT Ventures is a Philly version of the now popular Y-Combinator model, sort of a “startup summer camp”. Startups apply, recieve a small amount of seed funding, and are placed in physical proximity with a number of other startups that share, at the very least, one thing: a reasonably common place in their startup cycle. The business services and cash aside, I was lucky enough to consult with one of the DreamIT startups and quickly realized (and I wasn’t the only one to verbalize this) that the REAL value in the program was the comradery of growing your startup together alongside other startups. Sharing in successes and failures. Giving and recieving advice. Becoming stronger as a collective of teams.

“Funding Day”, their “summer camp graduation” event, was last week, and seeing the result of 4 months of growing businesses together is something that’s amazing.

Coworking incubating independents, ideas, products, teams, and even regions

Many of you already know about the activities and results that we’ve had organically form within our community at IndyHall. Some of the larger succsses are iSepta and, but there are other, less visible ones: we’ve been there for more than a handful of people who left their jobs that they hated to go independent, and they credit the community of Indyhall for allowing them to be able to be comfortable taking the leap. We’ve had our fingers in dozens and dozens of events that have quite literally changed the landscape of the city.

I’m not saying this to brag, as it has nothing to do with ego. My point is, coworking has such immense gravity and influence on more than just where people are working. Even the members we’ve had that joined simply for desk space quickly realized what they were involved in, and without anyone asking or telling them to, changed their tune and became more community oriented.

In all of these instances, the core values have been at the forefront of an initiative and the results have been hugely positive. I know I have a habit of getting preachy, but it really comes down to the recipe model (or the pizza analogy, as Tony has taken it). If I order a steak and it’s got a side of greens on the plate, that’s fine. But if I order a steak and I get a salad with a couple of strips of sirloin across the top, I’m going to be pissed.

Incubation is extremely valuable, with and without coworking as part of it’s model. Coworking is extremely valuable, with and without the incubation.

Call a spade a spade. Get over your identity crisis.

Be a part of a community, and be a community leader. If you’re not doing one of those two things, you’re probably not coworking.

Encourage collaboration at every opportunity. Being open and transparent helps that.

Sustainability is just as much about eco-friendly practices as it is making sure that the things you’re doing within your community work towards it’s ability to sustain itself.

Accessibility, to me, means not being exclusive. If you asked me a year ago if I expected the diversity of IndyHall to include government-focused business strategy consultants, green home developers, video game programmers, and educators, I’d have laughed. But today, we have all of that and more. Accessibility of the resources to anyone who benefits from them is important.

I’m not here to evaluate your business model. My only concern is that you’re making enough money to pay our membership dues.

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Hey, thanks for reading!

Alex Hillman I am always thinking about the intersection of people, relationships, trust and business. I founded Indy Hall in 2006, making us one of oldest fully independent coworking communities in the world. This site is packed with the lessons and examples I’ve learned along the way. You can find me on Twitter, too! 🐦 Say hi.