Having recently read the Wall Street Journal’s article “Russia’s Once Budding Startup Scene Retreats” (September 9, 2014), it makes us realize a few things about work spaces, the state of entrepreneurship and good intentions.

Today, it seems that many communities’ answer to economic development questions centers around entrepreneurship and supporting the growth of new companies to create jobs. While we firmly believe in many aspects of this concept (with a few caveats), one must be very careful in jumping to certain historically easy conclusions about “if you build a building, they will come” mentality. And in this case, if you build it BIG, they will come in droves mentality.

In Russia, the Skolkovo HyperCube is the latest example that creating a workspace for entrepreneurs and startup companies is a tricky equation. One must balance utility with design aesthetics and be certain to keep the core purpose of the building firmly in mind.

In the case of the HyperCube, this doomed venture created a 27 million square foot building to house 259 grant funded companies. In case you haven’t already done the math already, that means every company has 104, 247 square feet.

On average, each company received $1.54 million Skolkovo grants, and last time I checked, most early stage companies don’t need much more than a few thousand square feet, let alone office space the size of two football fields. Needless to say, the building sits as an empty carcass and may never launch.

Buildings provide a place for people to go, to meet and even to work. Work can occur almost anywhere these days, and arguably today more work is getting done in less space than ever before. In fact, over the past four years, the average square feet per employee has dropped from 225 square feet per person to 150 square feet per person.

If you are considering building a work space in your community, be very aware of the functionality it needs and the role it is designed to play. Additionally think about the economic viability the model must have to create a sustainable operation.

Most consultants that work with business incubators will tell you that 30,000 square feet is an optimal size. If you are building a coworking space, it is very hard to make most operations sustainable without outside economic support if you don’t have at least 5,000 square feet. There are many considerations in looking at size versus functionality versus goal, but some element of common sense will guide most decisions.

In the case of the HyperCube, this is “good intentions gone wrong” and “work spaces gone wild”. In the past five years, Think Big Partners has seen many good buildings and a wide variety of well-run incubator and coworking operations.  We have traveled the country and can firmly say that there is no “one size fits all” formula for success. Regardless of your model, however, your community and your goals must be translated into the proper physical form with effective execution that produces results.

We don’t need any more Skolkovo HyperCubes!



About Herb Sih

Herb Sih is Managing Partner for Think Big Partners, an innovation-driven firm focused on advising the world's most progressive-minded cities, companies and entrepreneurs. Herb has a deep background in advising entrepreneurs and high growth companies, accelerating innovation and helping communities solve complex problems by building smart cities and connected technologies using human-centered design principles.

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