- Women-focused coworking operator, The Riveter, is shutting down all of its locations.
- While the pandemic certainly impacted operations, it is not entirely to blame for the closures.
- Despite media suggestions, the impact of this high-profile closure on the coworking industry will be minimal.
News broke out recently that women-focused coworking space operator, The Riveter, is shutting down all of its locations.
In a blog post written by CEO and co-founder Amy Nelson, The Riveter announced that:
“During the course of this devastating pandemic, the safety and health of our employees and members have been our top priority. As these safety concerns and unforeseen circumstances continue, we’ve been forced to make the tremendously difficult decision to close our coworking operations.
“The Riveter will be shifting focus towards strengthening our online community – 30,000 and growing – and continuing to be a resource for all working women during this unprecedented time.”
A couple of months ago, in March 2020, the Riveter put 34% of its staff on standby. At the time, Nelson stated that The Riveter had a strong business and they “fully expect[ed] to bring back everyone”.
In late 2019, the coworking space operator announced that it had plans to open 100 coworking locations by 2022.
Is COVID-19 to Blame?
Prior to the pandemic, in January of this year, The Riveter announced some staff cuts to its coworking operations in order to grow its digital platform, which at the time boasted over 9,000 members.
It’s worth noting that “less than half of its [The Riveter’s] revenue comes from coworking rent fees, and 80 percent of its membership base does not work out of the company’s nine locations across the U.S.”
Speaking to GeekWire about the WeWork fallout, Nelson stated that “we have a much stronger uninterrupted focus and we’ve always had diversified revenue streams that aren’t ancillary services to coworking.”
While the COVID-19 pandemic certainly impacted the operations of coworking spaces around the world, it seems that The Riveter had wanted to focus more on its digital platform rather than its coworking business well before the pandemic struck.
As to what prompted the decision to focus more on its online community since early this year vs its physical spaces is yet to be known.
What Does this Mean for Coworking?
In a recent article, GeekWire noted that “the dramatic shift [to remote work] is bad news for coworking companies such as The Riveter and industry giant WeWork, which is also struggling as companies rethink their return to the office amid health and safety concerns.”
While some coworking companies will have a hard time recovering and others likely won’t survive, we at Allwork.Space disagree with the statement.
Like we recently wrote, the office is far from dead, and it never really will be.
Though workers will increasingly ask to work remotely, the pandemic has shone a light on the struggles of working from home. More importantly, research has found that workers miss the social interactions they had at the office, with many saying that they are impossible or extremely difficult to replicate in online environments.
This means that The Riveter’s closure doesn’t really mean much for the coworking industry.
Though it’s unfortunate to see the company close its locations, the coworking industry as a whole will survive the pandemic and will come out stronger in the medium and long term, as organizations turn to these type of spaces to de-densify their headquarters and reduce or eliminate the commute for those who wish to work from an office environment that’s closer to home.