Co-working, Job Creation, and Innovative vs Replicative Businesses

At the Atlanta Tech Village we’ve had a number economic development agencies come through for a tour. As a new initiative for Atlanta and the Southeast, there’s a significant amount of interest and curiosity. Several of the economic development people have mentioned how they’re working on co-working space for startups in their own cities and neighborhoods.

Co-working space is great for the freelancer and entrepreneur starting a business, but there’s another, more important issue not being addressed: innovative vs replicative businesses. Not all companies are created equal. Most companies are replicative businesses where they are replicating something that is already well defined and a known quantity, like a law firm or accounting firm. Innovative businesses, on the other hand, are building something new and trying something that hasn’t been done before. With innovation comes a high rate of failure, but also an opportunity for net new jobs due to being able to generate revenue from outside the region.

In the context of job creation, it’s important to recognize that innovative and replicative businesses are two different things. Innovative businesses have greater risk, and greater reward. Co-working spaces often have both types of businesses, but their needs and challenges differ, such that one approach isn’t right for both types. To excel, it’s best to choose a focus and be the best in that target area.

What else? What are your thoughts on co-working, job creation, and innovative vs replicative businesses?