For many startups I don't really see a great advantage to a formal office setup in the in initial phases. In the current climate where funding is had to come by solutions like this make a big difference.
Up until today, I still write all of my code either at home or at my local coffee shop. It seems really pointless to have to fork out that kind of money when you're just as capable of collaboration in a cave.
The current company I work for is heavily funded, yet we still have our meetings in the CEO's mom's house.
If I'd have got an office in January 2007, I would have met the Queen (of England) at the opening of a new office block (built by the same company). But I didn't for health reasons. Still, there's worse things than not meeting the Queen.
