I'm not sure what "otherwise" is supposed to mean here. Isn't the whole point of the "space" in the first place to enable the "employee base" to be more productive there than at home or remote?

Maybe that employee base wouldn't need to grow so fast if the existing employees could be more productive by, say, using existing space more effectively.

Lastly, it seems to be something of a cliche how hard and/or expensive it is for startups (especially, as you mention, when growing) to deal with space. I am, however, skeptical that the decision of having open plan offices is based on any kind of rigorous decision making rather than trend-following and following the path of least (initial) resistance.