Awfis, a shared workspace provider, is set to expand its presence in Calcutta. The Delhi-based firm, which has the backing of Sequoia Capital, is looking to add 2-3 additional centres in the city and double the number of seats to close to 3,000 from 1,500 at present.
“In Calcutta we have three centres – one on Camac Street, one in Salt Lake and one in Rajarhat. Between these three centres, there is approximately 1500 seats and we will add 2-3 centres in Calcutta, doubling the capacity to 3,000 seats,” said Amit Ramani, founder and CEO of Awfis.
The expansion in Calcutta is part of the national expansion of the start-up firm, which received $20 million in 2017 from Sequoia Capital. The company is looking to venture into tier 2 cities and double its existing footprint of 19,000 seats.
“We are in Delhi, Mumbai, Bangalore, Hyderabad, Pune, Calcutta, Noida and Gurgaon. We will go to Chandigarh, Kochi, Indore, Bhubaneswar, Jaipur and Ahmedabad. Our growth has been phenomenal. In March 2016, we had 400 seats, in March 2017 we had 4,000 seats and in March 2018, we are close to 19000,” said Ramani.
The SME sector constitutes half of the business of the firm followed by corporate houses at 35 per cent and the remaining 15 per cent constitutes freelancers and startups. Mercedes Benz, Hitachi, Vodafone and Sharekhan are among the major companies operating from the Awfis centres.
According to Ramani, there are some key advantages of co-working spaces.
First, the shared workspace will provide cost savings of up to 20-25 per cent annually compared with conventional leasing. Second, the model provides flexibility of both long and short tenure of rentals. “Finally, the companies can focus on investing in operations rather than real estate for better returns to the shareholders,” he said.
The company follows two broad business models – straight lease and joint venture with the landlord involving a revenue-sharing arrangement. “About 50 per cent of the business is straight lease and the remaining is joint venture and management operator model. As we expand into tier 2 locations, there will be more of the latter,” said Ramani.
“We have some capital for expansion in the next 6-9 months. But we are a growing company and we will have to raise capital in future,” said Ramani.
Source: The Telegraph