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Workspaces India: CoWrks fuels ambitious growth plans

3 MIN READApril 16, 2019
CoWrks, a Bengaluru-based workspace solutions company, has just appointed US investment banks Morgan Stanley and Bank of America Merrill Lynch to conduct a US$350m equity fundraising exercise. CoWrks is privately owned and promoted by the Menda family - the same family who own RMZ Corp, one of India’s largest commercial real estate developers - and this is the first time the business has sought external capital to accelerate its growth.
 
CoWrks’ end-to-end evolution
 
Abhishek Goenka, CEO, CoWrksAbhishek Goenka, CEO of CoWrks, describes CoWrks’ journey over the last three years, in what has been a rapidly changing industry: “We started off with the customary co-working option of creating centres which were fully fitted out and updated, for multiple companies or individuals. From that, we started to run managed offices, where we fit offices and operate them for single enterprises. And now we’re gradually getting into a few asset-light models - we’re doing something around meeting rooms (CoWrks recently launched a meeting and events platform named Converge) and working-on-the-go.” 
 
Today, in Goenka’s words, CoWrks sees itself as an “end-to-end workspace solution company. From formal, to shared, to distributed - any kind of workspace that you need, anywhere - it’s all available with us. If you want a formal, dedicated, non-sharing office of your own - we can do that. If you want to work in a restaurant or café, on an app, you can do that as well.”
 
As with the co-working sector at large, CoWrks now caters more to larger enterprises than to start-ups. “Enterprises make up 70% or more of our customer base,” says Goenka.

Market momentum

Goenka accepts that WeWork, which launched in India at around the same time as CoWrks, is clearly a competitor. “But now several players have launched in the Indian market, in addition to WeWork. We also have some players who are at a lower price point and we end up competing with them too. I think, though, that the market is large enough today to have multiple players.”

At some level, continues Goenka, “we do not want to keep differentiating ourselves, particularly from WeWork, because we would like to benefit from their strategy and the good stuff they’ve done so far in creating the necessary awareness of this format and market acceptance. Obviously, though, we’d like to distinguish ourselves in terms of the kind of community elements we bring, the kind of vibe we have - we tend to be a little more understated and sophisticated, as compared to some of our competitors.”

The workspace product

The ‘experience’ is an extremely important factor in workspaces, says Goenka: “Customers are very discerning and therefore we continue to invest and focus a lot on the experience. We’ve also learnt that the Indian market is - no surprises - very, very  price-sensitive. So despite creating world-class and top-of-the line workspaces, price elasticity only takes you so far. That’s caused us to rethink a little bit, and to create products at different price points.”

Workspaces are of course about the space itself, but Goenka adds that CoWrks is a ‘technology-first’ company: “We incorporate technology in all the elements of our business, from design to operations to member engagement. We are a very big tech player.”

Community is also very important, continues Goenka, “because it creates a platform for members to interact with each other, a platform for businesses to interact with each other, for individuals to interact with businesses, and for external businesses to be able to come in and provide curated offerings to the community.”

Growth plans

In India, CoWrks currently has 23 centres - located across Bengaluru, Mumbai, Hyderabad, Chennai, Delhi and Gurugram - but is looking to triple that number to around 75 centres, with new locations in cities like Pune, Ahmedabad, Chandigarh, Indore and Jaipur. The business is also looking to triple its membership, from 23,000 to 75,000 members by year-end.

“We have ambitious growth plans,” says Goenka, explaining the purpose behind CoWrks’ capital-raising exercise, “both in India, as well as at some point in the near future to grow internationally. We are conducting a formal study of which countries, but at this point our only targets are going to be Asia Pacific countries.” 

Coworking and flexible workspaces will be discussed in further detail at GRI Offices and Parks India 2019 in Mumbai on 25 April and India GRI 2019 in Mumbai on 18-19 September. 
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