Affordability plays a key role in the success of brands
Varun Chawla, Co-founder, 91springboard talks to Sreyasi Maity from Realty+ explaining the growing trend of co-working and the changing Indian mindset.
What is the potential of Co-working model in India, given the traditional mindset of Indians?
While coworking is a relatively new concept in India, it has gained popularity in the past few years. The Indian office space sector is about 1.2 billion square feet We believe all of it can be converted into a coworking spaces over a period of time. These spaces will be able to cater to companies of all nature be it startups, SMEs or large companies it will offer them a hassle-free work experience.
When we talk about India, it is a highly value centric market where; affordability plays a key role and the success of brands like Maruti in the automobile segment and Xiaomi in the mobile segment is proof of that. Our model is targeted to similar audience and we would like to continue offering value-for-money service to our members.
Besides our value centric approach, we at 91springboard offer an ecosystem that thrives on community. We provide working professionals a space to enrich themselves not just professionally but also on a personal level. We offer career assistance, networking opportunities, learning & development activities and much more besides the conventional advantages such as lower costs, hassle-free infrastructure and flexibility.
When we launched our first few hubs, we saw an encouraging response from startups and freelancers. This was fuelled by the country’s burgeoning startup ecosystem. However, in recent times, we have noticed that SMEs and corporates are also keen on setting up their offices in a coworking space. As per our research, companies can save nearly 25- 30% of expenses when they opt for a coworking model as compared to a traditional office space.
The Indian mindsets are evolving, and our growth story is an example of this evolution. We launched 91springboard in 2013, a time when the concept of coworking was alien to India and today we have 27 hubs serving over 2900 companies.
Which are the cities/regions that have shown high demand for coworking concept & why?
All seven metro cities like Mumbai, Delhi, Bangalore, Hyderabad, Chennai, Kolkata, Pune are seeing high demand for coworking. About 4-5 mn sq. ft of office space is concentrated in Bangalore and there is another 4-5 mn sq. ft spread across Mumbai & Delhi.
Coworking solves a lot of key business needs like providing flexibility, affordability and overall convenience. Additionally, communities enable business growth through networking and collaborations.
The business model for co-working provider companies
The term “coworking” is used as an umbrella term to define various types of workspaces like bespoke offices, managed offices, coworking and niche spaces limited to coders, artists etc. Coworking players work in different operational models like revenue share, straight leasing etc.
As for us, we operate in a straight leasing model. Our design & set-up team then designs the space to make it hassle-free and vibrant. We will continue to build products from the ground up that will be affordable and high quality for the maximum addressable market size. Our primary source of revenue is the variety of membership plans we have on offer that range from a day pass to monthly memberships.
We also provide customization of our spaces to suit the needs of large teams. The idea is to deliver speed, flexibility, and community in a value conscious package.
Are the Co-working providers tying up with developers?
We have seen developers either building their own coworking spaces or tying up with other operators to offer coworking spaces. Not just developers but also International property consultants (IPC) have shown interest in the coworking model.
What are the challenges facing this niche segment?
Coworking is not a niche segment and it has grown to be a full-fledged industry. We are in an operationally heavy business and we have typical challenges of an offline operationally heavy business. Hence, we know that we must build a strong operations team that constantly focuses on delivering quality. Though, we have an asset light model, this is a capital-intensive business where funds are utilized to set up spaces from scratch.
Further, being in a service industry, we do come across challenges in terms of identifying the right talent and ensuring they are well-trained to offer our members the 91springboard experience. We have invested in several training programmes and have a strong employee engagement programme in place to ensure there is less attrition and our employees are happy.
As coworking in now a decentralized term, there is strong competition from organized as well as unorganized players. This gives us an opportunity to constantly be on toes and offer our members an experience they will never forget.
We have also noticed that many coworking spaces talk about building communities. It is easy to create a feeling of community and oneness when you run a family business, but it can be difficult to build a community with people from diverse sectors and based in different cities. We took upon the challenge of running a community at scale and have been successfully doing so since 2013. Recently, we launched a member app and have seamlessly integrated human interactions and technology to offer our members the benefits of community at scale by breaking geographical barriers.
How has technology been an enabler for these new asset models?
High speed internet, cloud computing has enabled the growth of flexible workspaces. With many companies implementing cloud computing strategy, location is no longer a constraint. Co-working users can access data and work efficiently from multiple locations. Mobility and flexibility are increasingly revamping the office space sector and making corporate real estate strategies extremely alert and future proof.
Having said that, as humans, we still need that physical connection, the sense of trust that can only be nurtured at 91springboard where we organize various networking, learning and fun events for everyone to benefit from the experience of other people. We would like to make magic through collaboration and value wisdom & experience more than just the application of information. 91springboard leverages the power of people to create tomorrow’s People of Power.