This coworking company is betting big on budget-friendly spaces across Mumbai and Pune
Mihir Shah and Nainesh Kapadia, Cofounders, YesssWorks
The coworking industry has seen a boom in the last few years with startup founders looking for cost-effective office spaces. Lucrative benefits of coworking spaces — from affordable seating costs, good infrastructure to networking opportunities and more — make it a good choice for not only budding entrepreneurs but also for founders exploring newer markets.
The coworking culture has even travelled to Tier II and III areas, and holds a promising future. Though coronavirus hit the sector severely, according to an industry expert, “The trend is expected to rise, slowly but surely. The fact that over 13 million people are already set to join the coworking league – most probably by 2020 – proves that there is no end to its growth, but only beginnings to newer opportunities and possibilities.”
To provide affordable office spaces, Mihir Shah and Nainesh Kapadia started coworking companyin 2019 in Mumbai. Today, it has four coworking spaces across Mumbai and Pune, starting at Rs 7,000 per seat.
In an interaction with SMBStory, Mihir says,
“I have worked with various startups and even co-founded three other businesses. After working in various technology sectors, I found that many entrepreneurs are on the lookout for affordable working spaces.”
With over 28 years of experience in mentorship and business development, Nainesh has helped renowned businesses and startups scale. He had a short stint of experience in the real estate sector as well.
Edited excerpts from the interview:
SMBStory (SMBS): How did you start YesssWork?
Mihir Shah (MS): YesssWorks emerged from Fundtonic, a seed funding incubator. Fundtonic had initially ventured into the coworking industry as a means to provide office space at affordable prices to its incubatees. Modern and open office spaces at affordable prices was a big hit with the incubatees and the demand spread to the startup universe.
This led to the opening of a new vertical in coworking for bootstrapped startups and eventually, established corporates, providing holistic business space solutions. In 2019, the coworking business was carved out into a separate entity to focus entirely on providing a contemporary working environment.
YesssWorks understands the need for flexible and ergonomically designed workspaces that are economical and provides a comfortable space. Keeping the emerging need of budget-friendly spaces in mind, the company was launched with its first space in Andheri, Mumbai. The second space was opened in Pune in less than a year of operations.
The pre-COVID-19 annual revenue run rate of YesssWorks was Rs 5.25 crore.
SMBS: The coronavirus has hit the coworking space sector badly. Tell us about the impact, and the effect of the pandemic on your business?
MS: COVID-19 has hit the coworking industry hard. Not only have the offices had to remain shut for extended times, but also a lot of the customers include seed funded and bootstrapped businesses struggling to survive as the economy continues to remain closed.
We believe there's always a new day for starting afresh, so we are working on new relatable approaches and products suitable for the ongoing situation, keeping the long term and probable future market impacts in mind.
The coworking industry has seen strong growth over the last three years with more than 350 coworking companies all over India. The biggest challenge is the lack of barrier to entry. Anyone with a commercial space can open a coworking business by setting up the infrastructure.
However, we strongly believe these are ‘fly by night operators’, who are venturing into coworking to utilise personal real-estate, and not as a long-term provider of the coworking community. This has led to increased competition and pricing pressures as smaller providers/landlords owning the offices are undercutting the market.
YesssWorks coworking space
We believe as customers experience the benefits of coworking, which is more than just office/table space, they will gravitate towards providers who not only offer the space, but also help build culture and community. Our community has been extremely pleased with the opportunity for business and personal growth through networking, interacting with other companies, business connections, learning sessions, etc.
SMBS: What is the market size of your sector and how are you dealing with the competition?
MS: Some industry estimates mention coworking in India growing to $3.5 billion by 2022 from $350 million in 2018.
We are sector-agnostic, catering to all types of business from freelancers, startups to established corporates. It is not really possible to point out sectors to specify the size of our target market but our focus is Mumbai and Pune, which are among the top five cities in India for commercial space and coworking spaces.
YesssWorks is known for its services and products offered to the market. We focus on ensuring a warm and friendly community culture is present everywhere for people, who visit us or are working with us.
Our value-for-money office infrastructure, providing all the amenities of contemporary office in beautiful and ergonomically designed workspaces and services, has resonated strongly with our customers.
We are a service provider providing workspace-as-a-service, and hence, we focus more on providing the best possible experience and comfort to each one of our members by understanding their individual needs.
SMBS: What are your future prospects?
MS: We believe coworking will continue to grow as more and more companies become comfortable with shared office space, and like the idea of not having to spend on CAPEX.
Rather than one or two large spaces (>50,000 sq ft), we would like to build mid-size spaces (15,000 to 20,000 sq ft) all over Mumbai and Pune targeting every commercial area. The idea is to blanket the cities, so companies don’t need to concentrate their teams in one area but can have their teams split across different hubs with seamless interchangeability.
We strongly believe this will help reduce inefficiencies like commute time and improve productivity and work-life balance. By providing familiar and similar business environments across all hubs, a coworker can sit out of any convenient hub and feel comfortable.