WeWork India has raised INR 200 Cr in debt and equity from investors and said it reported its best quarter in terms of sales. The company didn’t disclose the names of the two investors. With the funding, the company expects to expand its business and become profitable in 2021.
“The new capital we have raised will help us in continuing our upwards momentum and truly explore the potential of flexible workspaces in the Indian market,” said Karan Virwani, CEO, WeWork India.
“We are poised for sustainable long term growth and are aiming for profitability in 2021,” Virwani said.
WeWork India, which is owned by Bengaluru-based realty firm Embassy group said it reported its best quarter yet in terms of sales, after leasing 10,000 desks across 700K sq ft in the three months ended March 2021.
According to the company, WeWork’s enterprise portfolio recorded a 10% jump to now constitute 60% enterprise members helped by strong demand. This further facilitated the opening of its new workspace in Bengaluru.
In June 2020, WeWork Global committed $100 Mn in its Indian subsidiary. Earlier, in 2019, WeWork India had raised around INR 500 Cr of debt.
With the funding, Sandeep Mathrani, global CEO of WeWork, had also joined WeWork India’s board. WeWork India head Karan Virwani had told CNBC TV 18 last year that the We Company was set to take an equity stake of 20% in WeWork India by the end of this year.
Started in September 2017, WeWork India operates on a brand franchisee model controlled by Embassy Buildcon LLP, which is owned by real estate businessman Jitu Virwani and his son Karan Virwani. Embassy Group has a joint venture (JV) with The We Company to operate its coworking brand WeWork in India.
Virwani owns close to 90% shareholding in the JV. The company has expanded with over 5-plus Mn sq ft of space leased in 35 locations across Noida, Gurugram, Mumbai, Bengaluru, Pune, and Hyderabad.
Over the last decade, coworking spaces garnered more interest among entrepreneurs and freelancers. Across India, many companies started offering such services with the trend. However, the lockdown significantly hampered the growth of the sector. Companies such as 91Springboard, Awfis, Innov8 (OYO), GoWork are a few startups that are competing within the Indian coworking space domain. Last month, coworking aggregator Stylework raised INR 4 Cr in a pre-series funding round for expansion.
As the lockdown restrictions ease, it remains to be seen how coworking spaces recuperate amid the new-found work-from-home culture and adapt to new requirements. For instance, the need for more private spaces in offices as opposed to open spaces. This combined with high costs in the form of maintenance and utility bills is likely to pose more difficulties for companies operating within the coworking space.