Today with everything going hyperlocal, with one click you can order a cab, food, groceries, clothes, furniture, home décor, handymen, stylists, personal assistants, and what not! There is an app to order almost anything one could possibly think of just-in-time. But what if one could also choose a place of work and book it right off the app? With changing work patterns of millenials, a workplace has ceased to be that one fixed building in the urban centre you used to go to 30 kilometres away. The anytime anywhere workplace trend is the new thing sweeping in, slowly redefining our relationships with our workplaces.
Co-working spaces are a new hit in our evolving startup ecosystem. Today one can choose to decide where one can conveniently work from, by simply pressing a button on the app. One such startup, working on the Uberization of the workplace, is Awfis – a tech-enabled new age venture that is redefining the way work gets done in the current business environment. It provides workspaces for Small Medium Individual Local Entrepreneurs on a just-in-time basis.
Founded by Amit Ramani last year, Awfis offers customers the facility to book workplaces for a period, ranging from an hour to eleven months, across cities such as Delhi, Mumbai, and Bangalore. It can be done through their mobile app – available on Android and iOS platform. Apart from its own managed pro-working spaces, Awfis also offers a repository of third-party meeting rooms in hotel brands, like Lemon Tree Hotels, Hyatt, and Trident, amongst others, across India. The Awfis network, which boasts of 1500 seats pan India, aims to ramp it up to 4,000 by the end of this month, and an ambitious 10,000 by the end of December, in order to become the largest player.
The Changing Workplace Trends
Amit Ramani is no fresher to the real estate business and office spaces. Currently, he is also the President and Managing Director of NELSON Asia, which provides design and real estate consulting services. After graduating from the School Of Planning and Architecture, New Delhi, he went on to do his Masters in Architecture at Kansas. Post that, he undertook another Masters in Facility Planning and Management from Cornell University. Says Amit, “Interestingly, my thesis in Cornell was how do you create environments that make people more productive.” No wonder his foray into Awfis is backed by the solid experience he has gathered in this vertical for more than 15 years.
During his tenure with Nelson, he has designed interesting work spaces for clients in India such as Airtel, Cisco, Qualcomm. Notes Amit, about the changing workplace trends, “We saw a lot of trends changing in terms of what people were perceiving as work space. They wanted it to be young and energetic. Secondly, there was clearly a move towards owning infrastructure that was credible. So, earlier you had large corporates owning big glass buildings while SMEs and startups owned sub-standard places because of affordability. But we saw that as soon as it became a serious business, people wanted to have a space of their own and a credible infrastructure. That change is happening in India.”
Added to that are the challenges posed by pollution, traffic, and difficulties faced by young mothers, and those with ageing parents at home, which make a commute of three hours difficult for a large section of the society. Hence, the need to have centres or workplaces which are closely aligned with where people stay.
Amit points out that in US, the co-working trend started when people began delving into alternative offices to reduce real estate footprint because it’s expensive. So, companies came up with satellite offices and mixed bag strategies, like work from home, in order to save money and provide flexibility. This got shifted to co-working spaces as people can’t work from home all day long. Hence, the work place slowly extended to coffee houses and then to co-working spaces. He recounts that in 2006 there were 3 co-working spaces in US while today there are as many as 860. So that’s the change that’s happening all over. Similarly in India, two years back such spaces were in single digit and have now mushroomed to over 50.
Thus, powered by his experience in design and the new face of workplaces, Awfis wants to build an entire ecosystem of such workspaces to cater to the needs of the millenials. Adds Amit,
“India is currently witnessing a revolution in the startup and entrepreneurial culture, triggering a rise in the mobile working population. We are in the process of creating the largest network of managed workspaces and meeting rooms that will enable users to find a space within a 10 minute driving distance across all major metros. The Anytime, Anywhere network of spaces will enable the young Indian workforce to work near home.”
The Awfis Environment
The new age office environment has seen the onslaught of work being done from laptops, iPads, iPhones and diminishing desktops. And a typical work day is now hardly a full day spend at desk. Hence, with changing trends, more and more collaborative areas are making their way into an office environment. Vibrant office environments are being created that react to people’s patterns of work.
“Millenials work very different from gen-Xers and baby boomers. So, while we created our physical infrastructure, a lot of thought has gone in on our understanding of how people react to their work spaces. For instance, they might not want to sit in a meeting room for an hour, or what is the kind of chair they want to sit in when having a casual conversation. Hence, we are reacting to how people are most productive in their space and have built activity-based settings in Awfis.
Activity-based settings is what is at the core of Awfis. It allows people to react with space the way they function and the way they are most productive. The size of workstations, the height of panels, the transparency created through glass panels (instead of a closeted space), flexible seats provided in interesting ways, lounge seating, pods where one can listen to music to distress, two person meeting pods where people can have quick conversation, and phone booths for private conversations are some of the features that characterise the environment.
The seating plans are built around flexibility – starting from an hour and going upto 11 months. So, one can book a meeting room, a single seat or more, right from the app. This is one of its major strengths which allows for complete transparency. Hourly rates start from INR 300 to INR 700 for a day, for booking a desk. The monthly pricing starts from INR 5,000 and INR 11,000 per seat per month for flexi and fixed work stations respectively. The pricing is inclusive of all amenities like unlimited Internet, hot beverages, meeting and printing credits. So, from someone who just needs a workplace for an hour to someone who needs it for few months, there is something for everyone.
Additionally, the technology within the space allows one to do a lot more. Through multiple partnerships, the team ensures one can do everything at its centres – buying anything through the app, paying for additional credits, ordering food from Faasos, ordering stationary, and buying financial services.
Each centre also has a dedicated community manager whose sole job is to take care of community members. This aspect is important for Awfis as it aims to create a sizeable community. As per Amit, competitors who are focused on community play, have sub-300 seats while Awfis is aiming to have 4,000 seats by the end of March and touch 10,000 by December-end. So, he is counting on scale, to be in a position to guide/drive trends in the co-working space. And a major part of this hinges on its partnerships with hotels, or so to say the five-star meeting rooms.
The Five Star Meeting Room!
Says Amit, “We aspire to become the Uber of offices. But if we don’t have a technology platform that integrates our spaces to the readiness or ability of people to book an office just in time, then it is not possible. What we are striving at is that within a 10 minutes radius, in any major city where people do office business, you will have an Awfis centre. And that’s why we are expanding fast, as then only we can say we are truly just-in-time. Hence, we came up with the idea of signing up hotels so that one could book a five star or a three star meeting room right off our app. Because we believe one size does not fit all.”
The underlying idea was to utilize the already existing hotel network, reach out to a wider audience, and thereby expand faster. Amit explains that depending on who you want to meet–a CEO of a high flying organization or a VC or a colleague–one would want to book either a five star or a three star or a normal Awfis meeting room. So, what Awfis aims to do is provide all sorts of options to the user, so that anything related to his work day can be taken care of. He further adds,
“Real estate being a challenging business, I am not presuming that we can have a real estate coverage within 10 minutes across 7 cities in six months. It will take time. But if I can leverage the already existing hotel infrastructure, it works to my benefit. It’s a 10 minute conversation that gets them on my app, and once they are on my app, I can add this 20 locations to my network. It is a truly underutilized asset. So, just as Uber is utilizing the underutilized taxi’s time, we are doing the same with the hotels’ inventory.”
Hence the partnership with hotel brands, like Lemon Tree Hotels, Hyatt, Trident, etc., to add to its inventory of third party meeting rooms.
Utilizing Under-Utilized Spaces
Given that real estate is a capital intensive resource, Awfis has resorted to a combination of models to ensure the viability of the model. Or as Amit puts it, “I look at real estate in the black and yellow taxi phase. Not a lot of innovation has happened in this market – any landlord wants security deposit, long term leases. So, to convince people we are the Uber, first we have to make our own Meru. We had to create our own infrastructure which we did with straight leases on some of our locations.”
In this model, Awfis has embarked into long term leases and would recover it in small chunks by leasing out to community members. The second model that it has entered into is ‘managed aggregation’. In this model, the landlord brings the space to the table, Awfis brings in its understanding of the space and infrastructure, thus both jointly invest in the capital investment and then share the profits. Another model being followed is the ‘asset light’ model which means that the landlord makes the investment on infrastructure and builds it out, Awfis pays him out over a certain period through rentals and lease improvements. Amit admits that the managed aggregation model is allowing them to add the supply very quickly.
Awfis is focusing on taking the dead area or the under-utilized area in the building, as it’s the hardest to lease, and build on that. So, out of the proposed 10,000 seats, Awfis aims to build 5,000 through straight leases, and the rest through managed aggregation.
Footfalls and Future
While the idea of booking one’s office on an app without actually visiting it might seem a bit tricky, what is being observed is that after having made the first commitment and having a positive experience, the renewals are all happening on the app. Adds Amit, “20% of our users are truly just-in-time. For instance, a corporation which was shifting from location A to B, walked in to let their employees work from Awfis during the downtime of 10 days.’
As per him, the Lower Parel (Mumbai) centre, which opened last month, has seen 200+ walk-ins. Similarly, the South-Ex centre in Delhi, which opened in September, was running at 100% capacity in less than 4 months. Awfis currently has 7 centres operational in Mumbai, Delhi, and Bangalore. And any centre which is more than 3 months old is registering 100% occupancy, claims Amit. Consequently, on the anvil are about 50 more centres in NCR, Bangalore, Pune, Hyderabad, and Chennai. Simultaneously, it is continuing to expand its partnership base, which currently stands at 25 and is expected to grow to 200 in the next 90 days.
To support its aggressive growth plan the company has already invested $3 Mn last year, and has committed a total of $10 Mn investment to expand its business. Radha Kapoor, daughter of YES Bank’s CEO Rana Kapoor, is another investor in the venture, and has committed funds to the tune of $5 Mn in the venture.
While its plans are ambitious, Awfis will face competition from many such ventures which have mushroomed to leverage the growth in the startup ecosystem and the spread of the anywhere workplace trend. Bhive, Innov8, Qdesq, 91Springboard, Social Offline, and Regus are some of the many players in this space. The quality of the community, convenience, and ease of access are factors which determine capacity utilization at co-working spaces. Real estate costs weigh heavily on their success and in this regard, it will be interesting to see how does Awfis’s managed aggregation model works out in the long run.
But one thing is clear – our relationships with our workplaces are definitely changing and so are the formal definitions of it. It is heartening to note that given changing trends and urban challenges, corporates are also coming around to the fact that it’s just not sufficient to create one centre in an urban location and expect people from 50 km radius to congregate there for work. To incorporate the needs of young mothers or those with old parents at home, and for retaining best talent, they are also ready to take the leap to incorporate ‘work near from home programs’ if they are not entirely comfortable with work from home programmes. This shift in attitude augurs well with all the involved entities – the co-working spaces, people, startups, and for corporates.