With office space becoming a rare commodity, sharing office spaces in Maximum City is the new in-thing
Not many would argue the assertion that Mumbai is usually an entrepreneur’s first port of call within India despite its shoddy infrastructure, poor wages and astronomical rental rates.
The ‘city that never sleeps’ has many pluses too: a readily available network of resources, target groups aplenty, access to capital and possibility that the eternal dream of many Mumbaikars to be a millionaire may indeed be attainable. Mumbai even featured among the world’s best 26 cities for business opportunity, livability and innovation in a Price water house Coopers’ survey last year.
Yet, the first seemingly insurmountable battle for a startup entrepreneur in Mumbai is the issue of lack of space and sky-scraping cost of renting even an unfurnished office space not to speak of actually owning and operating a business from a self-owned office space.
And if you’re incorporating your company, you’ll need to provide the Registrar of Companies (RoCs) with an address. But despair not! If you absolutely need a physical space to operate from, then consider coworking hubs or co-working spaces. The co-working spaces or shared working environments feature all the niceties that you would find in a traditional office setup such as a reception area, conference rooms, and tea/coffee paraphernalia.
Co-working spaces are quite big and a common practice in the US and Europe, and a seat could cost somewhere around plus $100. The concept of co-working has caught up quickly in India, especially in Mumbai where it is becoming a huge rage. There’s a huge demand for co-working spaces already from freelancers, independent consultants, and stockbrokers who need a small space to work in without any distractions.
Co-working spaces are actually ideal for writers, graphic designers, entrepreneurs, budding startups with 2 to 10 member teams, or even for big organisations looking for remote offices. These co-working spaces are also called plug and- play offices as they provide an alternative to independent professionals who want to avoid coffee shops and cafes.
As it is, the rent for a small office in Andheri,of around 400sqft, ranges from`30,000 to 50,000 per month, and it is very hard to rent offices that are smaller than 400 sq ft. For a startup with a team size of 3 to 5, a 120 sq ft office is more than enough. If you do the mathematics, a startup with four people would have to pay only`20,000toaco-working space.
Now, when you rent an office, there are several other costs. Here is a small comparison for rental and co-working:
So additional costs easily go up to 12,000 and more. This means it would cost a startup `40,000 every month for the office. In addition, when renting a space, a deposit and brokerage fees if applicable are also to be considered. For co-working spaces, there are no such costs involved. The maintenance is taken care of by co-space hub. It’s no big deal cleaning up the office, but just imagine a busy day when targets have to be achieved and deliveries have to done? Not surprisingly, co-working is turning out to be quite popular in Mumbai, as it is enabling startups and independent professionals to save time and money.
“Co-working spaces have been gaining a lot of popularity in Mumbai. Not only are startups using it, independent consultants such as stock brokers and graphic designers are using it too. Nearly 65 per cent of our seats are used by freelancers and stock brokers. These independent co-workers find our Mumbai co-working spaces useful to connect with their peers and gain more insights. But what really attracts people to this concept is the quick activation”, says Waqar Azmi of SumHR, a software startup in Andheri, explaining the popularity of co-working spaces.
Azmi’s SumHR started letting out workspaces to startups some two years ago. Each workspace costs `5,000 a month and also offers a plethora of features.
Co-working spaces are quite big and a common practice in the US and Europe, and a seat could cost somewhere around plus $100.
Co-working spaces are actually ideal for writers, graphic designers, entrepreneurs, budding startups with 2 to 10 member teams, or even for big organisations looking for remote offices.
“We take care of the workers so that they can take care of their clients. We do not say all this without proof. From the time we started letting out our premises for co-working, people have used our co-working spaces. At present, there are many tech startup teams, stockbrokers, designers and individuals, who are using our spaces”, adds Azmi.
A person can just pay and start doing his or her work. There is no need to arrange for basic needs like furniture, internet, pantry, cleaning, etc. There are no hassles whatsoever, just pay and start and even use it as a business address!
Another reason why plug-and-play offices are becoming popular is because of the affordability. `5,000 in Andheri is a relatively low amount compared to the commercial rates going in the area.
“Every day, we get multiple enquiries from people. In fact, we doubled our capacity earlier this year and the response has been amazing. Co-working spaces are the future, especially in cities like Mumbai where the real estate is very costly for budding entrepreneurs,” says Azmi.
Sum HR which is itself a start-up has three offices on two different floors in the building, the total area being more than 4,000 sq ft. Co-working spaces are usually measured by the number of people that can be seated. Around 100 can easily sit in these spaces.
The workstations are your usual 2×3 feet but also provide soft-boards and electricity and internet connections, a value addition that is usually rare in India. There is a simple signup process. You just have to pay the rent for one quarter along with a deposit. In case, you want to discontinue, just give a month’s notice, and get back the refund for the unused month.
Bombay Connect, for example, not only provides desks for rent along with wi-fi, access to a conference room, library plus courier and business center services — for as little as `1,250 a month, but also access to a network of entrepreneurs and professionals who give talks, workshops, and offer advice and help for free.
Elise Foster Vander Elst, who started her arts consultancy business last year and has since been operating out of Bombay Connect’s Bandra space, says it suits her business which does not require much space.
Milind Doshi, chief executive officer (CEO), Zenith Society says that though the concept is new, it has been gaining phenomenal popularity. He says his co-working space is a luxurious modern air-conditioned office designed by Sandeep Dave, a renowned interior designer.
Doshi says entrepreneurs and small scale industrialists who wish to make it big in Mumbai prefer the shared spaces. It is but natural that a wannabe entrepreneur would like to enjoy all the amenities without having to maintain a full-fledged office costing astronomical sum when you can get all the amenities for a fraction of a sum.
The plug-and-play offices lack nothing. There are fully equipped board and conference rooms with projectors and conference calling facilities, meeting rooms, unlimited free super-fast Wi-Fi, unlimited free excellent coffee, access to a microwave and fully equipped
kitchen, office receptionist, two very clean and amazing smelling bathrooms, access to a safe and locker, access to errand boys and interns, bed for power naps, background productivity music in the office, access to a car and driver for meetings, prestigious office address and mail handling services.
How do builders and developers who are into building commercial spaces react to this new phenomenon? Says Nilesh Shah of Shah Builders: “I look upon it as a business opportunity. Though such cubicle commercial spaces hold no candle to the full-fledged offices, this concept is a bang-on. It would trigger massive entrepreneurial activities, and help the growth of business and industry. We will study this concept in-depth and come out with our own solutions.”
Ratan Chjabria, CEO of Chhabria developers says, “Such offices are catering to small time entrepreneurs but when they grow up, they will certainly like to have their own offices. Nobody would like to operate out of an office which shares space with several others for ever”.
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