InstaOffice, a start-up that offers managed office space on a sharing basis, said on Monday it raised an undisclosed pre-Series A round led by Globevestor, a California, US-based venture capital firm that has backed car-rental service Zoomcar, education portal OnlineTyari and lending platform Rubique.
Angel investors including Toppr co-founder Zishaan Hayath, Karan Chellani, managing partner at SQUE Capital, and Mohit Satyanand, chairman of Teamwork Arts, participated in the round.
This is the first external funding raised by the Gurgaon-based company that completes with Awfis, 91springboard and a number of smaller start-ups in the area of co-working space.
Proceeds from the funding round will go into taking over more properties, expanding the workforce and conducting customer-centric events, a means of engagement for its user community that the company sees as a differentiator, said co-founder Vikas Lakhani in a telephone interview.
InstaOffice takes large office spaces on lease and offers it on per-desk per-month basis for a pre-defined period of use. The tariffs range from Rs7,000-12,000 per seat per month. There are also customizable plans for clients who require the space for a shorter duration or require only a specific area like the boardroom or private cabins.
InstaOffice was founded in October 2015 and opened its first property in February last year. It was started by Lakhani and Devendra Agrawal, old-time friends from Jaipur. Both the co-founders invested an initial corpus of Rs40 lakh to start the venture.
Starting with a little over 3,000 square feet of office space under management, InstaOffice has grown to around 50,000 sq ft in less than a year.
Currently, the company operates six properties (four in Gurgaon and two in Bengaluru) and five more are coming up in the National Capital Region, said Lakhani. It lists the inventory as a mix of private offices, cabins, open workstations and meeting rooms.
“The existing properties are 4,000-6,000 sq. ft. in size and have about 60-100 seating capacity each. The new properties we will add are much larger.” According to Lakhani, beside early stage start-ups, InstaOffice also targets large corporate entities. It counts Dr Reddy’s, Amazon India, Staples and Yahoo among its clients.
The company works on a revenue-share model with the owner of the property, with which InstaOffice has a long-term exclusive lease agreement.
“The demand dynamics of office spaces have considerably changed, resulting in high vacancy in commercial real estate. We not only have created net positive absorption in multiple markets, but have also allowed our landlord partners to earn superior rental yields than traditional lease rentals,” said Lakhani.