Kickstart, a Pakistani co-working space, has successfully raised Rs. 200 million from Vital Group.
This investment is earmarked for the expansive growth of the company’s presence across central Karachi.
With the latest partnership, Kickstart will double its area in Karachi to more than 80,000 sq ft. Founded in 2016 by LUMS alumni Saad Riaz, Khawaja Raza, and Hassan Shahid, Kickstart has been the pioneer of collaborative workspaces in Pakistan. The company currently manages 12 locations across the country and serves more than 3,000 members. After the expansion, its total coverage will increase to 200,000+ sq ft. across 14 locations.
Moreover, the company has rolled out a new business model where it will serve as the property manager for landlords and operate on a revenue-sharing basis with them. “Kickstart has been building and operating premium commercial real estate for 8 years and has built a reputable brand through which property owners can improve their rental yields,” said Khwaja Raza.
He added, “Traditionally, the rental yield on commercial real estate has been around 5% in Pakistan, which means the owner takes 20 years to recover their investment. With our revenue sharing model, where Kickstart comes in as a specialist operator, the yields can go up to 8-9% with some additional investments in furnished assets and reduce the payback period by 40%”.
Kickstart’s flexible workspace arrangements let new-age companies manage their large teams effectively by scaling up quickly without thinking about heavy capital expenditures based on their future needs. In downtown Karachi, where quality office space is a scarce resource, Kickstart equips organizations to provide their employees with state-of-the-art facilities in a flexible manner without any operational trouble.
The expanded co-working spaces are designed to serve diverse communities, offering private offices for growing ventures, open seating for freelancers, meeting rooms, recording studios, skill-building workshops, and cultural event venues.
Kickstart’s expansion is consistent with the global surge in coworking spaces. Across the top seven cities in India, coworking spaces have seen a substantial rise, growing to 680,000 seats and 43.4 million sq. ft by June 2022, up from 471,782 seats and over 30 million sq. ft in 2019.
By 2025, these figures are projected to rise to 1,025,000 seats occupying 75 million sq. ft. In these cities, the share of coworking spaces in the total absorption of office space has risen to 27% in Q1 2023, up from just 14 percent in Q1 2019. Similarly, in North America, the coworking market size reached ~$4.6B in 2023 and is projected to reach $7.73B by 2028, growing at 11% annually.
