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Community calling – Can the trend of coworking spaces take off?

Published in Nov-Dec 2015

In profile – The HeadQuarters, DotZero, CoPakistan and Basecamp.

In essence coworking spaces are membership-based workspaces where groups of freelancers, remote workers, startups and independent professionals can work together in a shared, communal setting. In the past few years, multiple local coworking spaces have been established and while each space has its unique set-up, vision and positioning, their common purpose is to provide a platform conducive to community building and networking.

The HeadQuarters and Suite 401
The HeadQuarters (The HQ), based in Karachi, was founded by serial entrepreneur Faizan Laghari in 2014. The premise is a 2,000 square feet area, with total desk space for 12 people. It offers standard coworking facilities such as backup power, high-speed Wi-Fi, and an office friendly infrastructure.

It is worth noting that in 2008 Laghari launched Pakistan’s first coworking space called Suite 401 in Karachi – but in 2010, he had to wrap it up because according to Laghari “it was way ahead of its time. Most people had no concept of coworking; they wanted fixed square feet for themselves and partitions for privacy. They were also extremely wary about sharing ideas – ‘koi hamara idea to chori nahi kar layga?’ was a sentence I often heard.”

However, over the past few years, due to greater acceptance of entrepreneurship and thanks to initiatives from PITB, PASHA and overseas Pakistanis returning to launch their own startups, the mindset of a ‘workspace community’ has started to take hold. People have realised that in a coworking space, they will not only save overhead costs such as utility bills; they will also find likeminded people to help them execute their idea by bringing in a different set of skills.

The HQ charges Rs 15,000 per person per month for a six-day (9:00 am to 8:00 pm) work period and attracts people from various backgrounds, such as software developers, graphic designers, small startups, writers and consultants.

Having learnt from his previous venture, Laghari discourages day passes because it can be difficult to accommodate people at short notice and also because of security concerns.

“At Suite 401 we once had a ‘company’ conduct interviews, take money from each candidate, and then disappear the next day. Luckily we didn’t get in a serious fix because of our reputation.”

Laghari adds that such spaces are not lucrative; in fact in monetary terms you are considered successful if you manage to break even.

“I am doing this because I want to give back to the community, and I have other startups from which I earn.”

He says maintenance costs are very high, especially when there is no guarantee that one will retain a minimum number of people every month.

“People come and go – merely filling up the space defeats the purpose of ‘an organic community’ anyway.”

Laghari says he might expand to Lahore in 2016, and although he mentors aspiring entrepreneurs at various occasions, he has no plans to include a formal incubation centre at the HQ.

Coworking space at DotZero
DotZero, based in Karachi, was set up in 2013. It was founded by four tech entrepreneurs; Imran Moinuddin, Founder and CEO of NexDegree, Farzal Dojki, Founder/CEO of Next Generation Innovation, Yusuf Jan, Founder of Mixit Technologies, and Atif Azim Co-Founder and CEO, VentureDrive.

According to Moinuddin, “the objective is to create a platform to support entrepreneurs and startups in terms of mentoring, networking opportunities and incubation facilities.”

Dojki adds that DotZero aims to “foster a culture of innovation and providing a coworking space is only a part (albeit an important one) of the journey and a means to an end.”

In terms of coworking facilities, DotZero accommodates about 125 people at any one time. The service mainly targets small startups and individuals are hardly ever inducted. What gives DotZero a distinct advantage is the talent and networking opportunities it attracts, mainly because of the founders’ strong connections in the tech industry. According to Dojki “you can meet 10 to 15 CEOs every day and this leads to the kind of access to resources, collaboration and insight not easily found elsewhere.”

Moinuddin says that before induction, startups are assessed by a programme manager and/or the founders in order to gauge whether they have the potential and drive. If they qualify, the space is rented to them, regardless of whether they can pay the full rent or not. In fact, some start off without paying any rent and start paying gradually as they make a profit.

The space can be rented on a daily or monthly basis. A day pass (hardly taken up) costs Rs 1,000; while the monthly cost (shift: 9:00 am to 8:00 pm) ranges from Rs 4,000 to Rs 12,000 (depending on the discounts given). It is also possible to rent a separate room, the monthly cost of which is Rs 6,000 to Rs 15,000 (depending on the size of the allotted room and any discounts given).

Dojki says that to a large extent he and Moinuddin assume the burden of the costs, although an alternative source of revenue also comes from renting a dedicated space to NGOs and other tech-oriented companies for their events.

For Dojki and Moinuddin the ROI is not monetary or short term, rather it comes from collaboration, networking and promoting entrepreneurship, which is in fact why they launched ‘DotZero Ventures’ a couple of months back. DotZero Ventures will serve as a funding resource for tech-based startups (based in their coworking space) which have achieved relative success, but want to expand further.

CoPakistan was started by Adnan Yusuf, Khizra Munir and Rizwan Malik (they had all worked together at Interflow) in September 2015 in Karachi.

Unlike DotZero which caters to a tech-based audience, CoPakistan, according to Khizra Munir is “for individual freelancers and small businesses looking for a creative and inspiring environment. People who want the casual feel of a café, but still want to have access to office-related facilities.”

Breaking away from cubicle style and individual desk setting, CoPakistan has beanbags, shared table space, and even a tiny ‘loft’ with a bed where people can take a “power nap”. CoPakistan’s strategy to build a “casual café-like environment” has a business purpose as well as the founders are also the owners of Sattar Buksh (it is also located on top of the café).

According to Yusuf, “we already had a 2,000 square feet worth of space available, and we decided to set it up as a coworking space.”

"The monthly charges per person (non-corporate) are Rs 10,000 for a work day of 9:00 am to 12: 00 am. Also available is a customised menu of food available at subsidised rates. The charges for corporate entities are double."

CoPakistan has plans to conduct events on the weekends (and attract traffic to Sattar Buksh as well).

CoPakistan plans to expand to Lahore and Islamabad, given that Lahore has a massive startup culture, and in Islamabad, there is plenty of contractual employment.

“Karachi was almost a pilot run for us; we plan to have much bigger spaces in Lahore and Islamabad,” says Munir.

In July 2013, four friends, Bilal Ahmad, Faisal Khan, Salman Ahmad and Muhammad Uzair launched a company called Peshawar 2.0 with the aim of fostering entrepreneurship, generate employment and provide young people with a platform for their ideas. As part of Peshawar 2.0, a coworking space called Basecamp was established in December 2013, with the objective of providing individuals and small startups an inexpensive, yet fully equipped office structure.

Basecamp can accommodate up to 30 members at a time. For startups and individuals, Basecamp charges Rs 6,000 per person monthly. In case of students (even if they are earning), the monthly charges are Rs 3,000. The premises are open six days a week – 9:00 am to 9:00 pm from Monday to Friday and 9:00 am to 5:00 pm on Saturdays. Corporate entities are charged Rs 12,000 monthly.

According to Uzair, “we hope to attract young people not only from Peshawar, but also from other parts of Khyber Pakhtunkhwa – hence the reasonable rates.”

He adds that the philosophy of their coworking space can be found in the name ‘basecamp’. “People come to nurture their ideas and when they expand – or are ready to make their uphill journey – they then move into their own offices.”

Revenue is generated mainly through events, such as technology-oriented conferences, motivational talks, startup launches etc. An event cost is Rs 10,000 per day.

Basecamp now plans to establish an incubation centre called ‘Revolt’ and to this end they have approached the Peshawar Chamber of Commerce for funding as well as overseas Pakistanis.

“Overseas Peshawar-based techies are very interested in investing in local talent; they feel it’s their city calling, and they need to give back,”says Uzair.