Indian rapid start-up market is driving demand for co-working spaces
After the first co-working offices hit India in 2013, the start-up scene in the country has begun to thrive with over 4,200 new technology companies recorded by the end of last year. India’s start-up scene is the third largest in the world, with a growth rate of 125% per year and $700m expected to be invested before February next year. The popularity of the co-working sector has increased as the need for cheap office space by the younger start-up generation has risen. Most shared offices cost under $100 per month, and have free perks such as networking events to entice start-ups to join.

Shared workspaces hit the Indian startup scene

NEW DELHI (AP) — Every weekend, the partiers flood into a New Delhi restaurant and dance club called Social, a three-story destination on the edge of Hauz Khas Village, one of the city's most popular nightlife neighborhoods.

After nightfall, the bar is busy and the dance floor is full. The lines regularly stretch out into the street. The dancing goes on until 1 a.m.

But just a few hours later, the watering hole will be clean, the tables will be cleared of silverware and plates and the nightclub will have been transformed into a cozy office where no one gets fired for drinking at work.

In this Aug. 19, 2016 photo, young Indian entrepreneurs and freelancers work inside Innov8, a lax co-working space in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. With more than 4,200 new tech-based companies by the end of last year, India has become the third largest market for startups, according to The National Association of Software and Services Companies (NASSCOM), an Indian software industry research company. (AP Photo/Altaf Qadri)

Everyone shares desks at Social: photographers, designers, journalists, software programmers. They bounce ideas off one another, hire one another and collaborate to expand their businesses. Everyone is either a freelancer or working for a small startup.

As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchical to relaxed and bar-like.

"It's the millennial personality," says 29-year-old Dinsa Sachan, a freelance journalist who works out of Social. "People don't want to bow down to random bosses in their offices. They are seeking more meaningful work. So, I think co-working spaces are like a melting pot for individuals like these."

The first co-working offices began springing up in India about three years ago. Today, there are at least a dozen in New Delhi — though Social is the only one that also functions as a restaurant — with similar numbers in Mumbai, Bangalore and Hyderabad, where most Indian startups are based.

With more than 4,200 new technology companies, mostly phone apps or websites, by the end of last year, India now has the third-largest startup industry in the world, behind the United States and United Kingdom, according to The National Association of Software and Services Companies, or NASSCOM, an Indian industry research company.

Foreign-based investors are opening their coffers, and now comprise most of the money being pumped into Indian startups, NASSCOM says. Funding for Indian startups is growing at more than 125 percent a year, with an additional $700 million estimated to be invested before February 2017, according to a 2016 report by InnoVen Capital, an Asian venture capital firm.

Riyaaz Amlani, the owner of Social and a powerful force in the changing Indian restaurant scene, said he noticed a demand for cheap office space in prime New Delhi locations and decided on a fluid concept for his restaurants. There are now 14 Social outlets across India, all of them also co-working spaces.

"Increasingly, offices started becoming more like cafes, right? Google, Yahoo, Facebook, Twitter," the 41-year-old says. "If you get into a traditional office environment, you know, it's all very cut-and-dried. It's all very hierarchal. Your importance is measured by the amount of square-foot" your office has.

The co-working spaces are also very young places.

Most Indian startups are created by people under age 28 who often cannot afford skyrocketing rents in big-city office districts.

Membership fees at most Indian shared offices are usually less than $100 per month. They also come with free access to networking events, investors' conferences and even parties. At Social, members also get lockers, free internet and can redeem their monthly fees for food and drinks.

Rishi Jalan, a 25-year-old who started a sports management company for student athletes two years ago, said the free flow of ideas and inspiration is one of the top reasons people choose to work at a shared office space.

"I know so many of my friends who actually went to a co-working space and found their co-founders," says the Cornell University graduate. "Everyone, I feel, in these kind of co-working spaces in Delhi, is a guy who's motivated. Firstly, because you have to do that if you're an entrepreneur. And secondly, they're all ready to share their ideas."

Like Jalan, many young Indians are moving away from traditional low-paying, entry-level jobs and want to do something of their own.

"In my day, we didn't have this opportunity available to us," says Amlani, the Social owner. "Our heroes were rebels and rock-and-rollers, and the millennials' heroes are people like Mark Zuckerberg, and Elon Musk, and people who want to change the world with an app," he said. "They're blazing their own trail. And that's amazing. And we're just happy to facilitate it in a very small way."

In this Aug. 19, 2016 photo, young Indian entrepreneurs and freelancers work at Innov8, a lax co-working space in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. With more than 4,200 new tech-based companies by the end of last year, India has become the third largest market for startups, according to The National Association of Software and Services Companies (NASSCOM), an Indian software industry research company. (AP Photo/Altaf Qadri)

In this Aug. 19, 2016 photo, young Indian entrepreneurs and freelancers work inside Innov8 a lax co-working space in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. What makes these shared office spaces even more lucrative, is the rent. Most startups in india are created by people under the age of 28, who can¿t always afford skyrocketing rent prices in New Delhi¿s office districts. (AP Photo/Altaf Qadri)

In this Aug. 19, 2016 photo, an Indian entrepreneur works on his laptop at Innov8, a lax co-working space in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. What makes these shared office spaces even more lucrative, is the rent. Most startups in india are created by people under the age of 28, who can¿t always afford skyrocketing rent prices in New Delhi¿s office districts. (AP Photo/Altaf Qadri)

In this Aug. 30, 2016 photo, an Indian entrepreneur, left, works at Social Offline, a bar cum cafe with a lax co-working space, in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. What makes these shared office spaces even more lucrative, is the rent. Most startups in india are created by people under the age of 28, who can¿t always afford skyrocketing rent prices in New Delhi¿s office districts. (AP Photo/Altaf Qadri)

In this Aug. 30, 2016 photo, an Indian entrepreneur, left, works at Social Offline, a bar cum cafe with a lax co-working space, in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. What makes these shared office spaces even more lucrative, is the rent. Most startups in india are created by people under the age of 28, who can¿t always afford skyrocketing rent prices in New Delhi¿s office districts. (AP Photo/Altaf Qadri)

In this Aug. 30, 2016 photo, an Indian Disc Jockey plays music while entrepreneurs and freelancers work at Social Offline, a bar cum cafe with a lax co-working space, in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. What makes these shared office spaces even more lucrative, is the rent. Most startups in india are created by people under the age of 28, who can¿t always afford skyrocketing rent prices in New Delhi¿s office districts. (AP Photo/Altaf Qadri)

In this Aug. 30, 2016 photo, members having beer at Social Offline, a bar cum cafe which has a lax co-working space as well, in New Delhi, India. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. What makes these shared office spaces even more lucrative, is the rent. Most startups in india are created by people under the age of 28, who can¿t always afford skyrocketing rent prices in New Delhi¿s office districts. (AP Photo/Altaf Qadri)

In this Sept. 10, 2016 photo, Indians dine at Social, a three-story destination on the edge of Hauz Khas Village, one of the most popular nightlife neighborhoods in New Delhi, India. However, after a night of thrills and spills, this watering-hole will be cleaned, rearranged, and transformed, into a cozy office where no one gets fired for drinking at work. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. (AP Photo/Altaf Qadri)

In this Sept. 10, 2016 photo, diners stand on the terrace for a smoke at Social, a three-story destination on the edge of Hauz Khas Village, one of the most popular nightlife neighborhoods in New Delhi, India. However, after a night of thrills and spills, this watering-hole will be cleaned, rearranged, and transformed, into a cozy office where no one gets fired for drinking at work. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. (AP Photo/Altaf Qadri)

In this Sept. 10, 2016 photo, people dance at Social, a three-story destination on the edge of Hauz Khas Village, one of the most popular nightlife neighborhoods in New Delhi, India. However, after a night of thrills and spills, this watering-hole will be cleaned, rearranged, and transformed, into a cozy office where no one gets fired for drinking at work. As India emerges as one of the biggest markets in the world for tech-based startups, workspaces are transforming from traditional and hierarchal, to relaxed and bar-like. (AP Photo/Altaf Qadri)