Kickstart, a prominent co-working space in Pakistan, has successfully secured a Rs. 200 million investment from the Vital Group to fuel its expansive growth in central Karachi.
Founded in 2016 by LUMS alumni Saad Riaz, Khawaja Raza, and Hassan Shahid, Kickstart has been a leader in collaborative workspaces in Pakistan, currently managing 12 locations nationwide and serving over 3,000 members. The infusion of funds will facilitate a doubling of its space in Karachi to exceed 80,000 sq ft, with a total coverage of 200,000+ sq ft across 14 locations post-expansion.
In addition to the financial backing, Kickstart has introduced a novel business model, positioning itself as the property manager for landlords and adopting a revenue-sharing arrangement. This innovative approach aims to assist property owners in enhancing their rental yields. Traditionally, commercial real estate rental yields in Pakistan hover around 5%, requiring 20 years for owners to recoup their investment. Kickstart’s revenue-sharing model has the potential to elevate yields to 8-9%, thereby reducing the payback period by 40%, especially with additional investments in furnished assets, according to Khwaja Raza.
Kickstart’s flexible workspace solutions empower modern companies to efficiently manage large teams, facilitating quick scaling without significant capital expenditures. This is particularly advantageous in downtown Karachi, where quality office space is limited. The expanded co-working spaces cater to diverse communities, offering private offices for growing ventures, open seating for freelancers, meeting rooms, recording studios, skill-building workshops, and cultural event venues.
This expansion aligns with the global trend of growth in co-working spaces. In India, such spaces have witnessed substantial growth, reaching 680,000 seats and 43.4 million sq. ft by June 2022, projected to rise to 1,025,000 seats occupying 75 million sq. ft by 2025. Similarly, in North America, the co-working market size reached ~$4.6B in 2023, projected to reach $7.73B by 2028, growing at 11% annually.
