The Shift Towards Coworking Model
Businesses are increasingly preferring coworking spaces over conventional office setups. Companies that foresee a near-future change in headcount see an even bigger value in joining a coworking space. The coworking model offers the flexibility to increase or decrease the number of desks you rent. You only pay for the number of desks you have at any given moment. This is in contrast to the conventional model, where you will have to plan in advance and lease and build an office, keeping in view your needs for the next 18 – 24 months, at least.
Reacon Group: A Case in Flexibility
Let’s take a look at the Reacon Group, one of our members at Kickstart in Lahore. Reacon Group, based in Sydney, Australia, is a marketing solutions firm specialising in content creation, distribution, data-driven communications, and strategic partnerships. Four years ago, they established a back-end office in Pakistan.
Overcoming Traditional Office Limitations
Reacon Group started with a small team of three (3) employees with plans to increase their headcount. Their further staffing needs depended on the clients they planned to onboard in near-future.
Opting for a traditional office setup required them to forecast their workforce requirement for at least two (2) years, a predict-and-plan model severely restricting their expansion plans.
Strategic Expansion with Coworking Spaces
In 2020, Reacon Group acquired an office for six (6) people. In the following years, 2021 and 2022, they expanded their office by adding space for four (4) more people each year, bringing their total team in Pakistan to fourteen (14). Reacon Group recognised the flexibility and convenience of growing their team in a coworking space and made it a part of their expansion model. The elimination of administrative hassle at Kickstart further enhanced their experience.
“We have a lean team in Pakistan, so if we had our own office, I would have to do additional hiring and worry about so many administrative tasks. Being here at Kickstart relieves me from all that so I can focus on our core business” added Hyder Ali Afzal, who is Head of Technology Services at Reacon Group.
In 2023, Reacon Group completed a major acquisition that expanded their global team from thirty-five (35) to a hundred (100) employees. This expansion nearly doubled their team in Pakistan. With the addition of another eight (8) desks, the team at Kickstart grew to twenty-two (22) employees. This growth provided a solid foundation and brought them to a defining moment: deciding whether to continue in a coworking space or move to their own office.
“About six months ago, we considered setting up our own office. I ran the numbers, and looking at the capital and operational costs, it became clear. Spending all that money didn’t make sense when we already had everything we needed right here.”, Hyder explained.
The Ongoing Coworking Connection
Reacon Group has now acquired another company, with the merger set to take place in March 2023. They have already aquired four (4) additional desks at our location, and as the merger runs to completion, they will be increasing their headcount further.
When asked about the decision to continue this partnership, Hyder explained, “We’ve explored other options in the past but maintaining a high-end corporate office appearance is crucial for us. It’s an extension of our offices in Melbourne and Sydney, so the interior, design, and furniture must be top-notch. Our global head visited Pakistan six months ago, and although we considered some options, he insists our office should be in the city’s main business hub. Here [at Kickstart], both of these requirements are being fulfilled.”
Flexibility of Coworking Model for Cost-Efficient Expansion
The coworking model line remains consistently lower than the traditional office line, highlighting the ongoing cost benefits. The space between the two lines represents not just physical seats but the tangible financial advantage of choosing a coworking space—a flexible, cost-effective solution for a company’s evolving space requirements.
Reacon Group’s use of coworking spaces tells a compelling story of strategic growth and cost management. Starting in 2020, with three (3) employees, Reacon’s team in Pakistan has expanded to twenty-six (26) employees, steadily increasing the desks they acquired at Kickstart. This approach is in contrast with the traditional office model, where committing to a space suitable for future expansion leads to paying for unused space.
In their growth journey, Reacon Group acquired two new companies in 2023 and 2024, which resulted in the need for twelve (12) additional desks to date and more to be added as the merger is finalised in March 2024. In a traditional office setup, an expansion of this magnitude requires prior planning, significant financial investment, and administrative hassle—scouting and securing a new office, setting it up, and hiring additional administrative staff to manage the increased space. In contrast, the coworking model allowed Reacon Group to continue renting only the number of desks they needed without such overheads and administrative hassles.
