The co-working boom is in full swing in China. Again, the country’s tech history is repeating itself as capitalists are ready to dive in for supporting players, big and small, to buy into market shares.
MyDreamPlus, a co-working space operator that runs 16 locations in Beijing, just closed US$20 million B round led by Joy Capital to fuel nationwide expansion. The company has already secured a US$ 5 million series A at the end of 2015.
“Our OaaS (office-as-a-service) product has reached a point where we can take advantage and scale our space with it. The series B funding will be used in space expansion as well as to improve the office working experience. We also plan to spend money on talent and team building,” founder and managing director Bill Li said to TechNode.
The firm is looking at Beijing as the main expansion site with a goal to increase the density there. Now there are nearly 30,000 square meters of new spaces in the pipeline, all located at core commercial areas of the city. “Shanghai and Chengdu are also on our expansion agenda,” Li added.
The funding comes at a time when several major companies in the field are cashing up for a fight for China’s co-working space. Domestically, UrWork raised about US$ 58 million earlier this week, shortly after merging with rival New Space in April and scooping a similar size funding in January. Shanghai-based co-working space operator also booked B round to accelerate global expansion. In addition, their heavy-loaded US counterpart WeWork is also looking at the Chinese market.
With so many competitors moving in, the question for managers and operators of shared spaces has become “How to remain unique?” Operators, like URWork and SOHO3Q, have strengths in property resources with realtor background, while rivals, like naked Hub, may excel in their design and operation with hospitality expertise.
For the MyDreamPlus team, they believe workplace technology is their differentiator in the increasingly crowded market. Gone are the days when co-working spaces are defined by desks and polished spaces only, technology is going to be a crucial component of the shared spaces, according to Li.
In an attempt to fully adapt to Chinese users’ habits, MyDreamPlus’s OaaS system enables office users to control everything through WeChat. After registration on WeChat, most resources, including door admission, workstations, conference rooms, projection, printing, and photocopying, can be controlled while on-the-go. At the same time, the system makes it possible for the space operator to know about the traffic, facilities, and community of the space.
Given the technological support, MyDreamPlus has an efficient team for on-site operation. “Currently, we have one community manager on-site for 3,000 square meters space for all 16 locations,” Li noted.
That allows the company to allocate most of its team to product development. Of the 100-staff team, around 70% are engaged in three parts of core development: space design, R&D team, and community operation.
The occupancy rate of MyDreamPlus spaces is normally 95% after a 3 month start period, Li disclosed. The prices range from RMB 1800 to RMB 2200 depending on different locations, lower than WeWork’s China operations, on par with other domestic players.
With the quick boom in the shared working space, Bill Li believes the potential of this industry is huge. “Co-working industry is still taking a very small market share in the whole office market. The space operated by all co-working operators combined is around hundreds of thousands of square meters for now. But if you look at the office industry, that accounts for perhaps less than one percent of the whole traditional office space market. This means, we still have a long way to go.”