The East Village, Gramercy Park, or Fidi in New York City? The Design District, SoMa, or the Financial District in San Francisco? Fitzrovia in London, or Mitte in Berlin?
This may sound like a traveler’s bucket list, but it’s not. These are just some of the hyper-competitive office markets in which Knotel – one of today’s fastest-growing flexible office startups – currently operates.
What Does Knotel Do?
Knotel locates, designs, builds and operates customized office spaces for all types of business users, offering a flexible alternative to a traditional office lease and to the typical coworking office space.
The company removes the long-term office lease obligations found in the traditional landlord-tenant relationship, instead offering short-term leases of just three months. This allows businesses to invest in themselves instead of their landlord.
In less than three years Knotel has grown to occupy nearly 60 locations and 1 million square feet in New York, San Francisco, London, and Berlin. Business Insider named Knotel as one of the “Top 50 Startups” and “New York’s Hottest New Workspace Models”. Companies leasing Knotel office space include Starbucks, Microsoft, Stash, The Body Shop, and Teachable.
Who Is Knotel’s Competition?
With a current valuation of $500 million and just over 200 employees, Knotel is going head-to-head against established coworking office competitors such as IWG (formerly Regus), WeWork, Industrious, and Mindspace.
Despite the stiff competition Knotel has already become New York City’s third-largest operator of flexible office space, with plans to occupy close to 2 million square feet worldwide by the end of the year.
While Knotel’s service is different from a traditional office lease, it is also not really a coworking office space operator. In fact, the company’s website makes it clear that Knotel does not provide coworking spaces. Instead, they design, build, and operate private, customized, full-floor offices on flexible terms.
How Is Knotel Different from Coworking Space?
The coworking office space concept is based on the idea that like-minded individuals – solopreneurs, business start-ups, and creative divisions in big businesses – thrive from the synergy created by being around people similar to themselves.
For example, WeWork – valued at about $20 billion – thinks of itself as a community business. The company believes its members crave real-live companionship in today’s digital age, and provides amenities such as large lounges, adult dormitories, social events and summer camps.
By contrast, Knotel doesn’t focus on freelancers, doesn’t think of its users as ‘members’, and doesn’t rank companionship and community as a top priority. Instead, Knotel focuses on agility, believing that the traditional long-term office lease model simply does not work anymore for many companies.
Who Is Behind Knotel?
Knotel was founded by Amol Sarva, Edward Shenderovich, and Joseph Meyer in December of 2015. Sarva, the CEO of Knotel, has an extensive hands-on background in real estate and entrepreneurial business start-ups.
While studying for his Ph.D. at Stanford University, Sarva became a founding member of Virgin Mobile USA. After leaving Virgin he joined McKinsey & Company, then re-entered the entrepreneurial world by founding smartphone producer Peek while at the same time developing a 13-unit condo building in Long Island City with several partners.
With previous real-world success like this, Sarva and Knotel haven’t had trouble attracting investors. Since its official launch in 2016 Knotel has raised over $100 million in funding from established commercial real estate players and venture capital investors such as Newmark Knight Frank, Bloomberg Beta, The Wolfson Group, Invest AG, and Wainbridge Capital.
One Size and Look Doesn’t Fit All
Unlike its competitors, Knotel doesn’t spend a lot of time and money building out and decorating its office spaces so that all 59 locations have the exact same look and feel. This minimal build out approach allows tenants to move in quicker, with one company leasing more than 20,000 square feet of office space.
This approach attracts companies who want their office space to look like their own and like not a typical coworking office. Instead creating its own signature design style, Knotel helps develop the brand image of its individual users.
Knotel properties do include conference rooms, Wi-Fi, cabling, and some furniture. But every space looks different – which doesn’t bother large corporate users such as Starbucks and Microsoft.
Knotel At A Glance
Website: Knotel.com
Concept: Headquarters as a Service.
Benefit: Knotel’s trademarked Agile HQ platform allows business users of all shapes and sizes to benefit from the flexible alternative to a traditional long-term office lease.
Launched: 2016, currently has over 1 million square feet of flexible office space in 59 locations.
Markets:
New York City
- Brooklyn – 2 locations
- East Village – 1 location
- Fidi – 3 locations
- Flatiron – 12 locations
- Gramercy Park – 1 location
- Long Island City – 1 location
- Midtown East – 4 locations
- Midtown West – 8 locations
- Park Avenue South – 5 locations
- SoHo – 6 locations
- Union Square – 5 locations
San Francisco
- Design District – 1 location
- Financial District – 2 locations
- North Financial District – 1 locations
- SoMa – 3 locations
- South Park – 1 location
London
- Fitzrovia – 2 locations
Berlin
- Mitte – 1 location
Pricing: Subscription-based, including all of the costs in designing, building out, and servicing the office: branding, furniture, Wi-Fi, utilities, and cleaning with premium upgrade packages available.
