Fortune India Exclusive: BHIVE Workspace to close ₹400 crore pre-IPO funding by Jan 2025; targets ₹500 crore IPO by CY27: CEO Shesh Rao

BHIVE Workspace, a Bengaluru-based coworking operator, plans to close a ₹400 crore pre-IPO funding round by January 2025 and is targeting a public listing in calendar year 2027, founder and CEO Shesh Rao Paplikar said.

In an exclusive interaction with Fortune India, Paplikar said the company is in advanced stages of raising up to ₹400 crore as part of its ongoing pre-IPO round. The capital will be used to strengthen the balance sheet and support the next phase of national expansion.

The pre-IPO fundraise will comprise a mix of debt and equity, with around ₹100 crore expected to come in as equity at a pre-money valuation of ₹550 crore, taking the post-money valuation to about ₹650 crore, he said.

“The equity round has seen strong interest from high-net-worth individuals, family offices and several existing investors. This pre-IPO round represents a key milestone as BHIVE progresses toward its targeted IPO in 2027,” Paplikar said.

“This fundraise accelerates our journey towards an IPO while enabling rapid expansion into key growth markets such as Pune, Hyderabad and Chennai,” he added.

On its IPO plans, Paplikar said the company is targeting an issue size of around ₹500 crore, comprising both primary capital and an offer-for-sale component, with a projected pre-money valuation of ₹1,500–2,000 crore at the time of listing.

Access to capital remains critical for the company’s expansion plans, given the capital-intensive nature of the coworking business, Paplikar said. “For us, the IPO is not an exit. It’s the beginning of the next phase of growth, solving the single biggest constraint in this business—access to long-term capital,” he said.

Founded in 2014, BHIVE has scaled rapidly over the past four years, expanding its seating capacity from 2,500 seats in 2021 to around 32,000 seats currently, translating into a compound annual growth rate (CAGR) of nearly 150%. Paplikar attributed this growth to the company’s campus coworking model, which focuses on large-format properties offering extensive amenities such as sports facilities, landscaped gardens and community spaces.

BHIVE is currently operating at near-full capacity in Bengaluru and is planning further expansion within the city, while also preparing to enter new markets such as Pune, Hyderabad and Chennai. Several large properties are at advanced stages of negotiation, with additional announcements expected over the next month, Paplikar said.

Outlining the company’s project pipeline, Paplikar said BHIVE has recently signed a large project with Satwa on the Outer Ring Road in Bellandur, and launched properties including Century Towers and a location at Garuda Swagat Mall. He added that the company is close to finalising several major deals, including a 4 lakh sq ft building and a 2.5 lakh sq ft building, which are expected to be announced within the next 30 days once agreements are signed.

On the financial front, BHIVE has been profit-after-tax (PAT) positive for the past few years, reporting marginal profits of ₹4–5 crore. The company clocked revenue of about ₹200 crore in the previous financial year and expects revenue of ₹270–280 crore in the current year. Paplikar said Bhive is targeting ₹500 crore in revenue by FY28 and ₹1,000 crore by FY30, supported by already signed capacity that could take revenues beyond ₹350 crore, with new projects contributing meaningfully from FY28 onwards.

Segment-wise, managed offices account for about 65% of the company’s revenue, while coworking spaces contribute the remaining 35%. Nearly 55% of revenue comes from mid-sized clients occupying between 30 and 200 seats—a segment the company views as more stable and margin-accretive.

Managed office contracts usually have a two-year lock-in period, providing greater revenue visibility. Coworking contracts, in contrast, have an average tenure of 12 months, with renewal rates close to 80%, he said.