Knotel CEO defends against critics and promises profitability

Amol Sarva, the CEO of coworking space provider, Knotel, has shot back at critics about the performance of its New York arm and says that "profitability is very much in sight" for the company.

Recently, it was reported in the US that Knotel had laid off a number of people in New York in the face of high vacancy rates and a drop in leasing activity in the city.

In a recent conference call with journalists, Sarva sought to allay concerns about the departures.

“24 folks left our New York team but 10 joined,” he said. “Our payroll will be the same in February as it was in December.”

He also gave a rare look at some of the company’s financial metrics. Contracted annual revenue had jumped from $100 million a year ago to $350 million, he said.

Sarva didn’t disclose details of the group’s bottom line but said “profitability is very much in sight” and the business expected to be “cash flow break-even” this year.

In London, where Knotel launched in April 2018 and has since grown its footprint to 470,000 sq ft, the business was on track to be cash flow break-even in the first half of this year, he added.

The group’s expansion has been fueled by a $400 million funding round last year that gave the flexible office provider ‘unicorn’ status.

It added 1.1m sq ft of space to its portfolio in the second half of 2019, helping take the company’s total footprint to more than 5m sq ft.

Read more here