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Brooklyn-based Industrious has raised $80M in a Series C funding round, the co-working company announced Tuesday.
Riverwood Capital and Fifth Wall Ventures led the round, and the firm’s total venture capital funding is now at $142M. The capital injection will go toward launching more spaces, providing additional services to clients and data collection, Industrious CEO Jamie Hodari said.
The company is now in 25 cities, and plans to expand to 50 or 60 locations by the end of 2018.
“One-third of the growth will be adding more cities to the network, and two-thirds will be for additional locations for cities we are already in,” Hodari said.
The firm has two New York City operations, and opened its first Manhattan location at SL Green's 215 Park Ave. South in 2016. It has plans to expand to Bryant Park, Lower Manhattan (from Flatiron down to SoHo) and parts of “brownstone Brooklyn,” meaning areas south of the Brooklyn-Queens Expressway.
“New York is a completely different beast than the rest of the country,” Hodari said. “In most American cities we would be happy with six or seven locations … As WeWork has shown, in New York you can have 40.”
Industrious also has five locations in Atlanta, three in Los Angeles and three in Chicago.
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Hodari founded Industrious with company President Justin Stewart in 2013. Last year, the firm raised $25M in a Series B funding round and acquired PivotDesk, an online marketplace for short-term office rentals.
Hodari said that the firm is increasingly reaching financial arrangements more commonly seen in the hotel industry. In the past, he said, Industrious would sign a lease with a landlord and pay for the build-out.
“We’re in the middle of a transformation,” he said. “This is the year that I can say unequivocally that every landlord has said, ‘I need to get smart about co-working and I need to pick a partner.’”
Industrious is pursuing a model in which it would enter into an operating agreement with an office landlord and earn a share of the rental revenue. The model gives Industrious greater flexibility and differentiates it from the giant in its sector, WeWork.
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