Flexible office space provider Victory Offices has begun trading on the ASX up nearly 10 per cent from its initial offering price as investors look to profit from the coworking trend.
Victory shares were trading for $2.19 at 1200 AEST, an hour after they began trading under the symbol VOL.
"It's been well received today, which is always pleasing," chief financial officer Geoff Hollis told AAP.
The company raised $30 million in an initial public offering underwritten by Ord Minnett, selling 15 million shares at $2 a share.
Founded in 2013, Victory doesn't own any premises but has 21 long-term leases across high-quality buildings - 16 in Melbourne, four Sydney and one in both Brisbane and Perth.
It had 1,662 customers it describes as a mix of individuals, small businesses, startups and big corporations in industries such as finance, legal and recruitment, technology and consulting.
Its occupancy was at 89 per cent as of June 11.
Victory is forecasting making $45 million in revenue and $9.3 million in profit in the 12 months to June 30, up from $29.4 million in revenue and $5.4 million in profit in last fiscal year.
At $2.19 a share it has a market capitalisation of $89.6 million.
Victory doesn't plan to pay a dividend as it focuses on growth.
It competes with the four other prominent providers in the Australian flexible workspace market: Regus, Servcorp, WeWork and the Executive Centre.
Regus has more than half the market, with 83 locations.
Victory says that by 2030, 30 per cent of commercial office space will be defined as flexible.
"Like the millennials they employ, organisations are increasingly wanting more flexibility and cost efficiencies," Victory said in its prospectus.
Compared to a commercial lease that would take six months to secure, a business can typically source a flexible office space in just 23 days and move in 14 days later, according to Victory.
And while a commercial leases generally last three to 10 years, the average coworking lease is for 7.3 months, with 19 per cent of the leases month-to-month.
Two of Victory's locations, in Melbourne and North Sydney, were recently acquired and have yet to open.
Victory says when its St Kilda Road spot in Melbourne opens in August it will be its largest location, an entire three-storey building with 3,000 square metres of space.
Mr Hollis said the company plans to have 27 locations by the end of fiscal 2020 across Australia's eastern seaboard.
Former Victorian premier Steve Bracks serves as chairman of Victory's board of directors.