WeWork

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WeWork Companies Inc.
Private
Founded 2010; 8 years ago (2010)
Founders Adam Neumann
Miguel McKelvey
Headquarters New York City, New York, U.S.
Number of locations
270[1] (2017)
Areas served
90 cities
Key people
Adam Neumann
(Co-founder and CEO)
Miguel McKelvey
(Co-founder and CCO)
Products Workspace for startups, small businesses, freelancers and entrepreneurs
Brands WeWork, WeWork Labs, WeLive, Rise by We, WeGrow
Services Shared workspaces and related services for entrepreneurs
Owners Adam Neumann
Miguel Mckelvey
Number of employees
2,000
Subsidiaries Flatiron School
Meetup
Website wework.com

WeWork is an American company that provides shared workspaces for technology startup subculture communities, and services for entrepreneurs, freelancers, startups, small businesses and large enterprises. Founded in 2010, it is headquartered in New York City.[2] As of July 2017, WeWork had a valuation of roughly US$20 billion and managed 10,000,000 square feet (930,000 m2) of office space.[3][4]

WeWork designs and builds physical and virtual[5] shared spaces and office services for entrepreneurs and companies.[6] The company’s 100,000+ members have access to health insurance, an internal social network, social events and workshops, and an annual summer retreat.[7][8][9] WeWork has more than 5,000 employees in over 280 locations, spread across 77 cities in 23 countries including Australia, Argentina, Brazil, Canada, China, Colombia, France, Germany, Hong Kong, Ireland, India, Israel, Japan, Mexico, Netherlands, Peru, Singapore, South Korea, Spain and United Kingdom.[7][10][11]

History and funding[edit]

The kitchen area at a WeWork space in New York

In May 2008, Adam Neumann and Miguel McKelvey established GreenDesk, an "eco-friendly coworking space" in Brooklyn.[5] In 2010, Neumann and McKelvey sold the business and started WeWork with its first location in New York’s SoHo district.[5] By 2014, WeWork was considered “the fastest-growing lessee of new office space in New York” and was on track to become “the fastest-growing lessee of new space in America.”[12] “During the economic crises, there were these empty buildings and these people freelancing or starting companies,” Neumann told the New York Daily News. “I knew there was a way to match the two. What separates us, though, is community.”[5]

WeWork members have included startups such as Consumr, HackHands, Whole Whale, Coupon Follow, Turf, Fitocracy, Reddit and New York Tech Meetup.[13] In 2011, PepsiCo placed a few employees in the SoHo WeWork, who acted as advisors to smaller WeWork member companies.[12] The first WeWork Labs opened in New York’s SoHo in April 2011.[14] WeWork Labs functions as a startup incubator within WeWork.[14] It provides an open workspace with the goal of encouraging collaboration among members who “don’t have their business ideas fully cooked.”[14]

WeWork investors as of 2014 included J.P. Morgan Chase & Co, T. Rowe Price Associates, Wellington Management, Goldman Sachs Group, the Harvard Corp., Benchmark, and Mortimer Zuckerman, former CEO of Boston Properties.[12][2] As of January 2015, WeWork had 51 coworking locations in across the U.S., Europe and Israel – twice as many as it had at the end of 2014[15] with plans to expand to reach every continent (except Antarctica) by 2017.[12] On June 1, 2015 WeWork announced that Artie Minson, former Chief Financial Officer of Time Warner Cable, would join the company as President and Chief Operating Officer.[16] WeWork was named among the "most innovative companies" of 2015 by Fast Company magazine.[17]

It was announced on March 9, 2016, that WeWork raised $430 million in a new round of financing from Legend Holdings and Hony Capital Ltd., valuing the company at $16 billion.[18] As of October 2016, the company had raised $1.7 billion in private capital.[19] In October 2016, the company announced their plans to open a fourth location in Cambridge/Boston area. WeWork opened offices in Boston's Leather District and Fort Point in 2014 and have plans in place for a larger office in Back Bay. The first Cambridge office will be in Central Square and have space for 550 desks.[10] On January 30, 2017, the Wall Street Journal wrote that "SoftBank Group Corp. is weighing an investment of well over $1 billion in shared-office space company WeWork Cos., in what could be among the first deals from its new $100 billion technology fund."[20]

Conference rooms at a WeWork space in San Francisco

In April 2017, WeWork launched an online store for services and software for its members.[21] The company has also started offering fitness classes at a number of its locations and is opening a gym at a New York location.[21]

In July 2017, after an investment round the valuation of the company reached $20 billion.[22] Later that month, it was announced that WeWork would expand heavily into China, with US $500 million invested by SoftBank, Hony Capital[23] and other lenders to form a standalone entity called WeWork China.[24] In September 2017, WeWork expanded into Southeast Asia via the acquisition of Singapore-based SpaceMob, and it set aside a budget of $500 million to grow in Southeast Asia, which houses over 600 million people.[25]

In late October 2017, WeWork bought the Lord & Taylor Building on Fifth Avenue in Midtown Manhattan from the Hudson's Bay Company for $850 million.[26] After Christmas 2018, the Lord & Taylor store will be downsized to 150,000 square feet, renting the bottom floors, with the remaining space to be WeWork's headquarters.[27] The deal also includes the use of floors of certain HBC owned department stores in New York, Toronto, Vancouver and Germany as WeWork’s shared office workspaces.[28][29]

In January 2018, students taking online university courses from 2U gained access to WeWork common spaces and meeting rooms.[30]

In March 2018, SEC filings indicated that WeWork had raised over $400 million alongside private equity fund The Rhone Group to start a fund to purchase properties directly.[31] In April, documents filed by the company in association with a plan to raise $500 million through the issue of high-yield bonds showed that the company's revenues rose in 2017, but costs rose faster, and the company owed $18 billion rent.[32]

In July 2018, the company restricted employees from expensing meals that contain red meat, pork or poultry. WeWork also announced that it would not provide meat for events at its locations or allow meat at self-serve food kiosks in WeWork locations. The policy was rolled out to cover employees globally.[33] Company founder McKelvey claims that new research has shown that avoiding meat is one of the biggest things an individual can do to reduce their personal environmental impact. This policy has been criticized by some including WeWork employees as being incoherent as eggs are not part of the global ban despite the environmental impact of poultry farming for eggs nor is factory farmed fish banned. Some have suggested that this policy is about virtue signaling and branding. The change in policy has surprised certain commentators as the company had been the 2017 title sponsor for Houston’s Southern Smoke barbecue festival.[34]

In July 2018, WeWork closed a $500 million funding round aimed at expanding its business in China and valuing the company's subsidiary at $5 billion.[35]

Acquisitions and investments[edit]

On October 13, 2017, the company announced an acquisition of Flatiron School, a coding school offering classes online and at a location in Manhattan.[36]

During the $32 million series B of a women's only co-working space, The Wing, WeWork contributed a portion of the fund.[37]

In November 2017, WeWork acquired Meetup.[38]

In March 2018, WeWork acquired Conductor.[39][40]

In April 2018 it was announced that WeWork had merged its China operations with local competitor Naked Hub.[41]

In August 2018, WeWork acquired Designation, a Chicago-based, for-profit design school.[42]

In September 2018, they acquired Teem, an office management software company.[43]

Ventures[edit]

WeLive[edit]

WeWork launched a separate but related "co-living" venture called WeLive in 2016. WeLive applies the same basic principle of WeWork to housing, offering rental apartments that are grouped together with a number of shared spaces and services, such as cooking, cleaning, and laundry, as well as group activities and events. The first tests of the concept launched in New York City and also in Crystal City (VA), located steps from the Ronald Regan National Airport in the Washington D.C. Metro area.[44] Leaked internal documents from 2014 stated that WeLive is projected to make up 21% of WeWork's revenue by 2018.[45] By the end of 2016, WeLive has mostly phased out subsidies for its spaces in New York City under a “friends and family” arrangement that discounted rents by 15% to 20%.[46] Competitors to WeLive include Common, headquartered in New York, and HubHaus, headquartered in San Francisco.[47]

Rise by We[edit]

Rise (previously known as WeWork Wellness) is a luxury gym concept, currently only available at WeWork's Manhattan location.[48] The space consists of a yoga studio, boxing area, a boot-camp space with cardio equipment, and a general workout area.[49] It also hosts fitness classes and offers personal training sessions.[50] The location also has a spa.[51]

WeGrow[edit]

Announced in November 2017 for a planned opening in fall 2018, WeGrow is a private school for kids aged 3 through students in grade 4.[52] The first permanent location will be located in WeWork's New York headquarters.[53]

References[edit]

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External links[edit]