Following WeWork's warning that it could be headed for bankruptcy, FOX Business gives a timeline of the long-suffering co-working company's years of troubles.
I think a lot of the issue is that softbank had the idea of if they can invest a bit and get a good amount of growth, how about they invest a ton more from the outset and “guarentee” insane growth. They did that with a few startups and it worked, then they did it with WeWork and it spectacularly backfired. The basic premise of WeWork was pretty sound until the real estate market started going up in price, which kind of blew up the margins that WeWork lived in. That and a frankly financially crazy CEO kind of ruined it.
I think the special part was having smaller rental spaces and that feeling of having coworkers in an office that weren’t actually your coworkers. I used to deliver to a lot of we work and we work type places and I sort of got the appeal for startups. Some definitely didn’t have privacy like another commenter mentioned.
In the beginning, WeWork definitely was about renting to smaller companies (or individuals) at reasonable prices, providing decent (if not upscale) accomodations. That’s probably a decent little business.
But their CEO had (or at least, promoted) delusions about WeWork providing a fundamentally different experience. Some of those delusions were IIRC software projects he claimed would allow renters to automate and improve their network and electricity use. He sold this bullshit on talk shows, and gave this as a reason that WeWork wasn’t just another renter of office space. In reality, they didn’t have the expertise to do anything like he claimed, and it all came to nought.
Maybe if he hadn’t been spending money like a fleet of drunken sailors, much of it on himself or vanity projects, they might’ve not cratered as badly, or at least as quickly.
And that’s a perfectly reasonable business, but nothing revolutionary.
If their business would have been co-working franchises, in the sense that you can have an office everywhere and with some set standards, it could even have been a good business. But it’s low-margin, nothing like Google or Facebook.
I think a lot of the issue is that softbank had the idea of if they can invest a bit and get a good amount of growth, how about they invest a ton more from the outset and “guarentee” insane growth. They did that with a few startups and it worked, then they did it with WeWork and it spectacularly backfired. The basic premise of WeWork was pretty sound until the real estate market started going up in price, which kind of blew up the margins that WeWork lived in. That and a frankly financially crazy CEO kind of ruined it.
WeWork never made much sense. The entire business is just co-working spaces and regular office space rental. There’s nothing special about it at all.
No no; you see - it was in the cloud.
That means it should be patentable and it will provide 38% returns over four years. Trust me, bro.
I think the special part was having smaller rental spaces and that feeling of having coworkers in an office that weren’t actually your coworkers. I used to deliver to a lot of we work and we work type places and I sort of got the appeal for startups. Some definitely didn’t have privacy like another commenter mentioned.
In the beginning, WeWork definitely was about renting to smaller companies (or individuals) at reasonable prices, providing decent (if not upscale) accomodations. That’s probably a decent little business.
But their CEO had (or at least, promoted) delusions about WeWork providing a fundamentally different experience. Some of those delusions were IIRC software projects he claimed would allow renters to automate and improve their network and electricity use. He sold this bullshit on talk shows, and gave this as a reason that WeWork wasn’t just another renter of office space. In reality, they didn’t have the expertise to do anything like he claimed, and it all came to nought.
Maybe if he hadn’t been spending money like a fleet of drunken sailors, much of it on himself or vanity projects, they might’ve not cratered as badly, or at least as quickly.
And that’s a perfectly reasonable business, but nothing revolutionary.
If their business would have been co-working franchises, in the sense that you can have an office everywhere and with some set standards, it could even have been a good business. But it’s low-margin, nothing like Google or Facebook.
Totally. But Adam Neumann wasn’t going to settle for “low-margin”, nosirree! Low margins don’t buy you jets and mansions.