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WeWork needs to go prove itself by surviving the next downturn. I believe most of WeWork's customers are other startups who valuations are fueled by large round
by dmode 9y ago
WeWork needs to go prove itself by surviving the next downturn. I believe most of WeWork's customers are other startups who valuations are fueled by large rounds of VC investment. This capital tends to dry out during a downturn, however WeWork will still be saddled with long term leases during this period. I wonder what their strategy is to ride out a period of low capital raise for startups.
- sarreph 9y agoThis will indeed be very interesting to watch out for. Speaking from experience, WeWork has a high turnover rate — VC-money-hungry startups line the hallways, coming and going accordingly. I don't think the established, boutique firms and agencies constitute a large enough chunk of their business to support them in a recession. Their rent is just too high to capture the frugal companies who'll be the survivors of a poor market; lowering prices might save them, but I don't know how well their model accounts for this.
- username223 9y agoYep. Webvan was awesome at stocking our fridge during the last tech bubble, but ran out of customers and money really fast when it burst. According to Wikipedia, > Webvan was an online grocery business that went bankrupt in 2001 after 3 years of operation and was later folded into Amazon.com. Hmmm... Maybe Amazon will buy WeWork for cheap, then use it to push their other services?