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I don't think it's a case of people being negative about the idea of WeWork - the issue is is that WeWork's product is/will be commoditized, and as such will be

I don't think it's a case of people being negative about the idea of WeWork - the issue is is that WeWork's product is/will be commoditized, and as such will be subject to intense price competition. This is good for people who enjoy WeWork's product, since there are (and will be more) competitors that offer a similar experience for less money. But it's bad for WeWork's valuation - and that's the core thing being brought up. WeWork's valuation is based on the idea that they can charge a premium for their product (relative to more traditional office rentals or other coworking providers), and/or that they can sell significant ancillary services on top of the base rental fees. I don't think either of those expectations have played out, and IMO there are lots of reasons to believe that they won't play out at all. WeWork isn't the only one - SV is full of startups that expected to exist in a premium marketplace that isn't as sensitive to price competition, but found themselves instead running a well-executed, but extremely commoditized product.

lloyd-christmas 9y ago
General Assembly's bootcamp program probably isn't the best out there, but the company is worth a hell of a lot more than the rest of the bootcamp industry. Just because a business is easy to imitate doesn't mean it's easy to compete at scale. There are plenty of similar set ups to wework in NYC, but they don't have offices in countless other countries and cities. They simply don't have the scale that the wework network already has. Why would I join one of the other NYC ones for a discount on office space when I can gain business from all around the world just by signing into the member network and checking my messages?
- incendiary 9y ago
  The main difference is that General Assembly has product differentiation, and where you studied has signalling value. Where you rent your office space, much less so. Hence, WeWork produces a highly commoditized product, which will continually be subject to competitive pressure.

lloyd-christmas 9y ago

General Assembly's bootcamp program probably isn't the best out there, but the company is worth a hell of a lot more than the rest of the bootcamp industry. Just because a business is easy to imitate doesn't mean it's easy to compete at scale. There are plenty of similar set ups to wework in NYC, but they don't have offices in countless other countries and cities. They simply don't have the scale that the wework network already has. Why would I join one of the other NYC ones for a discount on office space when I can gain business from all around the world just by signing into the member network and checking my messages?

incendiary 9y ago
The main difference is that General Assembly has product differentiation, and where you studied has signalling value. Where you rent your office space, much less so. Hence, WeWork produces a highly commoditized product, which will continually be subject to competitive pressure.