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> Putting $4.4bn into WeWork, a provider of shared workspaces, valuing it at $20bn, is another risky bet. The firm leases office space, redesigns it to create a
by l5870uoo9y 8y ago
> Putting $4.4bn into WeWork, a provider of shared workspaces, valuing it at $20bn, is another risky bet. The firm leases office space, redesigns it to create a hip vibe and sublets it to startups, freelancers and some big firms. The worry is that WeWork is little more than a commercial-property company that is unjustifiably trading on a tech valuation and will soon be rumbled.
I was impressed by how fast WeWork expands. In Berlin it now has 7 co-working spaces all fairly close located. They recently bought meetup.com.
- mxschumacher 8y agoa couple of coworking spaces pale in comparison to $4.4bn in equity investments. they are looking for a return of more than 10% p.a. It'll take lots of design freelancers to produce $500m in cash
- nikanj 8y agoIt’s easy to expand fast, when you expand by burn, not by customer acquisition. Want to have 10x empty offices in 10x cities? Just burn 100x more money.
- deleted 8y ago[deleted]
- dalbasal 8y ago"commercial-property company that is unjustifiably trading on a tech valuation" I kind of wonder which way the causation runs. Those "tech multiples" are supposedly a reflection of profit & growth potential. Growth requires investment. Margins tend to be in some way linked to investment too. It's easier to have a better margin if (a) you have cheap money and (b) if you can afford to take some risks for long term gain. Both have to do with multiples. Why doesn't Tesla have an auto manufacturer multiple?