9 ms·

WeWork exits 40 U.S. locations after tepid forecast

98 points by donutshop 4y ago

bhouston 4y ago
Weird. I thought we all this work from home and giving up offices it would make sense to use wework the times you do get together. At least that is what we are doing.
- chrisseaton 4y ago
  I haven't used WeWork myself, but I thought it wasn't really set up for booking an office for just a few days - I thought it was a little longer term than that. Is that not the case?
  - easton 4y ago
    They have both, although the single day rental usually is restricted to the open areas and conference rooms. I used it for a few days a couple months ago in DC, it was nice to get out of the Airbnb I was in. But also relatively cheap ($19 a day with no commitment), and it looks like that location has closed since :(
  - michaelt 4y ago
    As I understand it, WeWork has a range of options, starting with "on-demand hot desks, almost like working in a coffee shop" and going up to "all the office facilities a 100-person startup needs"
- lovehashbrowns 4y ago
  It’s what I wanted to do! I was going to stay with my parents for 6 months and then get a shared office at one of these spaces, not wework but a competitor. It was going to be so great, I thought. The terms really didn’t make it fun, though. I think it was 3x monthly rent as a security deposit plus the first month’s rent. Sounds reasonable, except it was going to take something like 60 days for the security deposit to be returned. How convenient that my check for the deposit takes days but theirs takes 60 days. All I wanted was to stay in Chicago until the real winter hit. :( I also don’t get the insanity of charging 3x rent as a security deposit for a shared office. It’s a square box with a chair and table. How do I cause $1,800 worth of damage to that?!
  - bombcar 4y ago
    They’re afraid you’re realize it was a shit deal and stop paying rent I suspect. Then they can keep the deposit and try to rent it out again. The economics of all this works great on paper but very badly in real life.
  - Inhibit 4y ago
    That smacks of the same model as a gym membership. Sucker in a large number of marginal users and make it as onerous and hard to leave as possible under law to retain them as long as possible... that's the actual business model.
- paulgb 4y ago
  I think that's exactly what's happened, but it's led to demand of drop-in rather than permanent offices (WeWork does both). We have an office in one of the 40 locations being closed, and it's mostly an office location (I'm not sure if you can even book a day pass there). My guess is that they will move to expand drop-in and bookable spaces, and reduce the number of private offices. Already I've seen some private offices turned into bookable meeting rooms.
aeonik 4y ago
I honestly really like these types of shared temp offices. I've used them before, but my work won't reimburse me for their use, and they cost more than a coffee shop. Some coffee shops in my area also have built in meeting rooms at very reasonable prices.
- trh0awayman 4y ago
  I bought a yearly zoo membership, which is where I work most days now. I get to hang with the animals after work, and there are plenty of quiet, forgotten spaces within zoos. The zoo cafeterias/cafes are basically empty on weekdays, so I just bop around day to day.
  - jpm_sd 4y ago
    Wow, I love this idea! I already have a zoo membership and an aquarium membership... I wish my body handled laptop ergonomics better. I just can't deal with it for days on end, got to have my desktop, big monitor, fancy mouse and comfy chair.
    - JacobDotVI 4y ago
      Try a roost stand (or equivalent) and external keyboard and track pad (I use the smallish apple ones). This has saved my posture when working from outside my office. It’s not the equivalent of the home base setup but it’s good enough that my neck isn’t screaming at me at the end of the day
      - urban_strike 4y ago
        Another vote for a folding stand + separate keyboard and mouse at desk-level. I'm always working outside the house, and once you can adjust to working on a single monitor it's been great ergonomically.
  - JohnAaronNelson 4y ago
    That’s super creative. I’ve never heard of someone doing something like this before.
jermaustin1 4y ago
Coworking spaces existed before WeWork, but WeWork did cause an explosion of them (at least in NYC metro and Houston - the two places I've lived during this explosion). But the cost prop just isn't there in a lot of cases. I just recently looked up a bunch of various coworking spaces in Houston, and the monthly shared desk pass averaged $450/mo with dedicated desks and offices starting at $700-1000. And I find that weird, because all across Craigslist (in between the "executive office" and coworking spam) there are dedicated small offices (60-100 sqft) that go for around the same price as a shared desk. Almost always they include the same amenities (coffee, snacks, drinks), but it is in a boring office building or in another company's office build-out that they have no need for.
- achow 4y ago
  > ..but it is in a boring office building That is where their disruption strategy was. WeWork in hindsight had a brilliant idea. A readymade exciting, fun-filled work environment - the culture aspect. This would be virtually impossible to create by a single or handful of employees by themselves. Infact big companies struggle to create exciting culture for new age employees even with dedicated team and funds. WeWork could have worked if it was managed well.
  - bergenty 4y ago
    Who the hell wants a “fun filled” work environment. I like that my coworking space is nice and quiet and I don’t have to make small talk so I can go back home to my family and friends for those things.
  - jermaustin1 4y ago
    Maybe I'm in the minority, but I dont want a fun-filled work environment. I want to work then go home to my family where we have a fun-filled home environment.
    - zemvpferreira 4y ago
      You (and I) are in the minority, or at least there are a good number of people that feel the opposite. Looking around me I see plenty of acquaintances that use work to get as far away as possible from their homes and families. People are weird, man.
maxehmookau 4y ago
I'm starting to enjoy much smaller, hyperlocal coworking spaces. Part of the benefits of homeworking is that I don't need to travel to a city centre to work. WeWork (at least in the UK) are situated entirely in city centres which means to use them I still have to commute which has a time and financial cost. Not to mention, they're always the most expensive option here. Places like this [1] are a short walk from where people actually live. [1] https://www.theoldpostoffice.space/ https://www.theoldpostoffice.space/
paulcole 4y ago
About 14 months ago, I started going to WeWork because of all the news about how horribly mismanaged it was. I thought it would be good value for my dollar since so much was being “subsidized” by the SoftBank investment. The rumors were true! An extremely nice (extremely empty) building with great amenities for a fair price. I ended up renting a 1-person office for a discounted rate of about $450/month. At my last renewal, I was told that discount was no longer available because 1-person offices at my location were in such high demand. So I gave it up and switched back to the “All Access” membership for $299/month which basically grants access to the shared spaces and phone booths in the building. The issue is that there’s nearly an entire floor of empty office space in the building. But it’s built out in the form of open offices for 30, 50, or 100-person companies. There just seems to be no interest in that but high interest from individuals who want a private office. I’m curious to see if my location will be affected by the closures. If it isn’t, I can only shake my head and wonder how bad of shape some of these buildings are in financially.
- Tarsul 4y ago
  I truly hope that in a few years small offices will come back. It appears that right now companies just decrease their rents and space (because a part of their employees are working at home) but are still gung-ho on open office. However, I think in a few years maybe all this new, free space can be used for people like you and me who want small offices. Maybe it will happen, who knows.
  - bombcar 4y ago
    It's exceptionally sad because the companies leasing out these buildings just want to lease; they'll throw up walls and do other renovations if you ask. I was with a company that moved from a larger space into a smaller one and they were perfectly happy to throw up some walls to make offices and take down a pair of walls to make a copier space - "for free".
dayvid 4y ago
My favorite coworking space was Code & Supply in Pittsburgh. It was designed by programmers for programmers. Simple place, but really cool people with a similar vibe and tables with monitors you can plug into. WeWork is alright, but a lot of the design and stuff fades away and you’re just working on a small desk that’s like a coffee shop with good internet and some phone booths.
- snapcaster 4y ago
  +1 for C&S
ur-whale 4y ago
Suprised to hear they're still in business at all.
boringg 4y ago
In other related news how is Adam Neumann's new crypto real estate company (Flow) invested in by A16Z (350M @ >1B valuation) doing these days?
unethical_ban 4y ago
I wanted to get a shared workspace in San Antonio, but I didn't find any workspace that wasn't said to be a rip-off or total pain to sign up for. WeWork isn't here, and if they're cutting off locations, I'm sure they're not planning to be.
rchaud 4y ago
> WeWork went public in 2021 after a two-year struggle and currently has a market cap of around $1.77 billion. Its pre-IPO valuation was once pegged at nearly $50 billion. If there was ever a reason for news media to stop taking VC-reported implied valuations as gospel, this would be it.
benjaminwootton 4y ago
Their salesforce don’t seem to be particularly motivated. I was recently looking to upgrade to a permanent office. Filled in the form a few times, left voicemails but never heard anything back. Their competition seem much hungrier and willing to negotiate to get the business signed.
m_ke 4y ago
Airbnb is doing great right now, wouldn't be the worst idea to let wework tank a bit more then acquire it at a discount and do a bit of rehab. A ton of business travelers would probably like to have access to office space on their trips.
bitwize 4y ago
Ah, WeWork. A company I worked at was very large, but decided to cosplay as a lean mean agile startup in order to recruit programmers with a friendly "how do you do, fellow young people". To that end they rented an entire floor of a WeWork. Place was a noisy, open-plan zoo, and the shiny-happy-people WeWork energy seeping in made it even more difficult to focus and get anything done. Free espresso drinks were nice, but I would much rather have forgone those and worked in a cubicle in the company's stodgy, regular office a block away. Thankfully, COVID shifted their WFH policy and not only could I WFH, they cancelled their WeWork lease.

98 points by donutshop 4y ago

Weird. I thought we all this work from home and giving up offices it would make sense to use wework the times you do get together. At least that is what we are doing.

chrisseaton 4y ago
I haven't used WeWork myself, but I thought it wasn't really set up for booking an office for just a few days - I thought it was a little longer term than that. Is that not the case?
- easton 4y ago
  They have both, although the single day rental usually is restricted to the open areas and conference rooms. I used it for a few days a couple months ago in DC, it was nice to get out of the Airbnb I was in. But also relatively cheap ($19 a day with no commitment), and it looks like that location has closed since :(
- michaelt 4y ago
  As I understand it, WeWork has a range of options, starting with "on-demand hot desks, almost like working in a coffee shop" and going up to "all the office facilities a 100-person startup needs"
lovehashbrowns 4y ago
It’s what I wanted to do! I was going to stay with my parents for 6 months and then get a shared office at one of these spaces, not wework but a competitor. It was going to be so great, I thought. The terms really didn’t make it fun, though. I think it was 3x monthly rent as a security deposit plus the first month’s rent. Sounds reasonable, except it was going to take something like 60 days for the security deposit to be returned. How convenient that my check for the deposit takes days but theirs takes 60 days. All I wanted was to stay in Chicago until the real winter hit. :( I also don’t get the insanity of charging 3x rent as a security deposit for a shared office. It’s a square box with a chair and table. How do I cause $1,800 worth of damage to that?!
- bombcar 4y ago
  They’re afraid you’re realize it was a shit deal and stop paying rent I suspect. Then they can keep the deposit and try to rent it out again. The economics of all this works great on paper but very badly in real life.
- Inhibit 4y ago
  That smacks of the same model as a gym membership. Sucker in a large number of marginal users and make it as onerous and hard to leave as possible under law to retain them as long as possible... that's the actual business model.
paulgb 4y ago
I think that's exactly what's happened, but it's led to demand of drop-in rather than permanent offices (WeWork does both). We have an office in one of the 40 locations being closed, and it's mostly an office location (I'm not sure if you can even book a day pass there). My guess is that they will move to expand drop-in and bookable spaces, and reduce the number of private offices. Already I've seen some private offices turned into bookable meeting rooms.

aeonik 4y ago

I honestly really like these types of shared temp offices. I've used them before, but my work won't reimburse me for their use, and they cost more than a coffee shop. Some coffee shops in my area also have built in meeting rooms at very reasonable prices.

trh0awayman 4y ago
I bought a yearly zoo membership, which is where I work most days now. I get to hang with the animals after work, and there are plenty of quiet, forgotten spaces within zoos. The zoo cafeterias/cafes are basically empty on weekdays, so I just bop around day to day.
- jpm_sd 4y ago
  Wow, I love this idea! I already have a zoo membership and an aquarium membership... I wish my body handled laptop ergonomics better. I just can't deal with it for days on end, got to have my desktop, big monitor, fancy mouse and comfy chair.
  - JacobDotVI 4y ago
    Try a roost stand (or equivalent) and external keyboard and track pad (I use the smallish apple ones). This has saved my posture when working from outside my office. It’s not the equivalent of the home base setup but it’s good enough that my neck isn’t screaming at me at the end of the day
    - urban_strike 4y ago
      Another vote for a folding stand + separate keyboard and mouse at desk-level. I'm always working outside the house, and once you can adjust to working on a single monitor it's been great ergonomically.
- JohnAaronNelson 4y ago
  That’s super creative. I’ve never heard of someone doing something like this before.

jermaustin1 4y ago

Coworking spaces existed before WeWork, but WeWork did cause an explosion of them (at least in NYC metro and Houston - the two places I've lived during this explosion). But the cost prop just isn't there in a lot of cases. I just recently looked up a bunch of various coworking spaces in Houston, and the monthly shared desk pass averaged $450/mo with dedicated desks and offices starting at $700-1000. And I find that weird, because all across Craigslist (in between the "executive office" and coworking spam) there are dedicated small offices (60-100 sqft) that go for around the same price as a shared desk. Almost always they include the same amenities (coffee, snacks, drinks), but it is in a boring office building or in another company's office build-out that they have no need for.

achow 4y ago
> ..but it is in a boring office building That is where their disruption strategy was. WeWork in hindsight had a brilliant idea. A readymade exciting, fun-filled work environment - the culture aspect. This would be virtually impossible to create by a single or handful of employees by themselves. Infact big companies struggle to create exciting culture for new age employees even with dedicated team and funds. WeWork could have worked if it was managed well.
- bergenty 4y ago
  Who the hell wants a “fun filled” work environment. I like that my coworking space is nice and quiet and I don’t have to make small talk so I can go back home to my family and friends for those things.
- jermaustin1 4y ago
  Maybe I'm in the minority, but I dont want a fun-filled work environment. I want to work then go home to my family where we have a fun-filled home environment.
  - zemvpferreira 4y ago
    You (and I) are in the minority, or at least there are a good number of people that feel the opposite. Looking around me I see plenty of acquaintances that use work to get as far away as possible from their homes and families. People are weird, man.

maxehmookau 4y ago

I'm starting to enjoy much smaller, hyperlocal coworking spaces. Part of the benefits of homeworking is that I don't need to travel to a city centre to work. WeWork (at least in the UK) are situated entirely in city centres which means to use them I still have to commute which has a time and financial cost. Not to mention, they're always the most expensive option here. Places like this [1] are a short walk from where people actually live. [1] https://www.theoldpostoffice.space/ https://www.theoldpostoffice.space/

paulcole 4y ago

About 14 months ago, I started going to WeWork because of all the news about how horribly mismanaged it was. I thought it would be good value for my dollar since so much was being “subsidized” by the SoftBank investment. The rumors were true! An extremely nice (extremely empty) building with great amenities for a fair price. I ended up renting a 1-person office for a discounted rate of about $450/month. At my last renewal, I was told that discount was no longer available because 1-person offices at my location were in such high demand. So I gave it up and switched back to the “All Access” membership for $299/month which basically grants access to the shared spaces and phone booths in the building. The issue is that there’s nearly an entire floor of empty office space in the building. But it’s built out in the form of open offices for 30, 50, or 100-person companies. There just seems to be no interest in that but high interest from individuals who want a private office. I’m curious to see if my location will be affected by the closures. If it isn’t, I can only shake my head and wonder how bad of shape some of these buildings are in financially.

Tarsul 4y ago
I truly hope that in a few years small offices will come back. It appears that right now companies just decrease their rents and space (because a part of their employees are working at home) but are still gung-ho on open office. However, I think in a few years maybe all this new, free space can be used for people like you and me who want small offices. Maybe it will happen, who knows.
- bombcar 4y ago
  It's exceptionally sad because the companies leasing out these buildings just want to lease; they'll throw up walls and do other renovations if you ask. I was with a company that moved from a larger space into a smaller one and they were perfectly happy to throw up some walls to make offices and take down a pair of walls to make a copier space - "for free".

dayvid 4y ago

My favorite coworking space was Code & Supply in Pittsburgh. It was designed by programmers for programmers. Simple place, but really cool people with a similar vibe and tables with monitors you can plug into. WeWork is alright, but a lot of the design and stuff fades away and you’re just working on a small desk that’s like a coffee shop with good internet and some phone booths.

snapcaster 4y ago
+1 for C&S

ur-whale 4y ago

Suprised to hear they're still in business at all.

boringg 4y ago

In other related news how is Adam Neumann's new crypto real estate company (Flow) invested in by A16Z (350M @ >1B valuation) doing these days?

unethical_ban 4y ago

I wanted to get a shared workspace in San Antonio, but I didn't find any workspace that wasn't said to be a rip-off or total pain to sign up for. WeWork isn't here, and if they're cutting off locations, I'm sure they're not planning to be.

rchaud 4y ago

> WeWork went public in 2021 after a two-year struggle and currently has a market cap of around $1.77 billion. Its pre-IPO valuation was once pegged at nearly $50 billion. If there was ever a reason for news media to stop taking VC-reported implied valuations as gospel, this would be it.

benjaminwootton 4y ago

Their salesforce don’t seem to be particularly motivated. I was recently looking to upgrade to a permanent office. Filled in the form a few times, left voicemails but never heard anything back. Their competition seem much hungrier and willing to negotiate to get the business signed.

m_ke 4y ago

Airbnb is doing great right now, wouldn't be the worst idea to let wework tank a bit more then acquire it at a discount and do a bit of rehab. A ton of business travelers would probably like to have access to office space on their trips.

bitwize 4y ago

Ah, WeWork. A company I worked at was very large, but decided to cosplay as a lean mean agile startup in order to recruit programmers with a friendly "how do you do, fellow young people". To that end they rented an entire floor of a WeWork. Place was a noisy, open-plan zoo, and the shiny-happy-people WeWork energy seeping in made it even more difficult to focus and get anything done. Free espresso drinks were nice, but I would much rather have forgone those and worked in a cubicle in the company's stodgy, regular office a block away. Thankfully, COVID shifted their WFH policy and not only could I WFH, they cancelled their WeWork lease.