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WeWork Gets a Visit from Financial Reality

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Re: WeWork Gets a Visit from Financial Reality

#141

Post by dkjshfajskdfa »

wil421 wrote: post #118
scandox wrote: post #5

Earlier quoted context omitted.

In 1999 there was an email going round about how ridiculous dotcom valuations were. Taking Amazon, I think, as an example it said it would have to earn more than Kodak, Boeing, Caterpillar etc to ever be worth it's valuation. There was a general sense of "it's just a bookstore". Now I know everything is more mature and the situation is different, but I also remember feeling very confident that Amazon was waaay overva…

What about pets.com and webvan? I feel like we are back in the webvan days again. Except the companies figured out they could trick regular folk into doing deliveries instead of driver who is an actual employee with some kind of benefits.

I think the key difference is the ubiquity of smart phones and the changes to the labor market after the panic of 08.

Re: WeWork Gets a Visit from Financial Reality

#142

Post by carlsborg »

Some anecdotal trends from first hand observations in a few co-working spaces: 1] Startups that do well tend to outgrow the co-working space and leave for their own offices. 2] Higher salaries/interesting job openings in larger companies due to economic growth and low unemployment at the macro level means fewer people co-working at startups that don't do well. 3] Remote workers want to arbitrage living costs so they leave big cities and go to low cost areas.

Re: WeWork Gets a Visit from Financial Reality

#143

Post by ahi »

ghaff wrote: post #14
demarq wrote: post #10

Earlier quoted context omitted.

I agree that Tesla is probably just a car company but no american cab company operates in 72 countries outside of america though.

I tend to agree that Uber and Lyft are qualitatively different from traditional cab companies although, as many others have said, I'm not sure they have much of a moat or economies of scale. For the overwhelming majority of Uber users, it's irrelevant that they're in 72 countries or even multiple countries. In fact, I'm sure many users would switch to a better service that just operated in their own city.

Uber and Lyft have worse economics than traditional cab companies. Traditional cab companies have the advantage of fleet maintenance and higher utilization rates. Without VCs and financially illiterate drivers subsidizing fares, Uber and Lyft would be the high cost providers.

Re: WeWork Gets a Visit from Financial Reality

#144

Post by mikestew »

Traster wrote: post #4

>The Gulf investors backing the Vision Fund seem to have decided that WeWork is not a tech bet but simply an aggressive punt on real estate. This is the bogey man of a huge number of current 'tech startups' - What if it turns out Tesla really are a car company! Or if We Work are actually an office rental company! OR gasp Uber is a cab company! (1) We now have a glut of companies operating in traditional markets that…

Somewhere along the way I think we got it flipped around. No one was calling Sears a tech company in 1969 just because they bought an IBM 370 to computerize their accounting and inventory. By probably 1975, if you were Fortune 500 and still doing your books by hand you were probably just a dinosaur rather than your computerized competitors being so advanced.

Uber, Tesla, okay, maybe there is an argument to be made for them to be "tech companies". Like the referenced investors, I fail to see how WeWork is anything but a real estate play, and consequentially having to work from that rulebook. Oh, you have computer systems involved? Welcome to the 21st! Where everyone else does, too.

In summary, I don't think simply using a phone app to do some form of collaboration or logistical deployment using assets owned or contracted by the company qualifies one as a "tech company" anymore. I think they're still a traditional company doing what everyone else ought to (and eventually will) be doing to begin with.

Re: WeWork Gets a Visit from Financial Reality

#145

Post by rrggrr »

holoduke wrote: post #129

I really wonder why and how companies are willing to rent at these places. It's full of arrogant pricks and the failure rate of startups is insane. I founded a company few years ago. Was offered space at we work for about 3k for just 100square feet. Few days of searching through local real estate companies brought me a 300square feet office for 1.5k at a similar location. Only no freebeers and fancy entrance.

Just looked at a WeWork space today. The use case is an attractive place for a remote employee to work for us in a job that attracts (and is best done) by a highly social person. I can't get the right person leaving them at home, and I can't relocate them to me.

Re: WeWork Gets a Visit from Financial Reality

#146

Post by dragandj »

Spivak wrote: post #138
dragandj wrote: post #60

Earlier quoted context omitted.

> which means it requires much less capital They burned through billions of dollars of capital. That's quite a lot for a business that requires very little capital. What would they burn if they needed lots of capital? Trillions of dollars?

I mean half a million drivers each with a car that say costs $20k over its lifetime is about 10 billion. So like maybe?

Is there a single company in the world that pays for its machinery with cash, upfront? I don't think so.

Re: WeWork Gets a Visit from Financial Reality

#147

Post by auiya »

whalesalad wrote: post #83
sachinprism wrote: post #9

I feel like WeWork would be one of the first companies to go under in case a recession hits the US market. Everyone who works there is probably going to decide en masse that they can do the same things from home or a Starbucks

We (2 of us, expected to grow to 4 quickly) toured WeWork, Spaces (Regus) and a few other one-off spots here in Orange County. Everyone was pretty pricey, like 2500/mo for 100 square feet. WeWork was definitely the worst and was the most overcrowded... but hey they have beer on tap! (sarcasm) Ultimately we grabbed a lease on Pacific Coast Highway with a sweeping view of the ocean for less with about 3x the room in a…

> These coworking spaces are terrible.

They're like Monkey Joe's for tech bro's.

Re: WeWork Gets a Visit from Financial Reality

#148

Post by linkmotif »

I really wanted WeWork to work for me. But it did not.

During my time there, it became apparent that their entire focus was on growth. WeWork was never interested in catering to their core market: people who want to work. They failed to create a productive work environment. They alienated people like me, who were willing to pay top dollar for a decent place to work. Instead they created distraction-filled, tacky places that fostered little except beer drinking.

I'm looking forward to seeing it crumble, or at least for reality to catch up.

PS. If anyone knows a co-working space in NY that actually provides a nice, quiet place to work, please let me know. I will pay good money for such a place. I am thinking like https://misantrope.com/?lang=en

Re: WeWork Gets a Visit from Financial Reality

#150

Post by whalesalad »

auiya wrote: post #147
whalesalad wrote: post #83

Earlier quoted context omitted.

We (2 of us, expected to grow to 4 quickly) toured WeWork, Spaces (Regus) and a few other one-off spots here in Orange County. Everyone was pretty pricey, like 2500/mo for 100 square feet. WeWork was definitely the worst and was the most overcrowded... but hey they have beer on tap! (sarcasm) Ultimately we grabbed a lease on Pacific Coast Highway with a sweeping view of the ocean for less with about 3x the room in a…

> These coworking spaces are terrible. They're like Monkey Joe's for tech bro's.

It's not really tech bro's ... I don't encounter those people very often. I think that fraternity style vibe has kinda gone by the wayside. It's everyone else who aren't really technologists but want to get in on the gold rush. The social media marketing companies, the wordpress/magento factories, the crypto people, the uber-for-xyz... there is a lot of noise both literally and figuratively with these groups.
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