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WeWork Gets a Visit from Financial Reality

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Re: WeWork Gets a Visit from Financial Reality

#331

Post by oth001 »

EthanHeilman wrote: post #256
kgwgk wrote: post #93

https://www.bloomberg.com/opinion/articles/2019-01-08/wework... "In addition to the corporate finance weirdness: “Going forward, the company will no longer be called WeWork but rather The We Company.” (“The switch is not a legal name change,” okay.) And: “Rather than just renting desks, the company aims to encompass all aspects of people’s lives, in both physical and digital worlds,” which is—and I have spent years w…

The dystopian novel "We" tells the story of a society which encompass all aspects of your life, in both physical and mental worlds. >"We is set in the future. D-503, a spacecraft engineer, lives in the One State, an urban nation constructed almost entirely of glass, which assists mass surveillance. The structure of the state is Panopticon-like, and life is scientifically managed F. W. Taylor-style." https://en.wikipe…

Seems similar to Soylent, minus the mission statement.

Re: WeWork Gets a Visit from Financial Reality

#332

Post by shaklee3 »

paulie_a wrote: post #217
leesec wrote: post #62

Earlier quoted context omitted.

Even with self driving, there's effectively no difference to the consumer in experience/product whether the car drives it self or someone else does.

I strongly disagree. I have had many Uber rides where I wished it took longer to get to my destination. The driver engaged in fantastic conversation. I learned from them, I got insight into the area and recommendations. Self driving seems sterile.

Although, they probably wanted it to end so they could make more money on another fare.

Re: WeWork Gets a Visit from Financial Reality

#333

Post by strontium_90 »

PhantomGremlin wrote: post #321
pjc50 wrote: post #284

Earlier quoted context omitted.

It remains unlooted so far. It needs a layer of opaque billing, routinely bankrupting its customers, and profit extraction to match the healthcare industry.

It remains unlooted so far. On the contrary, public employee unions (including teachers) have done a masterful job of enriching themselves at public expense. E.g. Oregon: Member accounts saw appreciable and consistent growth during this time, but underlying pension assets did not grow to cover the increased benefit guarantee. Career public employees who worked from 1970 to 2000 often were entitled to retirement incom…

It's not obviously true that high pensions mean unfairly high remuneration. Another hypothesis that fits the facts you've mentioned could be that private sector salaries that could be earned by teachers are higher, and the public sector is competing by offering more attractive pensions for teachers than the private sector does.

There's another possible contributing factor: government can offer higher future pensions without increasing current expenditure (because government is not forced to fund the higher pensions until they need to be paid, many years in the future). Maybe that's why so many US states have dramatically underfunded pension plans (meaning teachers and other pensioners might not actually get their promised pensions when they retire).

Re: WeWork Gets a Visit from Financial Reality

#334

Post by camgunz »

PhantomGremlin wrote: post #321
pjc50 wrote: post #284

Earlier quoted context omitted.

It remains unlooted so far. It needs a layer of opaque billing, routinely bankrupting its customers, and profit extraction to match the healthcare industry.

It remains unlooted so far. On the contrary, public employee unions (including teachers) have done a masterful job of enriching themselves at public expense. E.g. Oregon: Member accounts saw appreciable and consistent growth during this time, but underlying pension assets did not grow to cover the increased benefit guarantee. Career public employees who worked from 1970 to 2000 often were entitled to retirement incom…

This is facially false. No one eligible for a public sector pension is well off. 130% of nothing is still nothing.

Like honestly, think of all the people you know in unions. What are their houses and cars like? Do they live in the rich neighborhoods with the doctors, lawyers, and professional athletes? Do their kids go to expensive private schools? Just outrageously wrong.

The issue here is that most (all?) state and local governments are very resource constrained by reactionary Republican low tax regimes, so the amount of money required for pensions (or health care or education) is a big pie slice. But if these governments adopted reasonable, progressive tax regimes with confiscatory upper limits, the pie would look very different.

In other words, look at the ruthless income inequality in this country before blaming budget shortfalls on government employees, social programs, and unions.

Re: WeWork Gets a Visit from Financial Reality

#335

Post by gaius »

EliRivers wrote: post #164
kgwgk wrote: post #93

https://www.bloomberg.com/opinion/articles/2019-01-08/wework... "In addition to the corporate finance weirdness: “Going forward, the company will no longer be called WeWork but rather The We Company.” (“The switch is not a legal name change,” okay.) And: “Rather than just renting desks, the company aims to encompass all aspects of people’s lives, in both physical and digital worlds,” which is—and I have spent years w…

a still evolving business that currently includes an elementary school and a coding academy. Education is like catnip to these people. It's like some kind of attractor industry. They're all convinced they have the magic formula.

Lots of money, not much oversight, “won’t somebody think of the children”.

Re: WeWork Gets a Visit from Financial Reality

#336

Post by pinot »

tnecniv wrote: post #320
badwolf wrote: post #236

Earlier quoted context omitted.

I'm currently "officing" in a WeWork dedicated desk. Out of all the desks immediately around me, I'm the only person working for a "tech" company. There's a building contractor, a couple designers, electrical engineers, and a Realtor, and a marketer for some distillery/alcohol co.

Just curious, what kind of company do the EEs work for if not tech?

Just guessing, but probably traditional electrical engineers. Like designing the power system for a restaurant buildout or whatever.

Re: WeWork Gets a Visit from Financial Reality

#337

Post by starik36 »

mcintyre1994 wrote: post #257

I get these financial criticisms, I doubt they'll last long when the recession hits. We were in one recently and I remember seeing a bulletin board thing I think showing stuff from their Instagram, but it said they're opening 40+ buildings a month. And there's probably 10 in walking distance of the City now. It's pretty insane. That said, we moved from a WeWork to a Spaces (the Regus clone-ish) and it's incredible th…

I don't think Spaces is the only one that can't get their act together. We moved to WeWork location last October. Took a week to sort out building passes. Took another one to deal with parking passes. Occasionally (yesterday), the gate won't open - trapping you in the garage. Thankfully, it's staffed by a human being now who will open it manually.

Finally and unbelievably, there is a bathroom on our floor that has no toilet cover dispenser. Bathrooms on other floors have it, but not this one. I mentioned it to the staff and they were told by their superiors that one won't be installed.

There is a lot to like about the location, but these problems are just simply comical and won't get fixed for whatever reason.

Re: WeWork Gets a Visit from Financial Reality

#338

Post by starik36 »

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…

Which WeWork in OC did you tour? Mine is definitely not overcrowded - lots of empty offices.

Re: WeWork Gets a Visit from Financial Reality

#339

Post by Blackstone4 »

This Bloomberg article got it wrong. The stock market has been going down and they jumped on a potentially negative story. Bottom line is SoftBank didn't make as much money in the IPO of its Japanese telco unit and the Vision fund can't invest due to Saudi interest.

From Dan Primack's column at Axios:

>"The state of play: There's lots of buzz about how this deal is much smaller than what was originally contemplated, including one 2018 report whereby SoftBank could acquire a majority stake in the co-working space giant.

>The big picture: We told you in October that the control deal was no longer on the table, but that investment negotiations were ongoing.

>Fast Company this morning reports, based on an interview with CEO Adam Neumann, that the two sides neared a much-larger deal that could have bought out all of WeWork's existing shareholders, but that SoftBank bailed after a disappointing IPO for its Japanese mobile unit. In short, SoftBank's corporate balance sheet was smaller and less flexible than had been originally anticipated. SoftBank theoretically has enough dry powder in its Vision Fund, but we hear that the Saudi connections made that prospect less appealing to both sides due to perceived regulatory risk (read: CFIUS, particularly in light of the Khashoggi murder). The bottom line: Don't read this deal as a macro commentary on unicorn troubles. SoftBank is still investing $2 billion into WeWork, in which it already holds a sizable position though both its balance sheet and Vision Fund, and doing so at a high valuation.

>Not even the most profligate investor spends that kind of coin if it believes the market is crumbling. There also is a NYT report that SoftBank may have had trouble getting enough WeWork shareholders to sell into the larger proposal."

[0] https://www.axios.com/authors/danprimack

Re: WeWork Gets a Visit from Financial Reality

#340

Post by mcintyre1994 »

reustle wrote: post #325
mcintyre1994 wrote: post #257

I get these financial criticisms, I doubt they'll last long when the recession hits. We were in one recently and I remember seeing a bulletin board thing I think showing stuff from their Instagram, but it said they're opening 40+ buildings a month. And there's probably 10 in walking distance of the City now. It's pretty insane. That said, we moved from a WeWork to a Spaces (the Regus clone-ish) and it's incredible th…

Surprised at how many locations they have, if this is the correct company: https://www.spacesworks.com/locations/

That's the one - I wonder if they just rebranded some existing Regus places? Or maybe they're building as fast as WeWork, I'm not sure.

Funny thing about that list though - their app doesn't remember your office location, so if you want to book a meeting room you have to drill down from every Spaces location worldwide down to your country, then city, then office to find the one in your building. :)

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