How Did WeWork’s Adam Neumann Build a $47B Company? • Hacker News Board

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#11

Post by manishsharan » Mon, Jun 10, 2019, 8:25 PM UTC

Short Answer: he is riding the Gig economy just like Uber etc.

Most viable businesses with a steady revenue stream can afford to rent office space and furnish it on their own. But the self employed folks -- the web designeers, SEM experts, and various other professionals without a steady employer need a place to work. For some, working from home is not an option due to regulation or family consideration etc. For most, working from a coffee shop is a very bad idea for various reason including ergonomics. WeWork fills this niche. Is this a $47B niche ? very unlikely .

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#12

Post by b_tterc_p » Mon, Jun 10, 2019, 8:26 PM UTC

warp_factor wrote: post #5

exogeny wrote: post #4

He made investors believe in a non-sensical vision that is not rooted in any sort of financial or commercial reality in the middle of an insane bull market. Simple.

You got it slightly wrong: He made investors believe that there will be bigger more stupid investors that will eventually buy out the shares for a higher price than those investors. (Also, see Uber, Lyft and other ponzy scheme based companies)

Maybe! That’s what happened. Is it his initial plan? Unclear. Results don’t proof intentions or even competence.

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#13

Post by [deleted] » Mon, Jun 10, 2019, 8:28 PM UTC

manishsharan wrote: post #11

Short Answer: he is riding the Gig economy just like Uber etc. Most viable businesses with a steady revenue stream can afford to rent office space and furnish it on their own. But the self employed folks -- the web designeers, SEM experts, and various other professionals without a steady employer need a place to work. For some, working from home is not an option due to regulation or family consideration etc. For most…

[deleted]

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#14

Post by netaustin » Mon, Jun 10, 2019, 8:32 PM UTC

manishsharan wrote: post #11

Short Answer: he is riding the Gig economy just like Uber etc. Most viable businesses with a steady revenue stream can afford to rent office space and furnish it on their own. But the self employed folks -- the web designeers, SEM experts, and various other professionals without a steady employer need a place to work. For some, working from home is not an option due to regulation or family consideration etc. For most…

The"real business" of WeWork et al seems to be selling an entrepreneurial vibe to big companies. Lots of folks in my distributed company work at WeWorks around the country, and most of their neighbors work for big companies. One of my colleagues is almost fully surrounded by a Dish Network call center. WeWork will even custom build for big customers — in fact, their Enterprise landing page is a good an index to their view of the future as anything: https://www.wework.com/enterprise

I think the Short Answer is that the solo renters are the sizzle and the Fortune 500 is the steak.

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#15

Post by sharadov » Mon, Jun 10, 2019, 8:34 PM UTC

I have the next billion-dollar business idea, an " Airbnb for coworking spaces". Convert your existing house to a co-working space. Looked at Wework, already pay too much for rent in the Bay area. I work from home, and would not mind the company. Got good coffee and great beer as well!

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#16

Post by hdpq » Mon, Jun 10, 2019, 8:35 PM UTC

I'll just go on the record to say that I think WeWork is the biggest deck of cards that is begging for a collapse. I've only been to a handful of locations, but they never seem busy and I'm not sure how they're making rent.

Plus, not to mention, back in my day, when you did a startup and got funding from your rich uncle (not Uncle Rich), you grew your startup from your apartment, and when you outgrew that space, you got a bigger apartment. (ala Silicon Valley style)

I dunno, I can't put my finger on it, but I think this whole thing is a massive game of charades...

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#17

Post by nugget » Mon, Jun 10, 2019, 8:36 PM UTC

manishsharan wrote: post #11

Short Answer: he is riding the Gig economy just like Uber etc. Most viable businesses with a steady revenue stream can afford to rent office space and furnish it on their own. But the self employed folks -- the web designeers, SEM experts, and various other professionals without a steady employer need a place to work. For some, working from home is not an option due to regulation or family consideration etc. For most…

>Most viable businesses with a steady revenue stream can afford to rent office space and furnish it on their own

Yes, but do they want to?

My experience is that companies increasingly want to focus on their core competencies and nothing else, especially if the non core areas come with overhead in the form of full time employees. I could easily see non-HQ locations outsourced to a company like WeWork. For a satellite office of 50 people there is hundreds of thousands of dollars in annual overhead that could be drastically slashed by a local provider operating at much vaster scale. Less liability and variability for the employer and the employees likely end up with a better quality work environment.

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#18

Post by cutenewt » Mon, Jun 10, 2019, 8:36 PM UTC

GCA10 wrote: post #8

thedudeabides5 wrote: post #3

Earlier quoted context omitted.

Anyone know what revenue for the next largest coworking space is?

So IWG plc, which has a British stock-market listing and does business mostly as Regus, had 2018 revenue of £2.5 billion and a current market cap of about £3 billion. It thus trades at about 1.2x annual revenue. WeWork's multiple is way higher.

I'm curious what Regus' take is on WeWork (i.e. strategy).

In other words, did they start a hip new WeWork-killer? Attempt to compete on price? Have special retention marketing campaigns to stave off clients from going to WeWork.

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#19

Post by cutenewt » Mon, Jun 10, 2019, 8:37 PM UTC

sharadov wrote: post #15

I have the next billion-dollar business idea, an " Airbnb for coworking spaces". Convert your existing house to a co-working space. Looked at Wework, already pay too much for rent in the Bay area. I work from home, and would not mind the company. Got good coffee and great beer as well!

How much would you be willing to rent "a desk" each month?

Re: How Did WeWork’s Adam Neumann Build a $47B Company?

#20

Post by baxtr » Mon, Jun 10, 2019, 8:40 PM UTC

hdpq wrote: post #16

I'll just go on the record to say that I think WeWork is the biggest deck of cards that is begging for a collapse. I've only been to a handful of locations, but they never seem busy and I'm not sure how they're making rent. Plus, not to mention, back in my day, when you did a startup and got funding from your rich uncle (not Uncle Rich), you grew your startup from your apartment, and when you outgrew that space, you…

The ones I saw were very busy, and, filled by large corporates that wanted to be hip. I think for them value proposition is that they are able to hire some hipster people who don't want to work in the old buildings and also build some marketing stories around their "labs".

That said, I "worked" in a WeWork for about 6 months and it was just terrible. Tiny offices, lots of visual distractions, lots of noise, many parties. I wouldn't ever do it again.