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I'm not sure the founder sees it as a tech or real estate company but something more: >In 2017, Neumann declared that WeWork’s “valuation and size today are much more based on our energy and spirituality than it is on a multiple of revenue.” He has long maintained that categorizing WeWork as a real-estate concern is too limiting; it is a “community company” with huge ambitions. “We are here in order to change the wor…
So WeWork is more like McDonald? I wonder how close they are to McDonald in business model.
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They all need technolgy and came about because of the powerful handheld mobile device. The first three are at least software companies. Business and social changes aside, WeWork could have happened 20 years ago.
> They all need technolgy and came about because of the powerful handheld mobile device. I'm not sure why Uber is a tech company because you can order a taxi using your phone, but WeWork is not ... because you can reserve a room or space using your phone? Not all members pay for an office. Some of us are nomads and stay at whichever WeWork is convenient. We make reservations for space using our phone.
Early on, one of the UX joys of Uber was being able to see where your driver was and how soon before they would arrive. SMS wouldn't be quite the same, would it?
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Maturity transformation, to give it its proper name, isn’t inherently a bad business; it’s how your bank transforms your weekly or monthly pay packet into a 25-year mortgage. But - and here is the crucial point - it is not tech .
Uber isn't tech, it is a taxi company. Stripe isn't tech, it is a payment processor. Airbnb isn't tech, it is a hotel. SpaceX isn't tech, it is a defense contractor.
Uber isn't at taxi company, since it doesn't own or operate taxis. Conceptually it's a platform for connecting independent taxi operators with customers, like Expedia or Craigslist or eBay.
Airbnb isn't a hotel company, since it doesn't own or operate hotels. Conceptually it's a platform for connecting independent hotel operators with customers, like Expedia or Craigslist or eBay.
SpaceX isn't a tech company any more than NASA is. They require science and technology but they sell rides on space ships that they own and operate.
It's a 1920s (pre-FDIC) bank, or a 2008-style risky financial instrument, like an Auction-Rate Preferred. WeWork's business model is "borrow short, lend long." That is, they accept very short term promises to pay (month to month leases from customers), and aggregate them to make very long term promises to pay (mutli year leases from suppliers). Keep the spread. This works as long as there are lots of customers who wi…
No, that is the market. Just like airbnb compared to normal renting.
... and yet it will be valued as one. At this point it doesn't matter if anything really is tech or not. Rich people just want to park their money away from banks. (As an aside, i think WeWork’s S1 has turned to a remarkable feat of marketing, making buzz around the company in cycles who are likely to be their customers)
Bingo. Although I don't know about rich people wanting to park their money away from banks. It's more like we have a massive capital glut, there's so much capital sloshing around we don't know what do with it. So some wealthy people will buy bonds with negative yields, others will buy equity at inflated valuations like WeWork. Strange times.
Pretty good time to have a lot of money (it's always a good time to have a lot of money), to own a business in a developing economy, to start a "tech" company to be acquired in a developed economy, to be in private equity, or to fraud/bluff your way into a lot of money in a developed economy (true productivity-increasing products/technologies are currently few and far between but globalization of technology and outsourcing is still going strong).
Not a great time to be poor, a saver, a licensed professional, or worker of any sort in a developed economy (aside from working at a "tech" company).
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This isn't that dissimilar from lots of industries. Every airline that takes a loan to buy a plane is banking on future demand for air travel, for example. Or take Amazon Web Services, which is building data centers to lease out on a short term basis. Yes, there are tremendous risks involved, depending on the lease terms. But it's not at all unusual.
It is dissimilar though. In the examples you gave, the airline or Amazon are taking on debt to purchase a plane or a bunch of servers themselves, so if the demand decreases in the future, they can sell off those assets. They would probably incur a loss, but at least they could recoup some of their investment. WeWork on the other hand is not a landlord and does not own anything other than the furniture in the offices.…
You are really pushing this point hard, when it does not fit.
I like that WeWork is finally forcing us to have the conversation about WTF a "tech company" even is. A company that sells software? Or one that employs a lot of engineers? Or companies that use a lot of tech in their operations? Companies with a presence in San Francisco and Kombucha on tap? Are big banks tech companies? Insurance providers? Hospitals, auto manufacturers, oil and gas... What isn't a tech company?
There are enough things wrong with wework that this is just muddying the issue.