WeWork Isn’t a Tech Company • Hacker News Board

Re: WeWork Isn’t a Tech Company

#131

Post by gumby » Wed, Aug 21, 2019, 11:53 PM UTC

dsl wrote: post #105

goatinaboat wrote: post #80

Earlier quoted context omitted.

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.

I wouldn’t call Uber especially high tech but it’s ok to consider it “tech”. While WeWork is literally just a landlord with no technical value ad. The closest it is to “tech” is its customers.

Re: WeWork Isn’t a Tech Company

#132

Post by rosege » Wed, Aug 21, 2019, 11:55 PM UTC

They don't have an R&D budget which a tech company of this size should have. They are similar to Regis which is actually profitable.

Re: WeWork Isn’t a Tech Company

#133

Post by morpheuskafka » Thu, Aug 22, 2019, 12:33 AM UTC

nostromo wrote: post #24

rlucas wrote: post #20

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…

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.

AWS is really a good comparison. It turned buying a server and getting an annual colo lease into "per-second" billing, and WeWork offers per-day pricing for office real estate instead of an annual lease.

Re: WeWork Isn’t a Tech Company

#134

Post by briandear » Thu, Aug 22, 2019, 12:35 AM UTC

dsl wrote: post #105

goatinaboat wrote: post #80

Earlier quoted context omitted.

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 a taxi company, it’s a marketing company for independent drivers.

Re: WeWork Isn’t a Tech Company

#135

Post by coding123 » Thu, Aug 22, 2019, 12:44 AM UTC

dsl wrote: post #105

goatinaboat wrote: post #80

Earlier quoted context omitted.

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.

If you're calling SpaceX a defense contractor, then nothing is tech. So what's your ACTUAL definition of "tech" like Apple? Or are you going to say - No, Apple is a fashion company?

Even if AirBnB isn't "tech company" it definitely is NOT a hotel.

Re: WeWork Isn’t a Tech Company

#136

Post by briandear » Thu, Aug 22, 2019, 12:45 AM UTC

paxys wrote: post #10

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?

A tech company is a company that sells technology, not a company that uses it. An insurance company sells the product of insurance, how they do it is irrelevant — they still sell insurance. Apple is a tech company — they develop and sell technology. Uber is a tech company: they sell yield management systems to independent car owners who want to sell space in their car. A bank isn’t a tech company; they don’t sell technology, they sell investments/banking services. A company that sells medical diagnostic tools is a tech company. A hospital isn’t. They sell the service of fixing your broken body, using tech from suppliers who are tech companies.

A company that uses tech isn’t a tech company. A tech company is one that sells tech. It’s pretty clear what the difference is. WeWork is a real estate company, that’s it.

Re: WeWork Isn’t a Tech Company

#137

Post by Apocryphon » Thu, Aug 22, 2019, 12:46 AM UTC

Thrymr wrote: post #127

rwallace wrote: post #126

Earlier quoted context omitted.

> SpaceX isn't tech, it is a defense contractor. When you get to the point of saying space rockets are not technology, it's time to acknowledge that somewhere in the construction of your ontology, something has gone wrong.

In this context I take "tech" to mean software, as in arbitrarily scalable with an exponential growth curve. (Not that that can last forever in software, either, but it is growth potential that drives valuations.)

While you're not wrong, aliasing tech (or even "high-tech") to mean exclusively software seems quite insulting to the rest of technologies.

Re: WeWork Isn’t a Tech Company

#138

Post by adriand » Thu, Aug 22, 2019, 12:54 AM UTC

dsl wrote: post #105

goatinaboat wrote: post #80

Earlier quoted context omitted.

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.

I think this is a reasonable comment to make (perhaps unworthy of downvotes, which it seems to be accumulating), but I will note that the article defines "successful modern tech companies" as generally having five principal features:

- Low variable costs

- Low capital investments

- A lot of customer data and customer intimacy

- Network effects

- Ecosystems that boost expansion with little cost

Based on those features, of the companies that you listed here, Uber and Airbnb are definitely tech companies. So is Stripe, I think most of us would agree, although I'm not sure whether there are many network effects with their platform. SpaceX is not.

As such, the only way your point really stands is if one can make a valid argument that WeWork is doing something material and tech-focused that makes it different from a standard commercial real estate company. If it were leasing space and successfully executing on a model with low variable costs, low capital investments, lots of data, network effects and expansion-boosting ecosystems, that would be one thing. That doesn't appear to be the case.

Re: WeWork Isn’t a Tech Company

#139

Post by perl4ever » Thu, Aug 22, 2019, 12:56 AM UTC

jbay808 wrote: post #68

paxys wrote: post #64

Earlier quoted context omitted.

So tech = innovation? I don't think that's a common definition.

A car company isn't a company that uses cars, it's a company that makes cars. Technology is "the application of science to commercial or industrial objectives" according to the dictionary. But a technology company is a company that makes technology. That inherently requires innovation.

It seems to me that excludes all software from "tech". The computers are tech, but how they are configured isn't "making" anything.

Re: WeWork Isn’t a Tech Company

#140

Post by qroshan » Thu, Aug 22, 2019, 12:56 AM UTC

maratd wrote: post #108

chiefalchemist wrote: post #106

Earlier quoted context omitted.

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.

The article actually gave you hints as to how to evaluate

Marginal Cost of Servicing an Extra Uber Driver is $0 Marginal Cost of Servicing an Extra Uber Passenger is $0

Uber is a Tech Company.