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Critics say WeWork is an overvalued real-estate play

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Re: Critics say WeWork is an overvalued real-estate play

#161

Post by shostack »

j4p3 wrote: post #17

Many people, including the author, skip the more interesting point in favor of the lazy critique: WeWork is not being valued by its investors as an office rental company. It's made the case that it is a business services marketplace, selling vendors' insurance and HR and legal and servers to as large as swath of the small business sector as it can grab with its fancy offices. It wants to own the app store for enterpr…

In some ways that sounds like the Zenefits model. Compete with one service on lower/break-even margins, and use it as lead-gen for selling in other higher-margin services.

If they can sufficiently grow and diversify their recurring revenue streams across services offered and industries of clients served, that could give them solid staying power, even in a down market.

Re: Critics say WeWork is an overvalued real-estate play

#162

Post by eyko »

gumby wrote: post #62
eyko wrote: post #29

Earlier quoted context omitted.

Not if you regularly have clients come around for meetings or colleagues for a chat. WeWork provides a good enough atmosphere to work and socialise with work related people (it's not just the desk you're paying for).

I have started several companies from my home (for the first two, "home" was an apartment) and had no problem with employees working from the "office" nor with customer meetings (customers included Sun, NASA, Cisco). These have all been in Palo Alto, so perhaps its acceptability is location-specific. Each year I have some MBA students from Switzerland visit and last year it was in my home -- apparently some of them w…

If you pay someone to keep your home clean and tidy, have ample space, free beer, good coffee, and very comfortable furniture, then by all means. Not everyone has that luxury! WeWork (and similar co-working spaces) is a workspace where all the little details are taken care of for you. The location is also important - I don't live that close to a main train station or hotels so having a relatively centric workspace is handy for visitors. They also create an atmosphere that I wouldn't be able to create at home, with nice break out areas. The only thing I miss is not having a proper kitchen to myself, like I do when I work from home.

Oh and yes, I do work from home, sometimes the entire week.

Re: Critics say WeWork is an overvalued real-estate play

#163

Post by bobbles »

EGreg wrote: post #151

I think WeWork is great. But I think commutes are a time suck. How about the new trend of Officeless (TM) companies, connecting entirely online, working asynchronously and taking breaks to go to the beach and socialize with friends instead of random people. Your talent pool can suddenly come from all over the world, and costs cheaper while making employees happier.

Only really works if all of your friends work in the same environment though right

Re: Critics say WeWork is an overvalued real-estate play

#164

Post by hedora »

Trump’s recent attempt to torpedo obamacare by allowing multi-company group plans seems like an opportunity here.

WeWork should offer a group plan to tenants. It creates lockin, and most tenants are young+healthy, so this would be a great deal all around (cheap premiums, low barrier to entry for older workers).

Re: Critics say WeWork is an overvalued real-estate play

#165

Post by inuhj »

baxtr wrote: post #91

I worked in a wework Office for about a year. At first I thought the environment was great, I loved the free beer and the community. However, once we moved out, I realized how much more productive we were in our own office. We had - more space - less noise, in terms of sound and visually (you see everybody passing by through the glass and have to force yourself not to look at them. For a while we had some posters up,…

WeWork was way too expensive at any size. We cancelled it quickly. I can't imagine it being a functional solution for any company. Churn will kill that business.

Re: Critics say WeWork is an overvalued real-estate play

#166

Post by incendiary »

lloyd-christmas wrote: post #90
potatolicious wrote: post #81

Earlier quoted context omitted.

I don't think it's a case of people being negative about the idea of WeWork - the issue is is that WeWork's product is/will be commoditized, and as such will be subject to intense price competition. This is good for people who enjoy WeWork's product, since there are (and will be more) competitors that offer a similar experience for less money. But it's bad for WeWork's valuation - and that's the core thing being brou…

General Assembly's bootcamp program probably isn't the best out there, but the company is worth a hell of a lot more than the rest of the bootcamp industry. Just because a business is easy to imitate doesn't mean it's easy to compete at scale. There are plenty of similar set ups to wework in NYC, but they don't have offices in countless other countries and cities. They simply don't have the scale that the wework netw…

The main difference is that General Assembly has product differentiation, and where you studied has signalling value. Where you rent your office space, much less so. Hence, WeWork produces a highly commoditized product, which will continually be subject to competitive pressure.

Re: Critics say WeWork is an overvalued real-estate play

#167

Post by erikb »

feelin_googley wrote: post #89
erikb wrote: post #55

Earlier quoted context omitted.

all of your links are walling again, AND deactivating reader mode in my browser.

Retrieve the page with a small http client instead of a large browser. e.g., wget, curl, fetch, etc. Save it. wget -o savedpage.htm https://www.wsj.com/amp/articles/wework-a-20-billion-startup-fueled-by-silicon-valley-pixie-dust-1508424483 Delete the Javascript. sed -i '/ /,/ /!d' savedpage.htm Open savedpage.htm in a browser.

Loving your sed skills!

Re: Critics say WeWork is an overvalued real-estate play

#168

Post by lmm »

cratermoon wrote: post #74
sillysaurus3 wrote: post #66

Earlier quoted context omitted.

Not sure why people are negative about the core idea of WeWork. You get free beer, free coffee, bathrooms, an office, meeting rooms, phone booths with doors that close that you can also go work in whenever you want to be isolated, you can be there 24 hours a day, you have a keycard that works at all hours, and best of all, you're surrounded by startups and companies doing the same things as you. Meaning you can chat…

It's a reasonable office services model -- every company would like to have (at least) fresh coffee, internet, print/copy services, meetings rooms, janitorial service, etc. All the unsexy things that make a workspace into a place to get stuff done. Depending on the size, the companies may do it themselves, or may contract with one of the many vendors for that. With WeWork, though, the sweet spot is for companies that…

> We found that having a meeting for 3-4 people couldn't happen on a whim, you had to book a room and if none were available you had to delay the meeting. Also, our meetings could never run long because inevitably someone else had booked the room afterwards and needed us out.

Every company I've worked for (none of which were WeWerk) has had this issue.

Re: Critics say WeWork is an overvalued real-estate play

#169

Post by hellokadi »

gonehome wrote: post #52

A little off topic, but I think it'd be cool if you could pay someone (a hotel chain? Airbnb?) a monthly 'rent' to live in any of their locations. The locations are guaranteed to have highspeed internet and some easy standardized way to move between them. This would be really cool for remote work since you could live everywhere and nowhere without having the overhead of having to do all the planning yourself.

This is kind of it. Still on my bucket list.. https://www.we-roam.com/

Re: Critics say WeWork is an overvalued real-estate play

#170

Post by G2kyd7 »

The advantage of the WeWork system is the convenience of quickly getting office space on a monthly-basis without dealing with internet for as well for example. What I have noticed that they do not cater to remote workers small start ups any longer, instead they are renting out whole floors to fortune 500 companies. I agree with others, the meeting room system is a rip-off, which is why no one is using it and people are simply squatting in those rooms.

Overall it works for me after 2 years in three different locations, there are certainly a few issues: - cooling (Miami) is either way too cold or not working at all and often comes with deafening noise - their employees are often not trained well enough, presumably due to rapid expansion - coffee is absolutely awful (maybe acceptable for American standards) - annoying tech bros sponsored by their parents - events that are geared towards the above (beer pong, really?) - getting spammed by people who think networking means sending everyone unsolicited messages offering their services - noise from people who apparently don't have to work and aggregate in the hallways instead

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