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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

#171

Post by Chris2048 »

sillysaurus3 wrote: post #73
rezistik wrote: post #69

Earlier quoted context omitted.

It's not free beer and free coffee, it's X% of $2,200 a month beer and Y% of $2,200 a month coffee.

Sure, but your corporate overlord^W^Wfounder pays for that. From your POV, it's all you can drink coffee. Also $2200 is on the high end for four people. You can probably talk them down to $2k or less. You'd be surprised how valuable it is to have a pot of coffee ready to go all the time, next to a mini fridge that's always stocked with half and half. Sweetner's on the counter. It ends up taking like 30 seconds to gra…

> It ends up taking like 30 seconds to grab coffee

Try this stuff: http://www.nestle.co.uk/brands/coffee/superpremium/azera

Just mix with hot water, it's surprisingly good.

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

#172

Post by eli_gottlieb »

sillysaurus3 wrote: post #73
rezistik wrote: post #69

Earlier quoted context omitted.

It's not free beer and free coffee, it's X% of $2,200 a month beer and Y% of $2,200 a month coffee.

Sure, but your corporate overlord^W^Wfounder pays for that. From your POV, it's all you can drink coffee. Also $2200 is on the high end for four people. You can probably talk them down to $2k or less. You'd be surprised how valuable it is to have a pot of coffee ready to go all the time, next to a mini fridge that's always stocked with half and half. Sweetner's on the counter. It ends up taking like 30 seconds to gra…

Why does that need a startup, though? Sounds like the perfect opportunity for a small-companies' cooperative.

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

#173

Post by bluntfang »

eddieplan9 wrote: post #10
neaden wrote: post #9

"Boston Properties Inc., the country’s largest publicly traded office landlord, owns five times the square footage that WeWork manages and has a market capitalization of $19 billion." This seems to me to be a pretty big warning sign that the company is overvalued.

Comparing WeWork to traditional office landlord is like comparing Starbucks to Dunkin' Donut. Please don't go to Starbucks because its coffee is better or cheaper (it's neither), but as a lifestyle choice. Similarly, people don't go to WeWork because they need a desk.

starbucks and dunkin donuts are similarly priced in pretty much all areas. They both have regular coffee at similar price points. They both have fancy sugary drinks at similar price points. They both have food at similar price points.

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

#174

Post by bluntfang »

neaden wrote: post #12
eddieplan9 wrote: post #10

Earlier quoted context omitted.

Comparing WeWork to traditional office landlord is like comparing Starbucks to Dunkin' Donut. Please don't go to Starbucks because its coffee is better or cheaper (it's neither), but as a lifestyle choice. Similarly, people don't go to WeWork because they need a desk.

Your metaphor is ridiculous. Plenty of people prefer Starbucks coffee to DD, claiming that going to Starbucks is a "lifestyle choice" in 2017 is absurd. People go to Starbucks because it has products they like, primarily a variety of coffee drinks that include milk, cream, sugar, or other flavorings. Comparing Starbucks to DD is a perfectly appropriate thing to do, as is comparing WeWork to Boston Properties is a rea…

Dunkin Donuts has those same sugary milky drinks. Starbucks vs Dunkin is white collar vs blue collar.

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

#175

Post by shawnee_ »

inuhj wrote: post #165
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.

While agree that the pricing is not beneficial to startups themselves, churn is exactly what WeWork wants because it's what their business model is founded on.

All predatory leasing systems are designed this way. In WeWork's case, as a landlord it does not care about the success or failure of any individual company; it cares only about running as many renters as it can through its overpriced bar / coffeehouse. In the process its goal is to extract as much of the founders' equity as possible through "addons" in fees and such to the rents.

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

#176

Post by readhn »

lnanek2 wrote: post #65
dmode wrote: post #38

Earlier quoted context omitted.

Honestly, as someone dealing with small businesses, selling insurance and HR services to tiny startups is not a $20B business. Selling those to large companies is, but that market is already saturated.

The WeWork claim is that some of their startups will become huge and they'll already have their foot in the door, so to speak, for selling those huge companies more real estate and services. Having a 5 person startup as a renter is not a big win, but if that startup becomes Twitter size...

haha. seeing that most start ups will fail - good luck with waiting for that unicorn! it might never come in their space.

https://www.forbes.com/forbes/welcome/?toURL=https://www.for...

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

#177

Post by username223 »

dmode wrote: post #37

WeWork needs to go prove itself by surviving the next downturn. I believe most of WeWork's customers are other startups who valuations are fueled by large rounds of VC investment. This capital tends to dry out during a downturn, however WeWork will still be saddled with long term leases during this period. I wonder what their strategy is to ride out a period of low capital raise for startups.

Yep. Webvan was awesome at stocking our fridge during the last tech bubble, but ran out of customers and money really fast when it burst. According to Wikipedia,

> Webvan was an online grocery business that went bankrupt in 2001 after 3 years of operation and was later folded into Amazon.com.

Hmmm... Maybe Amazon will buy WeWork for cheap, then use it to push their other services?

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

#178

Post by SOLAR_FIELDS »

Alex3917 wrote: post #144
cotterphinney wrote: post #122

Earlier quoted context omitted.

THANK YOU. At first I was very confused as to why there were so many half-full milk jars in the fridge but it soon made sense. I don't think this is WeWork's "fault" in that Ronnybrook milk only seems to last about two hours after opening, but they should really buy another brand.

It's not just the opened ones. Every time I go into a WeWork I usually end up opening several things of milk to see if there are any that haven't gone bad, and there almost never are. It's like they're turning off the refrigerators at night or something. It's literally been a problem for several years. The company even acknowledged the problem on Twitter at one point, but didn't bother fixing it.[1] It shouldn't be t…

A bit of deflection on part of the company too. "it sounds like this is an ongoing issue for you"

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

#179

Post by timdierks »

lmm wrote: post #168
cratermoon wrote: post #74

Earlier quoted context omitted.

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.

Yeah, this is the state of affairs at Google, for example.

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

#180

Post by kafkaesq »

kafkaesq wrote: post #130
zaidf wrote: post #123

Earlier quoted context omitted.

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, but we had to remove them since wework’s company policy doesn’t like that) This has been by number one issue with WeWork and I've always been surprised that more devs who work at WeWork aren't bothered by this.

That's what the free beer is for - to anesthetize yourself from the negative working conditions, at the end of the day.

Addendum: WeWork's general office conditions and amenities do compare favorably to those of early-stage companies (not to mention most random BigCorps), overall. (Again, it's the average of the great unwashed mass of companies I'm talking about, here -- not the Big 4, and certainly not whatever hot startup you've worked for recently where everything was way nicer, and the people way cooler than anywhere else).

But at the same time - if anyone's giving you free beer (as opposed to some other non-mind-altering amenity), there's always a reason for it.

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