No one will be shocked or surprised to learn that We Company filed to withdraw its IPO. CEO Adam Neumann is out and the new team needs some time and privacy to turn WeWork around – if that is even possible.
Others have covered the financial mess, so I won’t rehash it here. But as a (soon to be former) WeWork customer, I can speak to the very narrow use case WeWork spaces solve for.
A few years ago, the flexibility of office-sharing made sense to us. Our engineering staff was growing at an astonishing rate and we could not estimate how many teams we would ultimately need to service our clients’ needs. The solution was easy… WeWork.
From an accounting (and managerial) perspective, the ability to convert traditionally fixed overhead to variable expenses was almost irresistible.
But the nature of work/life has changed over the past 24 months. First and foremost, WeWork has some serious competition. There are several “Class A” buildings in cities all over the world that offer fractional or sharable workspaces. And, to be blunt, while the vibe at WeWork is young and fun, the physical plant is impossible for anything other than sitting quietly in a room with headphones on.
I can personally do the sales pitch for the startup across the hall from my area (I hear it 20x daily whenever I’m there). There is no such thing as a private conversation in WeWork’s signature glass cube office spaces, and you can’t make a call without seeking out a phone booth (never available) or roaming the halls — creepy — or renting extra space to use as phone or huddle rooms. WeWork designed itself for a specific purpose and the alternative solutions are much, much better.
When you combine the competitive landscape with the greater acceptance of remote workers, WeWork has some serious existential issues to deal with. Oh, one more thing. WeWork is about 25% more expensive than the competitive spaces we have found to replace them.
None of this will come as news to anyone who rents space from WeWork, but if you haven’t tried to work at a WeWork I can save you some time. There are better ways to achieve the same flexibility, but with increased productivity.
Author’s note: This is not a sponsored post. I am the author of this article and it expresses my own opinions. I am not, nor is my company, receiving compensation for it.
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