Thriving In Smaller Markets
Coworking has created considerable buzz in the professional world in recent years, enhancing the ways in which people of different professional backgrounds work together and view the workplace. Coworking refers to a collaborative work style in which self-employed individuals and individuals from varying professional backgrounds share an office to facilitate the exchange of knowledge and increase productivity on a personal level. This work style has become particularly popular among people who crave a nontraditional office space, and as more people gravitate toward it, shared workspace providers, such as WeWork and Knotel, have become lucrative companies in competition with one another.
In anticipation of the next economic downturn that could potentially damage WeWork’s expansive portfolio of leases in about 475 buildings worldwide, the company has shifted its mission away from rent arbitrage to creating a large-scale tech company. Most recently, WeWork acquired Euclid, a San Francisco-based software company that specializes in spatial analytics and gathering data on people as they move through physical space, suggesting WeWork’s plans to evolve into an expansive data-driven tech company have firmly taken root. Let’s chronologically explore all recent acquisitions by WeWork that point to the company’s goal to expand in profound ways.
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In August 2015, WeWork acquired Case, an architectural modeling software firm, and has since made its apps open source, meaning the original source code has been made freely available for redistribution and modification.
The March 2016 WeWork acquisition of Welkio, a digital sign-in system for office guests, marked a major step in WeWork’s expansion into territories other than rent arbitrage. The fact that WeWork invested in this secure sign-in system for their offices signifies the company’s dedication to smoother operations as part of a larger expansion plan.
WeWork acquired Fieldlens, a communication platform for construction sites, in June of 2017, solidifying WeWork’s plans to expand into certain territories unrelated to rent arbitrage.
WeWork acquired the Singapore-based coworking company in August 2017, and soon after allotted $500M toward expansion throughout Southeast Asia and South Korea. With a stronghold on the coworking market in crucial areas of the Asian continent, WeWork confirmed they are one of the coworking companies to beat.
WeWork’s August 2017 acquisition of Unomy, an Israeli tech company, that came on the heels of the Spacemob acquisition marked another major phase in WeWork’s expansion. Although Unomy is no longer offered as a service and was shut down in 2017, the acquisition remains a significant indicator of WeWork’s growing wealth.
Coding has become a lucrative and promising line of work in the current professional landscape, and WeWork’s acquisition of the Flatiron School, a Manhattan-based private coding academy offering a 15-week software engineering program, suggests WeWork knows this to be true too.
In November 2017 WeWork acquired Meetup, a website that inspires people with similar interests to get off the Internet and meet up in real life, for a reported $200M.
WeWork acquired the digital marketing startup that helps businesses target advertisements to their customers based on user data in March 2018 with the plan to run it as a separate line of business available to WeWork members and non members.
WeWork acquired the Chinese coworking startup based in Shanghai, Beijing, and Hong Kong in April 2018, marking the second acquisition of a coworking competitor after Spacemob in 2017. Although the specifics of the deal were not disclosed, WeWork is thought to have purchased Naked Hub for $400M during a time when WeWork was specifically focusing on growth outside of the United States.
Shiva Rajaraman, a WeWork Chief Product Officer, said the Euclid acquisition is a part of WeWork’s “workplace insights,” a software analytics package for companies that want their space to be like WeWork offices but aren’t renting space from WeWork. The Euclid technology could, for example, gather metrics on the popularity of a certain meeting area in an office—how many people use it and how often they use it—enabling landlords and tenants to use the space in a more cost-effective manner.
WeWork’s rapid acquisition streak took off after raising a whopping $4.4B from Softbank, a Japanese multinational holding conglomerate, in 2017. Since then, WeWork has not slowed its acquisitions, averaging about one every two months. Currently valued at $45B, WeWork continues to acquire and expand as more individuals in the professional world discover the benefits of coworking. Only time will tell if WeWork’s major acquisitions in recent months will ultimately benefit or detract from the coworking-centric mission of the company.
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