The biggest revenue opportunity for WeWork is big corporations opening smaller office location in cities where just want to staff a small field office or operations office. Example, Uber opening an office in let's say Columbus. Now instead of Uber going on a real estate hunt, they can simply rent out space in WeWork Columbus which gives them flexibility to scale or shrink depending on business. It is essentially abstracting away the real estate inefficiencies. There is a definitely a market for it. But not sure whether it is worth $47bn
This probably true, and there's a company similar to WW in Montreal who did a presentation indicating that as well.
The thing is: there's very little competitive advantage in that.
Having 'cool decor' is less valuable to larger companies, and it's not as though other entities can't duplicate that if they want.
Other, more established firms can inch their way into copying some of WW's mojo, and compete on price, which the CFO's of said companies will appreciate.
I wouldn’t say cool decor isn’t valuable to larger companies. If you’re a stodgy, older firm you’re going to get some chunk of Millennials that will decide that your beige cubicle farm isn’t anywhere they want to work. Or you might be running investors through the office and they don’t know jack about tech but if you don’t have a bunch of kids in hoodies clustered around the kombucha dispenser then they might just pass.
A good brand is a valuable form of competitive advantage. And real estate itself provides done scarcity value since each property is unique and there are limited attractive properties in high demand locations. I agree they’re in more danger from commoditization and competition than a company with strong network effects, but executed correctly they could have more natural advantage than say, a Chobani or Stitch Fix or Deciem.
I'm sorry but I don't see how what you're describing is different to any of the existing office rental companies out there and if WeWork were valued like them it'd be a completely different story.
