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Comment by badestrand | Hacker News Reader

I don't really understand the WeWork valuation of $20 billion. I guess they buy all their properties so they greatly profit from the rising property prizes in capitals around their world.

I work a lot in coworking spaces and they usually don't seem like a cash cow for the owners. Now WeWork seems to target the B2B and luxury segment of coworking with prices 1,5x-3x of the competitors'. Interesting strategy.

So is the coworking just a vehicle for the appreciating property prices? Or are they much more popular than I thought? Or am I missing something else?

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I've co-owned a small co-working space for about a year now. It's been a good decision, financially. Nothing extravagant, but I certainly have no regrets and I'd invest in another if the opportunity came up.

One thing that I think helps is that historically, consulting rooms have been a big desk in a 4x4m room with 1-2 client chairs facing the tenant. In a co-working space, you could accommodate 3-4 desks/tenants in the same area, especially if you're open plan. Generally speaking, you can charge 3-4 people for a desk more than you can charge a single user for a room.

More business than ever is online, and shared boardrooms suffice for meetings, private client calls, etc. Most people now get by without loads of filing and other storage space so a fairly standard desk (smaller than what we used 10-20 years ago) does the job.

May I ask where your space is located?

In South Australia (links to it via personal site linked in my profile). 13 desks total, but we're currently fully tenanted.

Recall how McDonald's is more of a real estate company than a restaurant company. Owning the land which is then leased out to franchisees isolates failure with the franchise's owner while funneling franchise fees into buying more real estate, which creates a positive spiral whereby the value of McDonald's is always growing because the it keeps adding more and more lands as assets.

If WeWork buys real estate to operate co-working quasi-franchises on that real estate, and uses the profits to fund further asset acquisition, then that's a pretty similar model.

This comes up every time WeWork is mentioned, but their model is literally the opposite. They take leases on commercial space long term and then arbitrage short term. Meaning they lose out on massive gains but are totally exposed to a downturn in demand for the kind of space they provide.

They are riding the current bubble, and momentum investing is solid cash. It seems like they want to be Levi's, using this gold rush to do rapid customer experimentation and then commercialize those gains over the long-term. Diversifying the possible uses of their space via MeetUp is at least a step in that direction.

I gave up on coworking early this month. I've been using a coworking space for nearly 2 years, tested out various spaces and realized that they're just bad for productivity.

Far too many people at coworking spaces seem to be there for networking, or are simply not serious enough about work.

I moved to a 'business center' (like Regus) which has a much quieter and more professional environment. Couldn't be happier.

I have found that a really good library is typically a much better work environment than these coworking spaces, and at 100% less the cost.

I tried Regus for a couple days, but it felt no different to me than a coworking space. Maybe it was that particular Regus location.

Libraries are great places to work from! Typically quiet, good internet, nice people, and many larger ones have rooms you can sign out or rent for meetings.

Yes! Whenever my wife and I have spent large amount of time at her mother's (where there's effectively no internet due to being so far out in the boonies), I'd drive the 10 minutes to a nearby library in town that actually had a decent connection, and would work from there.

Only issue was the dearth of areas to take calls, but even that was only mildly inconvenient, since I'm usually on mute, and could duck outside for those.

Every library I've been in has had a few small spaces available for reservation for maybe 2 hour blocks. They're sometimes kinda hidden though, and sometimes first come first serve, so not always what you need.

With Regus, it seems it depends a lot on the location and how it is being managed. I've had different experiences in the same city.

The good part is that they have a lot of locations.

I'll be very happy to pay a premium for a quiet working space, even sound proof where I can work alone in peace. I wonder if there are any startups tackling this need

I had a good experience with Regus in Kuala Lumpur. However in Barcelona they really nickel and dimed me. Worse though, we had to pay per device for Internet connectivity - and the Internet was subpar.

I don't think they buy all their property. In Boston they have four locations and are planning a fifth but they're all rented / leased from property mgmt firms.

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