WeWork’s Annual Loss Doubles to Nearly $2B Amid Rapid Expansion | Hacker News Reader

WeWork’s Annual Loss Doubles to Nearly $2B Amid Rapid Expansion

wsj.com

142 pointsJumpCrisscross101 comments

I'm seeing a lot of people in this thread balking at the $2B in losses. The thing is that aggregate profit is a terrible metric for measuring companies that have a recurring revenue model with high upfront costs (as WeWork, Uber, and many other tech startups do).

The reason for this is profit doesn't factor in investments. Let's say I invest $1200 to acquire one customer who pays me $100/month. If you look at month 0, I have -$1200 in profit. At first glance, this looks really bad. Alternatively, you can see it as I am now making $100/month. Because of the $100/month, after one year I'll have made my original investment back and still be making $100/month. After two years, I'll have made a profit of $1200.

This is probably exactly what's happening here with WeWork. If you look at things in aggregate, WeWork is spending a ton of money investing in opening new offices while they make a much smaller amount of money from their old offices. This makes them look like they are lighting money on fire. In reality they are investing their money in new offices and expect each office to make a return on investment over a few years. As long as they are spending more money investing in new offices than they are making from the old ones, they will appear unprofitable.

For a typical software business, a pair of metrics that are much better than profit are CAC (cost of acquiring a customer) and LTV (the life time value of a customer). As long as a product's LTV is sufficiently greater than CAC (a successful SaaS company typically has LTV > 3 * CAC), it makes sense to invest more money into the business.

This For Entrepreneurs post goes in great depth about good ways to measure a SaaS business and gives you a few models you can play with: https://www.forentrepreneurs.com/saas-metrics-2-definitions-...

Now all of this doesn't mean that WeWork is a healthy business. All it means is that we can't tell based on how much money they are losing alone.

How does it factor in that they are leasing their buildings? Won't their rents eventually go up, and won't they have to remodel all the time to keep up their hip/modern work spaces? It seems like funky math that I'm not understanding.

Also, when a recession hits, it seems like the first offices a company closes has are the ones on a short-term lease at a co-working space....

[Edit] My second comment is because I work for a large company who opened an office in a WeWork space to be more hip and relevant....and I see a lot of other "big" companies with offices in the building.

Definitely not a WeWork booster, but I think I can see the other side of these questions.

> How does it factor in that they are leasing their buildings? Won't their rents eventually go up, and won't they have to remodel all the time to keep up their hip/modern work spaces?

All of this does matter, but per the OP may matter less than CAC + initial push into a market (brand-building etc.). Think of the cost to develop e.g. MS Word vs. the incremental cost to retain users (programmer salaries go up over time, they have to remodel the app ~annually, etc).

If the WeWork model works in a market, they can buy buildings later (perhaps during a recession).

> when a recession hits, it seems like the first offices a company closes has are the ones on a short-term lease at a co-working space

I'm sure the other side of this argument goes something like the arguments against car ownership. Many companies won't have any long-term leases anywhere, will be more remote-friendly, etc. In fact some companies will choose to not re-up on long-term leases in favor of more flexible options like WeWork specifically because who wants to sign a long-term lease during a recession when visibility is poor?

Good points. I do think car ownership might be different because it's a depreciating asset with a limited lifetime of use. I think real estate and buildings, that lifetime can be significantly longer...

It'll be interesting to see how this all works out for a lot of this generation "tech" companies.

>Also, when a recession hits, it seems like the first offices a company closes has are the ones on a short-term lease at a co-working space....

Apartment rents spiked during the last financial crisis because people downsizing increased demand for them. It's entirely possible that downsizing companies might want to retreat from leases to smaller WeWork offices during the next one.

Aren't commercial leases typically of much longer terms than residential leases and less convertible than homeownership?

Great post. In a recent interview this is exactly what Masa Son is talking about: https://www.youtube.com/watch?v=eDpdcWz_F_0 What I don't fully understand - isn't this covered by GAAP accounting in some way?

GAAP does cover this. Your "high upfront costs" would be capitalized. It wouldn't appear as a loss.

It depends on what kind of costs are we talking about. If it was something like "I give one year for free to get the client, and I will make money from them in the years to come because of course there is no reason to think they may switch providers later" I don't think it will be capitalized.

Usage of GAAP is entirely up to the company. It might choose to not use GAAP policies on revenue recognition and expenses. Many non-public companies chose to do that if it means they can show their revenues growing faster than it actually is.

One of the example of this was Groupon. When they filed for IPO they were using gross sales as their revenue. And then deducting money paid to their partners as expense. SEC had to step-in and ask Groupon to restate their P&L statement so that the top line was net revenue instead of gross.

Conflating WeWork, Uber, and SaaS businesses is inaccurate.

With a SaaS business - most of which are b2b - there are tremendous costs to switching providers and going without is typically not an option. For example, if company uses Salesforce, they must have a CRM and it will likely save them little to no money to switch to a competitor (ex. Hubspot) but it will create enormous organizational disruption as people and processes are built around the existing platform. So customer life-cycle is likely 10 years or more for the customers that generate the majority of their revenue. And if we do have a recession and they bleed customers, Salesforce can always reduce costs by cutting sales and support staff. The existing capital investments in the software are already paid-off.

In comparison, WeWork's model is predicated on being easier to join and leave than a typical office space. As a result, they attract businesses with shallower capital reservoirs. Meanwhile, WeWork is holding inventory risk in that they hold the long-term lease or the property itself. So in the event of a recession their customer base will be the first to die out or cut costs via less desks and/or working from home.

(WeWork may or may not be off-setting this risk via financial engineering but the question is at what cost as someone has to take the other side of the bet and the downside risk here is pretty obvious. And, oh look, the yield curve just inverted.)

Finally, 10 years in, Uber is still a commodity business. I generally think Uber is better than Lyft and worse than Via, but none of their advantages are anywhere near as durable as a SaaS business. Don't like Ubers new prices? Don't like the the CEOs new haircut? You can use one of their other competitors starting tomorrow. Even if you use Uber today there is zero reason you can't switch to Waymo/Apple/whatever in the future. And in the worst case scenario, Uber paid CAC to educate consumers who will use something else in the future.

Uber has network effects. It's definitely possible and inevitable even that they won't be on top anymore at some point, but what they are doing is not exactly a commodity if it relies on a dense two-sided marketplace.

While it does have network effects, I'd argue it's not recession proof (mildly cyclical, even), and there's low switching costs to using other forms of transport (for example, I haven't used Uber in lieu of Lyft / driving my own car and had no issues)

Uber has shown great growth in markets during recessions: ex Brazil. The theory is that ridesharing is a driver constrained market, and during recessions, more people drive for uber to make ends meet. Also, people invest less in large purchases (cars) and instead spend more on services with a higher marginal cost (taxi, ride share.

Agreed. The business models and risks between these companies are completely different.

The main commonality I was highlighting was that these business have high upfront costs and make the money back over a long period of time. Because of this, profits are a not very good way to measure the health of these businesses.

WeWork is aggressively buying out the good spots. They're going for a limited resource before competitors can, and unlike software, the entry barrier is just money, brand, and interior decoration skills.

Monopolizing available office space in a large city is a tall order though. But they might be able to be the coworking Walmart and drive the Mum and Pop stores out of business, through sheer economies of scale.

Oh right, I was comparing to my own city, where is a fight for the best office spaces. It might not be the case in New York City, but would make a huge difference in, say, Sydney or Kuala Lumpur.

I believe once you start hitting the 8 to 10 people, WeWork makes you sign up for a 1-year agreement since it's more difficult for them to find new occupants for those spaces. Not sure about the exact number as it may differ per location.

As for signing/leaving leases, the experience is comparable. You can leave any lease if you're willing to pay the penalties defined without much of a hassle. Usually, the hassle has to do with the renegotiation of the terms. But I do agree, WeWork has been more flexible about breaking the initial agreement.

I’m not an accountant so I’m not sure if there are specific rules that would make this not applicable to SaaS, but the thing you describe is precisely what proper accounting is designed to solve. If you buy a factory this month and then use it to make widgets for the next 10 years you don’t show a huge loss when you buy the factory, but rather capitalize the cost and then depreciate it over the useful life of the factory so that in every period you can match the revenue with the associated costs. Shouldn’t customer acquisition costs be similarly capitalized over the expected life? If the company is actually profitable then it should show a profit not a loss. Any reason why this isn’t more common among SaaS businesses?

The big difference between a factory and customer acquisition costs is that the factory is an asset. It has enduring value. Customer acquisition costs do not. When you pay the customer acquisition costs, the money you spent is gone and non-recoverable. But you can recover some of the value of a factory by selling it.

Plenty of things you can’t sell get capitalized, recoverability isn’t a particularly important aspect for capitalizing something.

At least under international GAAP, assets can only be capitalised if they are expected to deliver future economic benefits. This doesn't mean that they have to be sold directly - they can be internal benefits such as a building or a factory machine that makes it cheaper to produce goods.

Indeed, that’s what I was trying to say as well. The asset needs to have value to the firm in terms of future benefits but doesn’t need to be sellable on its own.

How would you deal with spending a bunch of money on redesigning a company's website (in practice, as opposed to in theory)? On the one hand it has a lot of similarities to making improvements to a retail location (which would typically be amortized). On the other hand, my experience (not as an accountant, but as someone who has been exposed to accounting in small business contexts) is that that would typically get booked as an expense.

It would be capitalised as an intangible asset. In practice I assume a small company might not bother, especially if the website was built by their own staff, but the clients I worked on seem to get charged quite a lot for outsourced IT work so they would certainly want to capitalise it.

I'm curious if you have any examples off the top of your head. Not trying to be combative, but I'm genuinely drawing a blank here.

Why isn't a customer who pays $X/month an asset? If you purchase a bond that paid the same X/month in interest, that would certainly be considered an asset on the books.

As an accountant, I can tell you that the accounting standards do require certain things to be recognised once they become more likely than not (e.g. provision for expected losses) but this is not extended to e.g. recognising customer relationships as an asset, mostly because these things are fuzzy and hard to measure and easy to game.

If the company buys another company then they can recognise the difference between the purchase price and the company's assets as a new asset vaguely named 'goodwill' which covers things like customer relationships and everything else the accounting standards otherwise miss, but this isn't allowed otherwise.

It is actually more common among SaaS businesses than you think. If you look at balance sheet from Salesforce etc, they tend to have items called "deferred commission" or something similar which are captialized marketing and sales expense.

A more succint way of explaining it is that WeWork is just a real estate company, and real estate is about achieving positive cash flow (rental income > lease or mortgage expenses), not "profits" since a lot of the profit comes from selling the appreciated properties down the line.

I believe WeWork leases their properties, which would make near-term profitability important.

Investments are not part of your operating income. Your income only consists of flows that accrue over time. If you make a $1200 investment, the expense associated with the investment is accounted for by spreading that expense over the lifetime of the asset. For a 20 year asset, this would become a $60 expense per year.

It's not like it's a new thing that businesses need to invest to to acquire customers. The entire science/discipline of accounting exists to provide accurate metrics of business performance. Its ridiculous to say that "profits are a bad metric" because of this.

Also, WeWork is not a software business, since they do not sell software. Why would those metrics apply here when all their money is made through leasing office space?

That’s the purpose of accounting in principle, but in practice GAAP financials are an incomplete measure of financial performance. In the instant that WeWork acquires a new customer, it realizes no additional income and no change in shareholders’ equity. But assuming its marginal revenue is higher than its marginal cost, the expected present value of its future profits is certainly higher than it was the instant before it acquired that customer.

I may be wrong but I don't think that last statement is true if the lifetime of the customer/asset is short--especially shorter than expected. The business model seems too new and for me it hasn't proven itself viable.

You’re right. Replace “marginal revenue/cost” with “marginal expected present value of lifetime revenue/cost” and that statement holds.

In the immediate instance, no, WeWork does not recognize anything. But in its first month, rental income should exceed the month's depreciation for the same real estate. The fact that income has not kept up implies that occupancy is low. WeWork is fundamentally a real estate/leasing company, not a tech company.

> In the immediate instance, no, WeWork does not recognize anything. But in its first month, rental income should exceed the month's depreciation for the same real estate.

This is accurate.

> The fact that income has not kept up implies that occupancy is low.

This is inaccurate. (To be clear, occupancy may be low, but WeWork's reported losses don't imply that that's the case.) If WeWork turns around and spends that rental income plus some of its investors' capital on customer acquisition expenses, it will report losses, even if those expenses bring about a net increase in the expected present value of future profits. This is just a result of the timing difference between the recognition of acquisition expenses and the revenue that they produce.

Why do you think Uber has a high customer acquisition cost?

> For a typical software business, a pair of metrics that are much better than profit are CAC (cost of acquiring a customer) and LTV (the life time value of a customer)

Andrew Chen, ex VP Growth at Uber, had a blog up on just this: https://andrewchen.co/how-to-actually-calculate-cac/

Without looking at the actual accounting rules (GAAP or otherwise) used by WeWork it is difficult to say how the line costs are treated.

In your example, you have treated $1200 as an expense.

Lot of companies tend to capitalize these expenses (for example "deferred commissions" on Salesforce B/S). So, they will create a reserve on the Balance sheet of $1200, then decide on the useful life of the said expense and depreciate it on the P&L.

Let's say WeWork thinks the useful life of the $1200 expense is 24 months. The calculation will work like this:

P&L

Month 0: Depreciation Expense 0, Revenue 0 and Profit 0

Month 1: Depreciation Expense $50, Revenue $100 and Profit $50

Month 2: Depreciation Expense $50, Revenue $100 and Profit $50 so and so forth

Month 0 - Asset $1200

Month 1 - Asset $1150 (Depreciation $50)

Month 2 - Asset $1100 (Depreciation of another $50)

The issue I have with WeWork, aside from the fact that they're somehow a tech company, is that they have competitors that does the exact same thing... but who are profitable.

You have a company like Regus, that's not a tech company, they have a MUCH low evaluation, but makes a profit and having more offices.

My understanding is that they make some bullshit claim about how they have instrumented everything and that helps them to apply machine learning to their community and app, blah blah. It's def not a tech company but I could see them going that way eventually.

BTW - the concept is "valuation", not "evaluation" :)

> BTW - the concept is "valuation", not "evaluation" :)

Oooh... thanks. This is one of those cases where I suddenly realise that I've been using the wrong word for year :-|

Only the truly innovative can lose money by being landlords.

Curious if they are even landlords. Aren't they just subleasing, such that no equity (of theirs) is being paid down? Or do they actually own the buildings?

It’s the corporate version of what many small individual real estate investors were doing in the lead up to 2008.

If you hold the master lease on a space with the intention of subletting, you are a landlord. We can even argue about whether, under a triple-net lease, the owner or the tenant has more skin in the game.

I mention it because it's notable that they aren't gaining equity whilst losing cash. Just losing cash.

And this comment is worth looking at: https://news.ycombinator.com/item?id=19488219

In common law, for historical reasons, leases are recursable.

That said, the basic mechanic has been the subject of substantial legislative tinkering in pretty much every common law jurisdiction in the world.

The CEO is in a great position!

https://www.wsj.com/articles/weworks-ceo-makes-millions-as-l...

The Trump playbook.

Turning billions into millions!

Turning billions of other people's money in millions for yourself is not that bad (for you).

I’m getting paywalled but from the small blurb I’m reading that seems pretty fucked up. If you were a smart investor you wouldn’t give him the explicit green light but instead use it as a hedge the business fails so you can sue him for embezzlement

This is what really confuses me. If the business is successful, this bullshit will be small beans and his wealth in wework will make him incredibly wealthy. So there's no upside to doing this if the business succeeds.

If the business fails, not only will he have no wealth from the company, you know sure as shit someone will come after him for these shady practices, putting him in extra trouble.

No. No one is coming for him. And we all know it.

I don't think they own most of their locations. They're just leasing long-term and subleasing short-term.

Things have gotten a little crazy in late-stage "tech" companies. I mean, I understand that some companies need to grow for years before they can become profitable, and until then, investors can be OK with your losses growing.

But there are too many of these types of companies. It doesn't make sense. You've got Lyft, Uber, WeWork, and probably a whole host of others who have kept their financials close to their chests.

Maybe one or a couple of these companies figure out how to turn a profit that justifies these losses and valuations. My guess is most of them won't. I only wish I could confidently say which is which.

Hoo boy, you should've seen the kinds of "businesses" during the Dotcom boom-bust cycle. :)

I’m confused, why would they sell large portions of equity (for billions) if they didn’t plan on spending those billions? So by definition any company that raises billions is planning on being unprofitable (by billions) or they wouldn’t raise money right?

Companies don’t sell equity for fun, they only do it if they have no other choice (they aren’t profitable yet, or they plan to become unprofitable due to new expansion. For the latter they may be able to raise debt instead of venture capital investment) right?

They don't think it is worth billions or that their value would drop perhaps?

I honestly wouldn't be surprised if WeWork did that just to cargo-cult a successful company.That or it involves a plan of "playing dress up as a successful company" given the sheer "B ark feel" to the place. Other plausible explanations are that WeWork is an embezzlement scheme, fraud, or money laundering operation since nothing about the place makes sense.

This isn't really news. Basically WeWork have just expanded to a lot more locations. 105% increase in revenue, 103% increase in losses. So essentially they're keeping the same revenue, same costs at a larger scale. So the message here is really that they're continuing to execute to their plan- fast expansion. At some point they're going to need to turn all this into profitability, but they're not actually planning to do that right now, so there's no point in judging them for failing to be profitable since they aren't trying.

They seem to have plenty of cash on hand (1 year runway in cash plus much more available from softbank). So the losses really aren't a problem.

Another thing I've heard is "But during a recession their long term rents will eat capital and demand will collapse". But that might not be true- it may be that they have deep enough pockets to weather a recession, pick up new cheap property in long-term agreements and gain customers. Hear me out: Maybe they can make a play during the recession that their short-term flexible leases are low risk for clients during a recession making them a great choice. It would mean they come out of the next recession with great market share and then can focus the next business cycle on starting to squeeze out those profits.

I've got to admit I actually believe they could get to profitability - but the only way I see is by growing to a size where they can drop prices in local areas to force out competition and charge monopolistic prices elsewhere.

"so there's no point in judging them for failing to be profitable since they aren't trying."

Point taken, but, we can definitely 'judge them' in the case of unit profitability.

Expansion is one thing, it's loaded with startup costs for each unit - but the key is, 'are the long running installations running at unit profitability, even when accounting for corporate overhead'.

That's the first order thing we need to know, because if not, then it's a problem because the only way to make more money would be to jack rent or cut overhead, neither good options.

The other thing is of course the inherent risks in their contracts. Are their margins so thin they can't withstand a real-estate shock? What happens when there's a down cycle and they have a lot of empty space? Are their contracts subject to flexibility? Or are they toast? Surely, they're 'always room to negotiate' because if there is a downturn, their landlords will get it on some level and rather WW stick around than have an empty building, but there might not be enough room to manoever given possible overhead of running the place + corporate overhead.

And lastly is the sustainability of their advantage. Do people really like the WW brand that much? Or are they betting on juicy corporate contracts with fat margins they can sink their teeth into like Oracle.

I think that's where the bulk of the material grey areas reside.

I have used WeWork couple times and not impressed. The amenities are minimal. Some of the basics in the building are filmsy and are not even completed. The toilet paper holders are not securely screwed in and would come loose with the slightest shake. There are no toilet seat covers in half of the bathroom. The place is 90% empty. Not sure how they can sustain.

dude, why were you pulling on the toilet paper holders?

I was pulling on the toilet paper and the holder came off from the wall. And it's not an isolated incident. All the single room bathrooms have the same poor workmanship.

I've written about my poor experience with WeWork before, and I'm too lazy to repeat it again.

But in simple terms - they suck, they're loud, and I'm pretty sure the company will tank in the next few years.

I agree their hot desking sucks. But as a two-person team in Berkeley looking for our own dedicated space, WeWork was a godsend. There just isn't any office space like that around is affordable for < 6 person teams.

For low $1000s we have a fully sealed glass room with a door and an amazing view just a few blocks away from a BART stop. Comes with a chair, desk, coffee and basic office amenities. The next best option was a crappy art studio with one window way out in the middle of nowhere. Sure there's better spaces but nothing that's even close to what we could afford as a small startup.

Barcelona has loads of startups as well as lifestyle creators, both big customers of such spaces.

WeWork is struggling with its position. On one hand, cool kids want a cool coworking space that's super central and with a lifestyle crowd (OneCowork in Barcelona). On the other hand, more serious people want a very functional office space without the cool factor, Regus.

No idea in the US but here in Barcelona, WeWork is too much in the middle.

The WeWork I'm in was 30% occupancy for the first 4 months it was open... then literally overnight it jumped to 90% because a couple big companies came in and took over an entire floor and blocks of offices on another floor. In 24 hours I went from a WeWork skeptic (for good reason, they acquired my company and I chose not to stay on) to cautiously optimistic that my stock may be worth something some day. Who knows how it'll play out in the end but they do provide a product people really want and that's worth something if they don't run out of money before that happens.

With the recent yield curve inversion, I think the writing is really on the wall right now for a lot of startups/tech businesses.

Typically the inversion to watch as I understand is the two year and ten year, which has not inverted (yet).

Two-year and five-year are inverted and 10-year is flat

https://www.treasury.gov/resource-center/data-chart-center/i...

3m/10y inversion is a better predictor of recession than 2s10s, and it recently inverted.

[0] https://www.frbsf.org/economic-research/publications/economi...

Here in LA, I've found a couple incubators that offers beautiful co-working space, and also provide a far better value than WeWork when it comes to connecting with people. It seems to me the Airbnb of work space is the future, and not WeWork.

I would be interested in hearing your recommendations for incubator spaces in that area. Thanks.

For one, if you are in a health and wellness space, there is this co-working called ScaleLA.com. Pretty awesome to work with people working in the same space as it creates a form of synergy.

What I've noticed is that a lot of WeWork's business is largish companies that have a very small sales or support presence in probably a number of cities. WeWork is logistically attractive because it's totally uniform across the country. It's very easy to grow and shrink an office as well. For companies that might fly in a team for a couple of months to stand up a new customer and then move on, it's perfect. I notice that many of these offices are empty during the day.

I see. I guess that is why they are hemorrhaging so much money.

This is exactly what I'm seeing in my WeWork building.

I'm at the WeWork in downtown, used to work at the CTRL Collective nearby before it got closed. Any advice? My WeWork is OK, but I'm always looking for a better deal.

They are literally losing more than a dollar for every dollar in revenue.

At their age and size that’s both beyond insane and far outside what could be reasonably deemed “expansion costs.”

Yes, but they would argue: Where else can you find a "space to elevate work?"[a] A space that "has the power to transform business -- unlocking the potential of people and organizations?"[a] A space "where company becomes community?"[a] Clearly they believe they offer something new and unique.

Worst case, they can always try making up for the losses with greater volume.

[a] Quoting directly from https://www.wework.com

WeWorks are so loud. I have no idea how people work there

That's one way to encourage people to upgrade to private office. I just put on a headphone.

3M Peltor X5A ear muffs. When I ordered them from Amazon, I actually had to accept a click through agreement that said that I was a professional. I thought about it for a second and decided that yes, I am a professional.

Check out the 3M Peltor Optime III Earmuffs

The X5A's are 31dB reduction, the Peltor Optime III's are 35dB.

Edit: I was wrong, the X5A's are a bit better for reducing human speech than the Optime III (Optime 105)'s.

https://remembereverything.org/my-top-6-noise-blocking-earmu...

Given the weight of the Peltors (15oz) I'm going to look at the behind the ear version. For the Peltor, that's the X5B. The Optime IIIs are also a little lighter (11.4oz). This review says the III is the same as the 105.

https://remembereverything.org/my-top-6-noise-blocking-earmu...

We were in a private office and it was still loud whenever the people in the next office played music, someone walked down the corridor, people were having a discussion in the kitchen, people in the large unroofed office downstairs were loud, or when the mysterious noise in the roof kicked off.

Now we're not in a WeWork and it is blissfully quiet.

As a developer, I agree completely.

As a person who used to do business development kind of stuff, it's a completely different mindset with very different tasks, and loud office with a lot of things happening around you weirdly fits it very well.

What kind of services do they offer besides leasing office space?

Their value is that they "hipsterise" the location.

Add a ping poll table, stock a fridge with free beer and invite meetups/incubators to hold their events there.

Overpriced living accommodations and gym memberships with a forced vegetarian diet thrown in for free.

They bought meetup.com which charges a yearly fee for running clubs. Its is actually a decent platform for a lot of things, and charging helped reduce the spam you got by having an account. But its hard to compete with free sometimes.

I've been to Meetups at the WeWorks in San Jose and Berkeley. I couldn't imagine working there.

By leasing office space from wework you become part of the In Crowd

From what I could see when a friend who had set up there dragged me along one day, top knots and brogrammer wantrepreneurs. The feeling I got was that it's the shared workspace version of a "see and be seen" restaurant/club/whatever.

Pretty cringeworthy.

I looked at the prices for the spaces and it is quite high.

The coffee is pretty good. Um, and kombucha on tap?

Is it possible its just not a profitable business unless they double the rent?

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