And the company now seems to be valued as a real estate -- not a "tech" -- business...
...which makes sense, because WeWork is a real estate business, albeit one with an unproven model.
...which makes sense, because WeWork is a real estate business, albeit one with an unproven model.
They’ve moved the cold brew downstairs so there is only one tap instead of two and replaced it with a much lower quality cold brew (the old one was extremely good — from a super high quality local source)... it’s small but feels like it’s probably the beginning of what is likely to be a long quality decline ...
Probably a joke in there about Shiner Bock too.
The model works, if the short term leases balance out the long term leases and other costs.
Have you ever been to a Regus? Most souless depressing places on earth.
WeWork was substantially different in quality.
OTOH, it could be because of all the fun toys that they attract that crowd.
Much like we now have up-market coffee shops. It's not innovative, just a perfected execution of an existing idea.
Starbucks built an empire on the unserved masses of people who (1) wanted to be people who went to coffee shops & (2) were scared to go to actual independent coffee shops.
It seems a good path for WeWork to follow. Lower costs and broaden appeal, just enough to cater to people who won't use Regus.
Nobody's 'scared' to go to an independent coffee shop. This is a ridiculous snobby notion.
McDonalds makes terrible beefburgers too, but they're doing just fine.
Regus being bland is probably something they consider a commercial edge tbf.
Uber was amazing in the early days, the cars were better than taxis, I remember getting driven around in a Mercedes and not having to pay a premium for the nicer car. And there were cars always available, because the drivers were getting good money for every ride.
It turns out that these nicer features weren’t a consequence of software and maps and efficiently matching rides with cars, it was as simple as raising billions of dollars, and running the business at a loss.
I suggest it’s the same with WeWork. Their nicer offices weren’t a question of vision or aesthetic taste or efficiencies from technology. They were nothing more than spending Softbank’s billions of dollars and running at a loss.
I accept that you feel they were offering a higher-quality experience, but we have to come to grips with the fact that it was an illusion. They were never going to magically reach enough scale that they could break even or make money offering that service at that price to that “demographic” of customer.
I feel like WeWork is in some way in a worse situation than Uber, DoorDash, and other “gig economy” businesses. Those businesses can squeeze their employees (that they classify as independent contractors in order to maximize the misery they can inflict).
Who can WeWork squeeze? Nobody. The gig economy is nothing more than rolling back any and all protections for workers, but dressing it up as technological progress.
What is WeWork’s story? There’s nobody to squeeze, no regulations to flout in order to cut costs. There’s no inefficiency that iPads and WiFi and digital services get rid of.
So naturally, now that the money hose has been turned off, the squeeze is on WeWork and its customers.
Before I'd never consider going to a co-working space. Might as well go and sit in a grotty cupboard. Now I'm inspired to give it a go.
I already answered that - a pleasant environment - that's their competitive advantage. Regus aren't able (or don't want to) meet that part of the market.
By way of analogy, if we say that Amazon’s pricing is a “competitive advantage,” we can also explain what Amazon has done structurally that makes their pricing hard to copy. Anybody can set a low price on a product or service, but not everybody can do so and make money.
Same with WeWork. If a nice environment is a competitive advantage, we can point to something in WeWork’s structure that makes it difficult for Regus to duplicate.
If Regus can duplicate it without difficulty, then we need to rethink whether it’s an advantage, or simply something you happen to prefer, but doesn’t matter.
By way of a different analogy, consider free coffee in hotel rooms. Everybody prefers it, but for decades you got it in motel chains, but not from the big hotel operations.
Why idn’t they offer free coffee? Because their customers were actually corporations, and the things that mattered to corporations were centralized billing, locations close to airports and business centres, and so forth.
This allowed the big hotels to drag their feet on in-room amenities like free coffee or free WiFi. It wasn’t nearly the competitive advantage it appeared to be.
What’s easier? Regus learning how to offer free espresso and decorate their offices for the startup crowd? Or WeWork learning how to spend less money than it earns in revenue?
You can get meals that retail for GBP 8 using this service. So that's a 37% discount in an industry that is notorious for its tight margins.
My first thought when I heard of it was "oh wow, better sign up before their VC money runs out"
WeWork is also substantially different in price.
In London, WW is probably 2x the price of a Regus office, for comparable location and surface area.