WeWork looked set to become the latest tech startup to launch on the stock market at an astronomic valuation.
Following the recent collapse of Uber and Lyft shares after their initial public offerings potential investors in WeWork will have some valid questions: how much is it really worth behind the slick marketing? Will it be successful in the long run? Many industries disrupted by tech newcomers have historically been highly competitive or prone to cyclical demand.
A big question surrounding WeWork is the extent that it is really a technology business, as it bills itself to be, or simply a space rental business.
There’s a WeWork app through which short-term office rental can be booked, starting at around one month for a desk, office, or space.
WeWork in Washington DC. Ted Eytan / flickr, CC BY-SA The risk WeWork takes is that any collapse in demand will see them struggle to pay their landlords.
Because WeWork offers short-term contracts, it is easy for tenants to move elsewhere if a better deal comes along.
Even if we were to consider WeWork a tech company, it isn’t the same as the big companies above.