WeWork’s unprecedented valuation, driven by gargantuan investments from Japanese conglomerate SoftBank, has created a schism in the proptech sector, where some reject the premise that the startup is a tech company at all, and therefore should not be valued like one.
“At its core, [WeWork] is a property company, not a tech company,” said Jeff Berman, a general partner at Camber Creek, a venture capital firm that has invested in more than two dozen real estate tech startups.
“There are a small number of WeWork investors to whom a valuation of low $20 billion would be upsetting,” Hodari said.
Common’s Hargreaves dismissed the notion that a drop in WeWork’s valuation would affect his company’s value.
There are plenty of reasons for investors to be wary of tech startups with high valuations.
Each have valuations akin to tech companies, which typically achieve high valuations due to a combination of limited costs and the prospect of mass-adoption.
The company, which this week announced two new acquisitions, declined to answer questions about whether changes to WeWork’s valuation would affect its own.