Morning Report: WeWork has raised hundreds of millions of dollars. Again.
In news that should be surprising, but isn’t, WeWork, the popular co-working startup, has announced a new $500 million capital investment into Asia.
As TechCrunch notes, however, the move follows a separate $500 million capital raise by the company. The coworking startup is not pulling from its last $500 million raise to fuel this new investment into Asia. Instead, it appears its latest $500 million raise is also new capital. WeWork, according to its Crunchbase profile, has already raised around $4.5 billion in equity funding alone. This additional sum raised likely puts it over the $5 billion mark.
There are various cliches concerning getting things done whilst you can. Make hay while the sun shines, intones one. Get it while the getting is good, says another. WeWork has taken the concept to hand—almost to an absurd degree, perhaps.
Here’s TechCrunch’s Connie Loizos on the latest:
The amount of money that WeWork has raised this year is astonishing. In addition to the $1 billion it has announced in the last two weeks, a Delaware filing had surfaced in June, showing that WeWork had closed on $760 million in separate funding. WeWork also raised $300 million in March.
The sums of cash that investors are willing to put into WeWork to put to use is simply staggering. The company has raised at least three times what SpaceX has, according to their respective Crunchbase profiles. This appears odd, as Elon’s company makes space rockets; meanwhile, WeWork runs an at-least-partially-asset-light coworking business.
But such are the times we live in.
This weekend, I re-read the excellent Mark Suster — he’s a venture capitalist and former entrepreneur — piece entitled “Why I Fucking Hate Unicorns and the Culture They Breed,” which I think applies here, at least in part.
The essay is a jeremiad of sorts, ranging from unicorns to bandwagon-hoppers to politics to a great quote from a piece about losing weight. But it’s mostly about being real and doing the work. From its concluding sections:
If you’re fortunate enough to raise $100 million early-on to build your startup — congratulations. But to all of the 99.999% of other startups out there please know that this isn’t the success by which to measure yourself. Measure yourself in gym visits, in 3-yard gains, in sacrifice and dedication. Avoid the metaphorical parties and the alcohol and the extra pounds and know that your gains will come in lines of code and purchase orders and signed offer letters and repeat purchases.
I can’t help but look at the mega rounds of the current tech cycle as the sort of shortcuts that Suster hates. (In related news, have you seen what bike-sharing companies are raising? The world has lost its damn mind.)
Of course, some of it won’t work. But what we can see from today’s WeWork news is that, despite endless warnings, including the 2015 Suster piece and the various responses — guilty once, twice, thrice — to the Gurley bent, things are chugging along as they were.
From the Crunchbase Daily:
SoftBank’s Son to invest in Uber…or Lyft
- SoftBank CEO Masayoshi Son told investors that he wants to invest in either Uber or Lyft as part of the firm’s strategy for the U.S. ride-hailing market. Son’s statement comes amid a period of high-level flux for Uber, which is still without a CEO as founder Travis Kalanick reportedly explores ways to reassert control at the company.
Tesla raising $1.5B as broader EV funding contracts
- Tesla plans to raise about $1.5 billion in a bond offering as it ramps up production of its newest sedan, the Model 3. Yet while Tesla appears confident in its ability to secure funding now, the broader EV startup scene has been seeing declining investment, according to a Crunchbase News analysis.
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