Business Startups

WeWork Reduces Costs And Plans For The Future

Morning Report: Workspace-as-a-Service company WeWork claims revenue of $900 million in 2017 with reduced build-out expenditures and hefty goals for expansion.

WeWork wants you to know that it is working to control costs. According to a report by Bloomberg released yesterday, the company has decreased per-desk expenditure from $14,100 to $9,500. Furthermore, the company emphasized that its global brand name and sheer size has allowed it to leverage its supply chain to drive deals by buying in bulk.

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According to Crunchbase, the company has raised a total of $6.9 billion inclusive of secondary transactions, with the majority of that funding sourced from its $4.4 billion investment by Softbank announced in August 2017. A large chunk of that funding is to be directed toward WeWork’s global expansion in Asia, including its WeWork China, WeWork Japan, and WeWork Pacific projects.

In December, Crunchbase News took a look at WeWork’s expansion projects as it began to build out its community vision. That vision has since included its WeGrow project for teaching entrepreneurship, its dormitory-like WeLive initiative, as well as its recent acquisition of Meetup for $200 million among other investments.

According to the Bloomberg report, the company had revenue of around $900 million in 2017 and aims to start 2018 at a $2.3 billion run rate pace. The company has no immediate plans for an IPO.

The Bloomberg article also stated that the company “declined to say how much it lost last year, though the company said it would be profitable if it didn’t count ‘growth investments,’ such as entering new markets and developing new products.” That’s an odd statement for a company largely valued on its ability to grow.WeWork’s main public competitor competitor IWG (formerly known as Regus) had a reported revenue of $3.2 billion, with a valuation less than nearly 7 times the size. According to the Bloomberg piece, WeWork has defended its valuation by touting its brand. The company also posits that its name and size are enough to give it a hand up in the industry.

From The Crunchbase Daily:

PhishMe acquired at $400M valuation

  • PhishMe, a startup that helps companies train employees to avoid phishing scams, is selling to a consortium of private equity investors in a deal that values the seven-year-old company at $400 million. As part of the deal, PhishMe is changing its name to Cofense.

Industrious raises $80M for coworking

  • Industrious, a provider of coworking spaces and flexible-term office rentals, has raised $80 in a Series C funding round led by Riverwood Capital and Fifth Wall Ventures. The new financing brings total funding for the five-year-old WeWork rival to more than $140 million.

Microsoft Supreme Court case may impact startups

  • The U.S. Supreme Court will hear oral arguments from Microsoft in a case touching on how it and other companies handle user data stored overseas. The outcome will affect how many of the cloud platforms popular with startups can treat private user data.

Job site Glassdoor eyes IPO

  • Another unicorn may be going public. Glassdoor, a site for finding jobs and workplace reviews, is reportedly interviewing banks for an upcoming public offering that could come as soon as this year.

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

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