Is This the Office of the Future or a $5B Waste of Space?
bloomberg.com>Many traditional real estate investors are perplexed by WeWork’s $5 billion valuation. With that kind of money, you could build the world’s most expensive skyscraper—One World Trade Center, which at 3 million square feet has roughly the same cumulative amount of office space as WeWork—and still have $1 billion left over.
I'm as dismissive of ridiculous startup valuations as anyone, but this seemed like a weird way to evaluate whether their value was justified.
For reference, here are a couple of other similar statistics:
* There are about 250M Apple devices in use (100M/yr * 2.5 yr lifespan). At 750B market cap, they're worth $3000 per i____ out there, or enough to buy every one of their users an iPhone and still have $500B left over.
* There are about 200,000 active Uber drivers, and they're valued at $50B. That's $300,000 per driver, or enough to buy every one of their drivers a Tesla and still have $40B left over.
Isn't the point that unlike high-end manufacturing or online marketplace technology, real estate is a commodity business with competition based on location and fit rather than brand, and owning the assets is where the safest profit is? ($5bn worth of real estate certainly holds its value better than $50bn worth of latest generation Teslas.)
I'd think comparing WeWork - a mid-sized player in a highly competitive workspace space - with the dominance of Apple and Uber is a little fanciful too. As the article points out, Regus (and the Workspace Group, and others) have been doing the same thing successfully on a larger scale for much longer, actually own many of their assets and yet still have smaller market caps. I'm not sure that beer on tap is that much of a defensible business model differentiator for WeWork...
I work from home... Its much nicer then that place, I dont have noisy people running around and talking on the phones all day, unlimited food and drinks all day, and i get to keep my stuff laying out on the desk without fear of it getting stolen or messed with!
I never understood why people who can choose to work from anywhere, choose to pay a monthly commitment to go to a co working space, instead of choosing to work in a low cost area where there money can go SO much farther.
As a mobile startup, you can opt to live outside of a major city being able to leech talent from the talent hub, and make your money go SO much farther.
I get depressed cabin-fevery if I spend many days working from home. Going to a cafe, outdoors, or any change of scenery generally helps. I think part of it is that I've officially married my relaxing escape from the office with all the bad features of the office, and that takes a mental toll after a while.
I know others that do, but salaried or not, I'm a 9-5er and I don't degrade my hourly rate by putting in extra hours unless they're absolutely necessary for an infrequent crunch. For me, seeing colleagues that put in 15 hour days at soulless BigCo detracts significantly from the bigger salaries they may be getting.
Making my home the office is no different from making the office my home, as makes it feel like I never mentally stop working.
Plus they have better chairs and internet than I'd care to buy
"Making my home the office is no different from making the office my home, as makes it feel like I never mentally stop working."
How quotable, I found it hard to separate work and home while working at home, took me a year to get it right, but after 1 year of doing so, I've found a few tricks and with a bit of discipline, I have been able to completely build a wall between work and home even though they are the same place. I will say it wouldn't have been possible if my boss didn't also work from home and encourage it. If my boss expected me to keep up with emails and phone calls after 5:30pm, I would probably hate the home office.
"Making my home the office is no different than making my office my home..."
Brilliantly said. Leave home for living your life outside of work. As much as I am my work in so many ways, being able to have a zone that is (usually) free of work is very important.
To me, anyway :)
I'm with you on working in a cheaper locale. You lost me at working from home all the time. I'm guessing you don't have kids?
I've got a 2-year-old and my successful founder friend has two under 4, we both WFH full time. Although I think he has a co-working space within biking distance in case he really needs to get out.
Teach your kids boundaries young!
I dont have kids, I can see kids being at home during working hours may through a wrench into my rant. Especially at a young age when they dont understand what I'm doing.
I can't work productively from home:
1. Young children don't understand daddy having to separate work time from home time
2. Wife that doesn't get that just because I'm in the house, it doesn't mean I can babysit or help with household chores
3. Crazy dog barking every time a car passes outside the front door
4. Lack of a dedicated space (in an already small Bay Area living space) for doing work
5. Commuting is my way to mentally get myself in and out of work mode, driving around the block doesn't cut it
6. Lack of regular, daily human interaction (even if it's just co-workers) is depressing after a day or so
7. My typical work role has me having to hunt people down who don't respond to E-mail/text/etc.. can't effectively do that from home
1. I don't have kids, it sounds like I should enjoy WFH while I'm young!
2. Wife also is a full time WFH, ironically we exchange very little dialog other then around lunch time during the day. I'm lucky that she "Gets it" in my case.
3. no pets,
4. we have no dedicated office, in fact my desk is in the living room, and hers is in the bedroom. We relish our frugality though and every time we are about to complain, we look at how much a 2 or 3 bedroom apt costs!
5. I'm impressed this does the trick for you. Driving / commuting just gets me all riled up, I cant stand how they let other people on the road!
6. This was SOO hard during my first year. I was definitely thrown into a slump shortly after I made the switch. I now have a regularly occurring social event 4 days a week that gets me around other people which helps me stay social.
7. Since all my co-workers are also work from home, Email, Phone or gchat usually extracts a reply immediately, even if its "On phone, will get back to you in 1 hour"
You have to train your housemates to respect your space, and having a dedicated home office really helps. One of our bedrooms is a combined guest room/office and a closed door means "don't bother daddy".
IMO the best usecase for WFH is to live in a lower-cost area. If I was in SF or SJ metro instead of the Bay Area suburbs I'd probably go to the office just to hang out with people, cause that's kind of the point of living in SV.
The thing that struck me about the first picture was how uncomfortable the chairs looked. Why would they spend so much on decorative lighting and neglect the parts that are essential for prolonged productivity?
I'm assuming it's because whoever's sitting there only does so for relatively short amounts of time - an hour, tops.
Then again, maybe the younger generation evolved to be able to sit uncomfortably for a long work day, ;p
I can't be the only one who's tired of the USA's alcohol-drenched startup culture.
In the first four paragraphs:
keg, keg, beer, bar, tap, bar, pub, microbrews, tap, happy hour, tequila, margaritas, "90,000 glasses of beer".
Frankly, as an America who also likes to drink, I find it tiring, too. Because it's not about the drinking. It's about about dedicating your whole life to the corporate ideal. Screw that. That's not why I got out of working for The Man. Why are we starting all these startups that don't respect our work life balance? How are we going to expect any employer to respect us if we don't respect ourselves?
And WeWork in particular is flipping expensive. Most of what they offer can be had by buying $5 lattes every hour at your local coffee shop. I'm a member at a more bare-bones competitor to WeWork[0] that, if you price it out, is cheaper than going to coffee shops. And it's also quiet, there's a printer, and the wifi works all the time. And you're still getting coffee out of the deal.
For WeWork's prices, I want to start having some private locker space or something, so I can maybe leave a laptop, lock up my papers, etc., not have to hump it around on the metro all day. If you want that level at WeWork, you have to pay such an exorbitant fee that you might as well just get three of your closest friends together to rent your own office.
At least then I wouldn't have to deal with a bunch of overgrown children having nerf battles.
[0] http://www.cove.is, though I'm pretty sure they're only available in the DC Metro area.
EDIT: I just checked, and they've recently dropped their prices. WeWork's entry level used to be in the $100/mo range. Cove is still cheaper, and the private storage levels are still very expensive.
I like beer, but it's exhausting because the assumption is your socializing now takes place at work. I imagine it's pure hell for anyone who struggles with alcohol addiction.
As a compulsive eater, I HATE it when offices have free snacks. It's mentally taxing to know there's free snacks only meters away all day long. When I switched from a place with free chips and candy to a place with free apples and pears, I lost a decent amount of weight.
But at the same time, you can't expect places to not have free snacks out just because you can't deal with them. And for the record, I actually hate having snacks around too but that's something that I feel like I need to deal with myself.
It must be really difficult to be an alcoholic in a workplace environment where people drink regularly. But being an alcoholic in general must be really difficult because of the emphasis that our society puts on social drinking.
Very true - I just find it to be a great challenge. I certainly wouldn't tell my coworkers they shouldn't have access to snacks because of my own issues, the same way I enjoyed the free beer (good beer too!) at my previous job. The difference is I don't have any trouble putting beer out of my mind until Friday afternoon, whereas food is ever in my thoughts when it is presented.
This is hardly specific to the USA work culture. From what I understand European offices make the US look like a bunch of teetotalers. And the drunken Japanese businessman singing karaoke isn't a cliche for no reason.
In the City (London) - Coffee and Alcohol really do make the whole thing go round. Get hepped up on Caffeine all day, retox on the booze post work. I can also remember the liquid lunches of the seventies and eighties (basically beer or wine for lunch, maybe some food). Oh and nicotine. Huge numbers of smokers!
BMW has beer vending machines with no time restrictions.
https://suegoestogermany.wordpress.com/2012/06/21/thursday-6...
That's interesting, because I have the opposite reaction: I'm really tired of USA's general puritanical anti-alcohol culture. It's tiresome and moralistic.
I'd love to have a glass of beer with lunch and not have an arbitrary taboo about alcohol at work. I'd love not to worry about drinking in public. It's treated like an ugly bodily function! I'd love not to be hassled for ID everywhere I can drink. I'd love (or, more accurately, would have loved) a more reasonable drinking age.
But no, US culture makes casually drinking alcohol—something that should be entirely reasonable—awkward and difficult. In practice, all it means is that I can't responsibly enjoy a nice glass of wine at the park and college students still end up binging on cheap beer and liquor.
That's not anti-alcohol culture, that's simply authoritarian legislation. Alcohol licensing authorities, operating on 200+ year old laws enacted by uptight religionists, have taken it upon themselves to cause as many possible hurdles to business owners as possible, simply because they can.
It's not an "anti-alcohol culture". It's simply power-hungry officials. The US drinks like there's no tomorrow.
Definitely not alone. I don't drink so when the company gets together for beer I just feel really awkward or don't go.
Purely out of curiosity, do your coworkers know that you don't drink or are you trying to keep it a secret (which is totally understandable)?
Not him but I also choose not to drink, so I'm in the same boat.
I'm vocal with my coworkers that I don't drink and that's why I do not attend many of the social outings. We have a lot of outings that don't center around or involve alcohol (ie. Gokarting) and I attend those. I make it a point that I'd rather they go have fun at a bar and I'll "sit this one out" rather than turning all events into "sober-friendly" events.
E:
Since it might be brought up... I politely decline offers to attend the bar gatherings and "just don't drink". I dislike being around drunk people - I find them annoying and having to repeat myself 20 times in conversation to be frustrating. Instead of ruining their fun experience with my irritated and increasingly unfriendly attitude - I stay at home and let them enjoy their time.
They know. I'm not the only one who doesn't drink. I think one other person doesn't in our company of 10 people.
I'm pleased. It seems like a better culture than the alternatives.
My eyes rolled so fast at that I got dizzy.
I worked for a startup that grew past startup phase and no one drank.
Don't worry, you aren't the only one. I long to be transported to a time or place where humans weren't so accepting... no, seeking such blatant disrespect to their personal dignity and craft.
It seems to be one facet of a theme of infantilization and youth glorification in work culture and society at large. I am not sure whether it has any relationship with the rise of the "social" plague in industry, and the widespread infiltration of VC onto college campuses (and now elementary school playgrounds), where the youth are increasingly primed for dependency through the advertising and systematic denial of experiences.
Offices for adults these days are becoming more like playgrounds, and playgrounds for kids are becoming more like jails. I can't understand all the psychodynamics at play, but something is clearly broken with the way we treat our youth and our narrowly defined notions of "fun".
Work culture is not about the worker or the work anymore, it is about creating an interdependent unit of labor. But if neither the quality of work nor the quality of life for the worker is emphasized, I am not sure what the purpose is besides to maintain social order.
> playgrounds for kids are becoming more like jails
The solution to this problem is to revolt. Stop taking your kids to the playground. Get them helmets and a kickbike and go to the local skateboard park. Go out hiking with them, even if it's just 300 yards in a park. Run on the beach. Let them eat the sand. Give them proper rain clothing and boots so they can jump in puddles for hours on end. Teach them that there is no bad weather, just bad clothing. Show them how a socket wrench works. Let them "help" whenever you're doing something, if it's cooking or cleaning or repairing stuff or whatever. And for gods sake don't buy them a tablet.
DISCLAIMER: said activities may require physical exercise and actual parenting.
Without a tablet, how are they going to read the schematics to meaningfully help with projects?
It's never too early to teach your kids about the numerous advantages of schematics printed on dead trees.
i cannot give this enough up-votes.
I work in this youth glorified startup world. It's awfully critical to imply that those of us who enjoy the atmosphere are "seeking blatant disregard to their personal dignity and craft."
There's not as much drinking done as you would think and really it's either an after work hours thing or someone is coming in checking the place out and has a beer. It's really not a big deal. It's actually just more convenient because alcohol can loosen you up and means you don't have to go across the street to an expensive bar.
I believe you're taking an overly hard-lined approach to this. I work very hard, and so do many others. There's some who just dick around, but that's going to be in any office. I would ask you though, what's more conducive to meeting new people around the office? A light-hearted 5:00 / 6:00 drink at the bar right outside the work area where there's already other people drinking OR organizing everyone to go to a bar across the street and hope people show up OR just going to the bar?
WeWork is a great place because of the community it builds and you might very well argue it does that on the back of its kegs with taps labeled WeWork. Is this really so bad? Think about your typical startup who's struggling to get along. Isn't it better that they have others to talk to especially others who are going through the exact thing they are?
I genuinely think you can't understand all the psychodynamics at play because you're stubbornly holding onto your perception of a workplace should be. Hey to each their own, but I see a lot of positives in WeWork's approach.
I'm not as vociferous as the person you're replying to, but I'm starting to think of the all-consuming social scene of modern startups as one of the reasons why diversity is still a major problem in the tech industry. I don't think socializing with coworkers all the time--either in the office or outside of it--is healthy. It reinforces monoculture. I think it's healthier to have everyone socializing outside of the circle of people they see every day already. If the only friends you have are the people at work, then to whom do you turn for personal recommendations when you need to add people to the company?
If employees want to hang out with each other, that's fine. I just don't think it's a good idea, in the long run, for companies to be pushing like this.
Slightly off-topic - but how is diversity (or lack of thereof) a major problem in the tech industry? Is there any proof that it's a problem? Are there companies that have truly diverse workforce that are more successful than ones without?
I'm trying to consider how your comment is not an indication that you have actively hidden from the last several years of press and are stubbornly trying to deny there is a problem. This has been known for a long time and it is endemic across companies. http://www.techrepublic.com/article/diversity-stats-10-tech-...
Again - why is that a problem? There is certainly a statement of fact (there are relatively few blacks or hispanics in SV). How is this a problem? Is the goal of these businesses to make good products or provide employment to all society strata?
Should I be equally bothered by lack of whites in the NBA or the NFL?
You're absolutely right, it's not the goal of business to enact social reform. That's why it's the pervue of government to enact legislation to require it. Just as it's not the goal of business to avoid polluting our air or our water "as long as it doesn't affect the bottom line!" Just as it's not the goal of business to have its employees wash their hands after using the restroom before returning to cooking food. Negative externalities require regulation to correct when the market demonstrates a willingness to ignore the problem.
RE: the NBA and the NFL: Should the bad behavior of anyone be an excuse for others to behave poorly? Also, why has the MLB gotten more white, less diverse in recent years?
Right, but you are still avoiding the issue of proving (or explaining) how diversity is something that should be sought after. You think it matters and I do not.
I can see how we ought to have government mandated equal access. Ie someone should not have worse chance of being hired in SV because they are black or Mexican. But if the numbers of qualified candidates vary by a factor of 100 (how many black vs white or asian CS PhDs are coming out of the pipeline) - why is the lack of diversity a problem of the industry?
> But if the numbers of qualified candidates vary by a factor of 100 (how many black vs white or asian CS PhDs are coming out of the pipeline) - why is the lack of diversity a problem of the industry?
Where one of the driving factors beyond product development in the industry is "scratch your own itch and scale it out", lack of diversity of background (of which sex and race/ethnicity are components, but not the only important components) means lost potential markets, so its in the interests of those who want to invest in the new markets for the industry (e.g., most of the big players in the industry, and most of the investors in big and small players in the industry) to invest in broadening the funnel. It is, if not a problem of the industry, a problem for the industry.
(It also could be a symptom of a problem of the industry in which the industry itself takes action, without realizing the effect, which narrows its funnel, reduces the supply of talent attracted to the industry, and drives up costs.)
Ok - sure. That is a reasonable explanation (at least that I can not fault with being self-serving for a particular group).
But is there any proof for it that makes it more than a hypothesis? Is there any example of a company staffed by minorities that is more successful at serving those minorities?
Because all we really have are counterfactuals - I can't think of a single SV company that did well because it made a point of hiring from the underrepresented groups.
I have no perception of what a workplace should be. That is up to the individuals who actually do work together or alone. Apparently its some other people who have ideas of what a workplace should be because every workplace these days is the same generic adult playground (with free drinks and snacks and open collaboration!).
I would prefer if everyone just worked from home, or in a shared community workshop, or private studio, or coffee shop, or bar, or wherever they fucking want. WeWork is nothing more but a modern spin on Office Space culture. If people like that, I am happy it is another option available to those who enjoy working in that kind of space. Just make sure you don't think you have stumbled upon the holy grail of work spaces, and push it on everyone who is looking for work.
I'm not sure that alcohol and infantilization go together... or maybe I should revise my parenting methods.
Sounds like an awful lot like corporate speak.
I think there is space for everything and they will be one of the kinds of office solutions, but not the solution.
Neither everyone nor every job is optimized for close proximity with others. Nor does everyone want to extend the dormitory study room culture indefinitely into adulthood. I think this kind of space works for some job types and industries, but definitely I do not see it as the one future for all office spaces.
But congratulations on trying to make this popular and succeeding so far. The more choice the better.
At first, WeWork really did sound like little more than a large, consolidated chain of coworking spaces. The way the article is laid out, you first read that description and then read the founder's breathless claims of how they're not just another real estate firm. But with a crazy valuation!
So you take all that with a grain of salt. Founders are always talking about how they're doing something completely novel and groundbreaking, even if they're not.
And then you hit some little details: "…valuable benefits like access to a group health insurance plan…". In the US that is a big thing. If they're offering group health insurance, they really aren't just another real estate company!
In fact, I'm pretty enthusiastic about the idea now. I've always thought that many of the benefits offered by large corporations did not have to be tied to a single monolithic entity. Nothing about well-managed office space, group health insurance and shared infrastructure is inexorably tied to having a top down autocratic organization, but historically it has been.
Wouldn't it be cool if somebody supplied the same infrastructure not to business teams in a rigid hierarchy but to a loosely federated network of startups and freelancers?
Looks like exactly what WeWork is offering.
I work in WeWork and love it. It's a great atmosphere and can be inspiring to look around and feel the young, vibrant energy. That's a bad title though; it certainly isn't a waste of space and the article never even seemed to allude to it being a waste of space.
I want my 8x8 cube back...
The current 5x5 feet of open office space I have has led me to mostly work from home.
However, I do think the small studio + co-located coworking space is a winning concept. Bundle in things like laundry service and perhaps catering (everyone needs food, not everyone needs alcohol) or even just Soylent/Jakeshake, and it's starting to be a pretty useful value-add, editing out all of the generic day to day tasks that suck up one's only nonrenewable resource.
I think this was a fine article with a terrible title.
I worked out of WeWork’s SoHo office in NYC for a while and was pleased with the details they got right to make themselves attractive to startups (no pesky sales team, short notice to cancel, no nickel and diming on Wi-Fi, printers, etc.).
Before WeWork, I also worked in a Regus office (their competitor mentioned in the article) and they managed to get all the same things wrong. Perhaps they have adapted since. I’m unaffiliated with either company but wish WeWork well. It was a fun vibe they cultivated and everyone seemed to enjoy working there.
Despite being (at the time of writing) 2 hours old with 26 points, this story has crashed from the front page to position 103? An intriguingly fast fall..
I was curious about that myself (for the obvious reason :) I presume some of the deeply nested comments tripped a flamewar detector, and the ranking cratered thereafter. (I remember reading somewhere about the nesting level being used as a post quality indicator.)
Well thanks for posting it anyway, I found it an enjoyable read :)
WeWank™ CoWanking™ spaces inbetween the mostly empty airbnb housing projects that you shuffle between with uber, all coming to a city near you.
Did anyone else find the article illegible? I struggled to read the white-on-black text for several minutes. After closing the article I struggled to be able to read HN.
| Neumann says, while jettisoning the socialist part. “On the one hand, community. On the other hand, you eat what you kill.”
Neumann doesn't understand what socialism is.