WeWork began in the year 2010, with just one building but with an excellent vision for a brand and conviction that there are creators in need of space. The founders of WeWork are Adam Neumann and Miguel McKelvey, who envisioned the need to create office spaces that freelancers, smaller companies, startups, and traveling employees would call home. WeWork is a real estate company that is valued as a tech company (CBInsights, 2019).
The company’s marketing strategy focuses on a strong ethos of entrepreneurialism and creating open office spaces that are more of a community. WeWork offices are decorated with slogans that enhance creativity and motivate people to do what they love. The office spaces in WeWork’s buildings average about 50 square feet per person while the average area in other commercial offices is approximately 250 square feet. Despite the seemingly smaller spaces and crowded offices, each member generates average annual revenue of $6,641 (CBInsights, 2019).
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How WeWork Operates
The WeWork Company generates funds through rent arbitrage. WeWork leases buildings from landlords and converts them into well-designed office spaces, which they then charge their clients double of what they pay the owners. The objective is accomplished by packaging more people in their locations. WeWork positioned itself as a home to new economy business activity. It provides small businesses and entrepreneurs seeking a place to work from facilities and office spaces. People can book a shared office space from as little as $190/month or on-demand membership where you pay-as-you-go starting at 45/month (WeWork, 2019). There are other benefits associated with renting space at WeWork such as fast Internet services, private phone booths, front desk services, unique common areas, access to a global network, business printers, and micro-roasted coffee among others.
The convenient prices offered to the WeWork communities has led to its increased membership and growth both locally and internationally. The WeWork Company began expanding globally in the year 2014 by opening offices in London, Tel Aviv, and by 2016 they had offices in Shanghai (Neumann, 2019). The company had 200,000 members in February 2018, which was a 54% membership growth in nine months. Also, CBInsights (2019) notes that WeWork adds between 500,000 and 1,000,000 square feet of new office space every month due to growing demand and the company now has more than 500 locations worldwide. WeWork Company partnered with other companies such as Factual, FieldLens, and Case Inc. to help scout for new sites and convert the rented areas into conducive offices that suit WeWork’s business model.
WeWork mission is “Create a world where people work to make a life, not just a living.” The founders of WeWork understood the changing nature of workplaces and how people do business. WeWork recognized the existing gap where most business settings valued work more than personal growth. The founders aimed to change this set up because many young workers, who are now the highest workforce, appreciate a more work-life balanced environment. The success of WeWork is based on its ability to build communities in their locations. According to Spreitzer et al. (2015), people who work in shared space have more job control, and they view their work as meaningful. Therefore, WeWork allowed people to work, interact, and grow their businesses. The mission statement has only one component:
- Create a conducive working environment
This component illustrates the focus that WeWork has towards facilitating individual growth and favorable working conditions. WeWork business model is based on providing entrepreneurs with office spaces at lower costs which they would spend when renting a space. WeWork Company, Inc. understood that many modern creative workers want to use their skills and abilities to build the careers that they love. Also, the company was also trying to eliminate the rigid traditional business practice where people work from 9-5. Therefore, WeWork meets the needs of their clients by transforming buildings into smaller offices and common areas with individual desks and all office equipment. The WeWork members include the remote workers and freelancers who need unlimited Wi-Fi to focus on their job or an office to stay away from home. The company also facilitates small businesses with spaces to meet with their clients and build great business empires without incurring high operating costs. Also, most of the shard spaces are accessible at any time and workers can join or leave at any time. The freedom, shared spaces, social interaction, and lower costs of starting a business have made WeWork one of the most valuable startup in the world.
WeWork vision as published in its website reads as “We wanted to build a community. A place you join as an individual, ‘me,’ but where you become part of a greater ‘we.’ A place where we’re redefining success measured by personal fulfillment, not just the bottom line. Community is our catalyst.” This vision emphasizes the importance of community. WeWork builds office spaces that enable the members to choose when and how to interact because it brings people from different backgrounds together. Spending time in a co-working environment can help spark new and creative ideas. WeWork Corporation also emphasizes on the importance of personal fulfillment, not just working to earn a living.
The components in WeWork’s vision statement:
- Building a community
- Fostering personal growth and fulfillment
WeWork’s “building a community” component stipulates an environment where people share knowledge and networks to solve problems. Many freelancers and remote workers occasionally need to leave homes to work in offices. WeWork offers such people an opportunity to work in shared spaces with people sharing a common goal. WeWork provides numerous benefits to their members such as high Internet speeds, office equipment, digital tools, conference halls, and an environment where people can interact and grow their businesses.
The “fostering personal growth and fulfillment” component indicates the commitment that WeWork has in growing talent and improving the standards of living. WeWork offers freelancers and small businesses an opportunity to work on what they are passionate about by providing cheap office spaces. The members of WeWork can also consult the employees at WeWork locations for free or interact with other members, which helps in expanding their knowledge. People working on what they love, interacting with others at will, and deciding when to work on their terms helps in boosting personal growth.
WeWork business model not only provides workspace for startups, but it also helps in fostering work-life balance. The WeWork business values have made it a successful business with just a few years of operations. The values of the WeWork as they appear on their website are:
- Inspired: We do what we love and are connected to something greater than ourselves.
- Entrepreneurial: We are creators, leaders, and self-starters. We try new things, we challenge convention, and we’re not afraid to fail.
- Authentic: We are genuine in our brand, mission, and values. We’re not perfect, and we don’t pretend to be. We are always honest and as transparent as we can be.
- Tenacious: We never settle. We get shit done, and we get it done well. Be persistent and knock down walls–literally if you have to. You have our permission.
- Grateful: We are thankful for each other, our members, and to be part of this movement. We don’t take success for granted. We’re happy to be alive.
- Together: We are in this together. This is a team effort. We always look out for one another. We have empathy, we know we’re all human, and know we can’t do any of this alone.
CBInsights (2019). WeWork’s $47 billion dream: The lavishly funded startup that could disrupt commercial real estate. Retrieved from: https://www.cbinsights.com/research/report/wework-strategy-teardown/
Neumann, A. (2019). The beginning of a new story. Retrieved from: https://www.wework.com/newsroom/posts/wecompany
Spreitzer, G., Bacevice, P., & Garett, L. (2015). Why people thrive in coworking spaces. Retrieved from https://hbr.org/2015/05/why-people-thrive-in-coworking-spaces
WeWork (2019). Workspace. Retrieved from https://www.wework.com/workspace?ref=loc_pricing