Commentary

WeWork Working At Expanding Its Digital And Physical Footprint

After announcing last week that it is beginning to work with big businesses to create and manage their office space with a personalized service called Onsite Solutions, the workspace-sharing company WeWork yesterday opened the portal to its Services Store that offers access to the likes of Slack, Salesforce, Upwork, Zipcar and Citi Bike. 

“Here’s how it works: For WeWork’s streamlined partners, users can simply purchase software from the WeWork site like any other e-commerce transaction, and the software automatically gets information about the number of seats, name and billing. For the CEO, that transaction is reflected as part of the WeWork invoice for that month,” writes Jordan Crook for TechCrunch.”

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“A member logs in to the WeWork Web site and clicks into the Services Store. Enterprise services like Slack, Hive, InVision, Box and more are organized by use-case and feature their own reviews from existing WeWork members,” Crook continues.

“In order to differentiate from ordinary app stores, WeWork offers much of the software in the Services Store at heavily discounted prices,” Natalie Gagliordi reports for ZDNet. Salesforce, for example, will be available at 30% off “in an effort to expose more small businesses to its CRM software portfolio.” 

On Quartz, Sarah Kessler writes about an interview she had last year with COO Artie Minson, who had been CFO of Time Warner Cable before joining the New York City-based startup in 2015. As different as the organizations might seem to be, Minson said that “his vision for WeWork involved a business model that does look like a cable company. He called it ‘programming for real estate.’”

Kessler calls the Services Store “the first iteration of a platform that enables the idea.” 

“The digital services store is a step,” says WeWork cofounder Miguel McKelvey, she writes. “But it’s also an indicator of where we’ve headed in terms of growing our business and extending it. It’s important symbolically.”

Reuters reports that “about 22% of its customers are now companies with more than 500 people, a client base WeWork is targeting for growth potential. It operates in 135 locations spread across 44 cities in 14 countries.”

At a breakfast event in Manhattan last Wednesday, WeWork's chief product officer David Fano and head of product research Joshua Emig “announced the company's expansion into services designed specifically for enterprise companies. The move comes shortly after WeWork received a $300 million investment from SoftBank, valuing the company at more than $17 billion,” Anna Hensel reports for Inc.

“Fano pitches the concept as ‘space-as-a-service,’ though that’s not an official term. What it means is that WeWork will charge a recurring fee for its property and culture management services,” reports Ruth Reader for Fast Company. “The emphasis here is on helping other businesses attain WeWork’s worker-focused mentality by providing an attractive workspace that is both efficient and provides certain perks — like coffee and snacks.”

“WeWork has no intention of becoming an office design firm. In fact, a three-to-five year office management contract precedes the redesign service,” Leo Lutero reports for PSFK. “This is what makes the ‘space-as-a-service’ program unique. For WeWork, it is important to be able to manage the spaces they construct as the design principles are connected to the office culture.”

“WeWork’s business until now has focused on leasing big blocks of space in urban settings and converting it into trendy co-working centers available to entrepreneurs, tech firms, startups and other companies. Customers can rent a desk, an office or entire floors on a month-to-month basis,” Peter Grant explains for the Wall Street Journal.

“The new centers will be leased by the companies but managed by WeWork for fees. There likely will be a modest ‘powered by WeWork’ logo somewhere on the site, but the branding will mostly be of the companies leasing the space. WeWork will make most of its money on the monthly service contracts.”

“We’re trying to be entirely different: It’s the hospitality, it’s the amenities, it’s the data and the analysis and truly understanding how you’re leveraging your real estate,” CPO Fano tells Grant.

At the WeWork event last week, Fano told reporters: “We've got certain beliefs, philosophies of what it takes to make a highly energized work environment, and often times that means reducing your footprint, getting people to work a little more closely.” 

And a little more cheaply, too, presumably.

 
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