It’s a matter of time before his investors get nervous
SoftBank will invest another $1 billion in WeWork in the form of a convertible note. WeWork has already raised a whopping $5 billion from SoftBank alone.
Worth repeating: WeWork competitor IWG (Regus) was the office darling of the dot-com era. When the downturn came, tenants dried up and the company had no way to pay for its ‘debt-like’ leases. It filed for Chapter 11 bankruptcy protection in the U.S. and retained its U.K. stock-market listing.
WeWork vs. Regus: IWG recovered and currently has a market cap of $2.26 billion. Although WeWork generated 70 percent less revenue than its competitor in 2017, it was valued at $20 billion in its last funding round.
Getting out of hand… The company is looking to raise more money at a $35 billion valuation.
Vote of Confidence: Softbank’s Masayoshi Son: “WeWork is more than just a renter of office space, it is something completely new that uses technology to build and network communities… WeWork is the next Alibaba!”