business

SoftBank clinches deal to take over WeWork

12 Comments
By Anirban Sen, Jessica DiNapoli and Jane Lanhee Lee

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12 Comments
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Wework customers will become Softbank customers, eh? The horror! I guess the staff will demand to see customers' visas and passports every time they use the premises, and refuse to issue receipts for their purchased goods and services.

Because that's how I was treated while a much-abused customer of emobile, after Softbank bought it.

-1 ( +1 / -2 )

@JeffLee, I'm with you, I have no idea how a company like Softbank can be so successful, they must have a sideline hidden, because they can't be making money from theit telecoms business.

I don't understand WW either, prime realestate sitting idle waiting for interloper clients, who spend billions developing without long term leases lined up? Banks certainly wouldn't fund projects without lease commitments.

Love to see return on equity figures for WW.

2 ( +2 / -0 )

I am so happy I dumped those Softbank shares at the beginning of this year. After WeWork further drives down their share price, maybe I will look to buy shares again.

Son is an idiot. He keeps dumping money into a project that has an unsustainable business model. Its only real viable use is in times of economic downturn and even then, it becomes a costly service that wouldn't be really utilized. You can't have such lagged profits with consistently high and long term costs.

Jamie Dimon pulled out because they wouldn't accept the lowballed offer.

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@JJJPlane

Jamie Dimon is in it for the fees, he has probably packaged the investment up and sold it off as some kind of derivative already.

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WOW..how many mistakes will SOFTBANK make

wework

make my trip

klook

Soon it would itself be bankrupt.

If you have money that doesn't mean you will keep investing without any due diligence, and invest in tips of the iceberg, invest in the ICEBERG instead.

WAKE UP

-1 ( +0 / -1 )

Neumann made a smart move or two with the SoftBank investment capital. He obtained MeetUp founded in 2002 is a social network co for organizing social events. It has an enormous membership base and Neumann purchased the old Lord and Taylor building on 5th Ave in Manhattan as an expansion space. The Hive office sharing co. I believe has gone global, Wework really is a good idea but it needs to spur innovation by bringing in speakers at the forefront of innovation, offer workshops and open incubators where People can contribute to a innovative project as an investment if their idea is used. It does not always have to be about money.

0 ( +1 / -1 )

It does not always have to be about money.

Then why raise capital? Why not let participants pay their own way, on the go?

Tgere are two fundamental business principles tgat WW is trying to break here: RoE and pricing of risk. Their model doesn't even attempt to say how they intend to replace these principle, other than 'but we're innovative and disruptive'.

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Son is just throwing good money after bad. Everyone talks about Neumann as some amazing visionary because he built a business that appeals to a certain niche like but also loses money hand over fist and was about to go bankrupt if it wasn't for this last infusion? Hell, give me a few billion dollars and I'm sure I could create a company that loses money.

4 ( +4 / -0 )

Sharing an office space is not free. Its cheaper than renting a single tenant space and it has a social network. I believe Wework has over 150,000 tenants sharing office space.

-3 ( +0 / -3 )

Sharing an office space is not free. Its cheaper than renting a single tenant space and it has a social network. I believe Wework has over 150,000 tenants sharing office space.

WW has approx. 5 million m2 of space. Assuming it's 100% utilised (highly unlikely), assuming he gets $500/m2 (also unlikely), is that going to generate enough returns (less costs of doing business) on valuation of the company at close to $50 billion?

At the moment, the cost of doing business is outstripping revenue significantly. That's best case scenario.

Now look at it as it is. The company has liability lease obligations at $47 billions, but lease commitments of only $4 billions. Again basic algebra.

Then there's risks, the company looks like doesn't stack up either side of 10% sensitivities...

GLTH, but I feel for investors (except mr Son).

0 ( +0 / -0 )

Sharing an office space is not free.

Public libraries are indeed free. Plenty of free lancers have long been using them, instead of paying 80,000 yen a month to borrow a chair at a big table in a WeWork space.

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Public libraries are indeed free.

Can you receive calls, mail, and have meetings a library? How about networking? Do they provide high speed internet? Is it business friendly?

Sure, you can work at a public library. But to think it's the equivalent to a shared office is pretty silly. They serve different purposes.

You can shovel a hole with a spoon too. That doesn't mean the spoon is the right tool for shoveling.

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