WeWork are quite expensive - enough that startups will get their own offices when they reach some stability. So I’m left wondering, WeWork charge a lot and in turn they pay a huge premium for their building leases. How are they NOT making money?
They're a bad investment because they're riddled with debt. They've taken out long-term leases on properties that they're liable for. In a downturn their customers will probably vanish leaving them with their liabilities. Plus, they don't really have a moat. So all in all, it seems like the founder is doing anything possible to cash out before the house of cards comes crashing down.
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WeWork are quite expensive - enough that startups will get their own offices when they reach some stability. So I’m left wondering, WeWork charge a lot and in turn they pay a huge premium for their building leases. How are they NOT making money?
They're a bad investment because they're riddled with debt. They've taken out long-term leases on properties that they're liable for. In a downturn their customers will probably vanish leaving them with their liabilities. Plus, they don't really have a moat. So all in all, it seems like the founder is doing anything possible to cash out before the house of cards comes crashing down.
Because they are expanding. They claim their mature locations are making money, which makes sense.