WeWork on track for profitability by end of 2021, says chairman

Marcelo Claure says pandemic has sent demand for private spaces “through the roof”

TRD NATIONAL /
Jul.July 13, 2020 12:30 PM
Marcelo Claure (Getty, iStock)

Marcelo Claure (Getty, iStock)

WeWork’s business model may have been called into question by the coronavirus pandemic, but its executive chairman says the company is now near profitability.

The flexible-office startup, founded in 2010, is now on track for positive cash flows by the end of 2021, Marcelo Claure told the Financial Times. In fact, Claure said the pandemic has sent the firm’s demand for private spaces “through the roof.”

Mastercard, TikTok-owner ByteDance, Microsoft and Citigroup have recently signed new lease agreements with WeWork.

“Maybe the buildings are not going to be as dense as they were before for the community side of the business,” Claure said. “But the demand for high-quality workspaces that are sanitized, that [make] people feel comfortable will be at an all-time high.”

Claure — who also oversees operations at WeWork’s biggest backer, SoftBank — first announced in February that the company’s goal was to achieve profitability within two years.

During the first three months of 2020, the company burned through $482 million in cash, marking a 60 percent drop from its previous quarter’s spend of $1.4 billion, according to the FT.

Last year, WeWork’s $47 billion valuation plummeted to $8 billion after a botched public offering attempt, raising broader questions about inflated valuations of tech companies. Now, the company’s valuation is estimated to be $2.9 billion.

Prior to the onset of the pandemic, the beleaguered co-working company took drastic measures to reduce spending including laying off 60 percent of its workforce, which now stands at 5,600 people, down from a high of 14,000 last year, according to the FT.

The company began renegotiating building leases last year, and has continued through the pandemic. [FT] — Orion Jones


Related Articles

arrow_forward_ios
5212 North Bay Road in Miami Beach and Marcelo Claure (Getty)

SoftBank’s Marcelo Claure pays $11M for North Bay Road teardown

SoftBank’s Marcelo Claure pays $11M for North Bay Road teardown
WeWork Lincoln Road with Sandeep Mathrani (Google Maps, WeWork)

WeWork’s Lincoln Road landlord seeks $20M in unpaid rent

WeWork’s Lincoln Road landlord seeks $20M in unpaid rent
WeWork Lenox Avenue, WeWork Lincoln Road and CEO Sandeep Mathrani (Lenox location by Katherine Kallergis, WeWork, iStock)

WeMove: WeWork leaves Lincoln Road, consolidates Miami Beach operations to Lenox Ave

WeMove: WeWork leaves Lincoln Road, consolidates Miami Beach operations to Lenox Ave
WeWork at 429 Lenox Avenue (Credit: HFF)

WeDone: South Beach landlord seeks to evict WeWork for unpaid rent

WeDone: South Beach landlord seeks to evict WeWork for unpaid rent
(Credit: iStock)

Here’s how South Florida’s office market is changing in the coronavirus era

Here’s how South Florida’s office market is changing in the coronavirus era
Sandeep Mathrani and the Four Seasons Residences at The Surf Club (Credit: Four Seasons)

WeWork CEO buys condo at Four Seasons in Surfside

WeWork CEO buys condo at Four Seasons in Surfside
Mauricio Zapata, Lyle Chariff, and Luis Guevara, with a rendering of NeueHouse Miami

Co-working operator NeueHouse expands to Miami

Co-working operator NeueHouse expands to Miami
Laura Hines-Pierce and Jeff Hines

Hines CEO talks coronavirus, Opportunity Zones and WeWork

Hines CEO talks coronavirus, Opportunity Zones and WeWork
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...