When the largest U.S. co-working company, WeWork, expanded into China in 2016, it did so without a local co-working partner. Now, almost two years later, China’s largest co-working company, Ucommune, is expanding into the U.S. But unlike WeWork, it decided it needed some help.
“This kind of business is very local,” Ucommune’s chairman Mao Daqing. “You must know the local market well. You must know the customs well.”
On Wednesday, Ucommune celebrated the launch of its first U.S. location. Its local partner Serendipity Labs will manage the space at Fosun International’s 28 Liberty Street, which will feature both companies’ names on the door. Ucommune members in China will be able to book a space at the Manhattan location through their app.
For Serendipity Labs, the partnership offers a chance to win over customers looking to interact with Chinese businesses. “We set out to connect our networks,” the company’s founder John Arenas, a veteran of office suites giant Regus, said.
28 Liberty Street
For UCommune, it opens a door into one of the world’s largest office markets. “We need to go to those gateway cities which Chinese people go to very often,” Mao said. “We have to do it. This is part of our service.”
Ucommune launched under the name UrWork in 2015 and has grown to almost 150 locations across China. Along the way, it raised more than $400 million in venture funding from the likes of Sequoia Capital and Beijing Capital, most recently at a $1.7 billion valuation. The company is currently looking to raise $200 million in a Series D funding round.
Rocktree Capital’s Omer Ozden, a veteran of Xinyuan Real Estate who spearheaded the developer’s expansion into the U.S., introduced Mao to Arenas about two years ago. For now, the two firms aren’t working on any other joint locations.
Ucommune’s ambitions in the U.S. are somewhat limited. “We’re not looking to get into second-tier cities in the United States,” Ozden said, pointing to San Francisco, Los Angeles and Toronto as other possible locations. “It’s not going to be a major footprint in the country.”
Ucommune recently changed its name from UrWork following copyright infringement lawsuits from WeWork, but Mao dismissed the episode as insignificant, merely blown up by the press. “That was a small matter,” he said, “and it’s become a very big nonsense, I think.”