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World's Largest Shared-Workspace Startup WeWork Is Cutting About 7% of Staff (bloomberg.com)

Posted by msmash on from the life-at-booming-startup dept.

Ellen Huet, reporting for Bloomberg: WeWork Cos., the $16B startup, plans to cut about 7 percent of its staff and has instituted a temporary pause on hiring, according to e-mails obtained by Bloomberg. The cutbacks come just three months after the New York company said it raised a round of $430 million led by Chinese investors. Managers were instructed to begin dismissals this week, said one of the e-mails. The startup, which lets members rent desks in an open office, ballooned from about 230 employees early last year to more than 1,000 today, according to research firm Mattermark. WeWork said it hired 175 people in May and expects to add about 500 employees by the end of the year. The company said it expects to lift the pause on hiring as soon as next week.

10 of 51 comments (clear)

  1. A little confused by the summary by elrous0 · · Score: 3, Insightful

    which lets members rent desks in an open office

    Couldn't you just go to the library and get a desk and computer for free?

    --
    SJW: Someone who has run out of real oppression, and has to fake it.
    1. Re:A little confused by the summary by rock217 · · Score: 3, Informative

      They also offer gigabit, conference rooms, free coffee and beer, etc.

      --
      Wah Sig!
    2. Re:A little confused by the summary by elrous0 · · Score: 3, Funny

      At $50 a day, I would have to drink a lot of beer for it to be considered "free." But hey, I'm up for a challenge.

      --
      SJW: Someone who has run out of real oppression, and has to fake it.
    3. Re:A little confused by the summary by Mitreya · · Score: 4, Insightful

      Couldn't you just go to the library and get a desk and computer for free?

      Yes, you could, but that's not going to generate a $16B valuation out of thin air.
      A more interesting question is why do they need over 1000 employees.

    4. Re:A little confused by the summary by serviscope_minor · · Score: 3, Interesting

      Oh don't be silly.

      It's a co-working space. Going and getting a desk in a library is not suitable for about 99% of actual small businesses. Co working spaces provide you with the things you ACTUALLY need in an office, like a permanent desk, conference rooms, places to make phone calls without disturbing everyone, kitchenette facilities etc.

      You know, office things not a library.

      And running offices actually takes real people.

      --
      SJW n. One who posts facts.
    5. Re:A little confused by the summary by elrous0 · · Score: 4, Insightful

      At about $1,000 per person/per month that had better be one bitching kitchenette.

      --
      SJW: Someone who has run out of real oppression, and has to fake it.
    6. Re:A little confused by the summary by serviscope_minor · · Score: 5, Insightful

      Couldn't you just go to the library and get a desk and computer for free?

      No not really. Most businesses want a proper office to work out of, for a variety of good reasons. Small businesses are no different, but if you only have a few people, it's much cheaper to pool resources and rent only a desk or two while the less used but essential facilities (conference rooms, phone rooms, kitchen, showers, toilets, etc) are pooled.

      --
      SJW n. One who posts facts.
    7. Re:A little confused by the summary by retchdog · · Score: 4, Insightful

      i guess you could, but you'd have a lease term of a year and will generally have to pay at least first+last+security upfront (with bad credit it will be either more, or just not available at any price). in the better areas of Brooklyn and Queens, that's going to be about $10,000 upfront; in the ass-end of nowhere, it's still at least $6,000. then again, you don't need a three-bedroom. even better, if you're savvy you can still independently rent bare-bones workspace for much, much less.

      the rational use of daily-term wework rentals is if you're in a city and professionally meeting with someone for a day, and want an office space to get your shit together and look at least semi-professional, rather than meeting a client in the hotel lounge or a starbucks. wework offers longer-term contracts for businesses. comparing the daily rate to a leased apartment is like saying you should buy a house instead of renting an apartment. it's solving a different problem.

      --
      "They were pure niggers." – Noam Chomsky
  2. Re:Startup? 16 billion dollars?! by elrous0 · · Score: 3, Interesting

    I saw an interview with Mike Judge recently where he said that he had originally intended Silicon Valley to be a parody of the real thing, but quickly discovered that the real thing is much more bizarre and insane than he had imagined even in his comic fictional universe. The biggest criticism he said he got from real "angels" and VC's was that it wasn't realistic that these characters even had to work at all to get funding. In real life, Silicon Valley investors would be pushing each other out of the way to throw money at them, just on the PROMISE of an idea.

    --
    SJW: Someone who has run out of real oppression, and has to fake it.
  3. It's more than that. by luis_a_espinal · · Score: 3, Interesting

    which lets members rent desks in an open office

    Couldn't you just go to the library and get a desk and computer for free?

    It's more than that. You get dedicated network services, and in some cases, a business number with a receptionist/secretary, PO boxes, etc. You can have a business presence on-demand, or a-la carte. This is more important when you have to meet with customers. You can book conference rooms, pay-as-you-go, to meet your customers while doing most of your work from home, let's say.

    It is a balance. For some people it might be better just to lease an office. For others, shared workspace might be the way to go. It's all a matter of your specific accounting and cash flows needs.