WeWork Valuation Soars To $16 Billion

just nine months after investors placed a $10 billion valuation on WeWork, the place of business-apartment firm has raised another spherical of funding at a $16 billion valuation, in keeping with documents filed on Tuesday in Delaware.

The valuation used to be verified by way of a supply with information of the deal. Hony Capital and its mother or father company, Legend Holdings, led the round. Neither have been fascinated by previous WeWork funding rounds. Hony will lend a hand with WeWork’s China launch, consistent with this source.

“no longer handiest does WeWork have one of the crucial largest addressable markets i have ever viewed, however the high quality of its execution and fit for the chinese language culture is unparalleled,” Hony Capital CEO John Zhao mentioned in a WeWork weblog submit about the funding. “Our funding in WeWork is each strategic and obvious.”

the new valuation makes WeWork the sixth most valuable private firm, eclipsing SpaceX and Pinterest. On paper, WeWork is almost as precious as the largest publicly traded place of job actual property company, Boston houses, which has a market cap of about $18 billion.

Boston residences owns forty seven million sq. toes of office space. WeWork does no longer most often purchase real property, but instead rents place of work house wholesale and then subleases that space to smaller tenants at a revenue.

WeWork has signed up 50,000 contributors (how it refers to customers) at seventy seven locations around the world, and is ambitiously expanding. consistent with investor pitch paperwork leaked final year, WeWork plans to open 376 place of business places by using the tip of 2018. WeWork also plans to launch and scale a residential providing. Residents moved into the first of its dorm-like rental buildings, dubbed WeLive, in January. in line with the leaked pitch documents, WeWork plans to launch WeLive in sixty eight extra constructions with the aid of the end of 2018.

Critics have pointed to WeWork’s easy arbitrage industry version when arguing that the company’s valuation does no longer in shape life like trade expectations. “Their multiples are more like a tech firm than what a real property firm would get,” Charles Clinton, the CEO of a real-property funding platform referred to as “EquityMultiple” advised me during the months I spent reporting a feature on WeWork for quick company’s upcoming April problem. “There’s a feeling that that doesn’t in reality make sense.”

WeWork, however, sees itself far more as an running industry than a real estate firm. COO Artie Minson, who joined WeWork from Time Warner Cable, calls the industry “programming for real property.” just as channels convey a tv to lifestyles, WeWork desires to be the business that makes space hum. Adam Neumann, the corporate’s 36-yr-previous founder, envisions “WeNeighborhoods” or a “WeStreet.”