If you take a look at the businesses that have been starting up in Utah lately, you’ll notice a clearly defined and very encouraging trend. We’re becoming a hotspot for tech and business startups.
In fact, a recent study named the area the fourth best place for tech jobs. As tech jobs continue to come to Utah, one thing’s for sure: companies that service and capitalize on tech growth will come as well — which will certainly bring economic growth and new opportunities to our region.
WeWork, the co-working office space company, seeks to capitalize on many startup scenes across the country. WeWork has successfully snatched up real estate locations and transformed them into swanky co-working spaces catered specifically to startups. The company is expanding, announcing the opening of three locations in the Salt Lake area.
WeWork is a pioneer in the co-working office space sector and has housed many startups and organizations. However, in spite of WeWork’s success, the company is not without its internal problems.
According to Business Insider, WeWork was recently offered a massive $16 billion investment deal from the Japanese-owned Softbank, which would have been another in a long line of investments from the firm. However, recent market volatility forced Softbank to slash the deal down to $2 billion at a lower valuation.
One big reason for this slash? According to Fast Company, WeWork’s margins have been slim to say the least. While they excel at raising money, WeWork also spends it — a lot. As stated by Fast Company, “For the first three quarters of 2018, WeWork generated $1.25 billion in revenues, but lost $1.22 billion.”
And then there is the recent controversy surrounding the company’s CEO, Adam Neumann, with regards to Neumann allegedly purchasing properties and then leasing them to his co-working business, creating what many people would categorize as a conflict of interest.
Aside from the financial problems WeWork has faced, just this past year, the company also received national media attention for claims that the company allegedly mishandled sexual assault reports in the workplace. WeWork issued a response, stating that these claims were inaccurate.
What’s WeWork’s solution to help alleviate these problems? Apparently, to change the name of the company altogether.
Recently, WeWork has embarked on a rebranding effort, calling itself “the we company” and appears to be using this brand name as a vehicle for shifting away from being viewed strictly as a co-working real estate company, but rather an organization that can operate in other sectors as well.
Typically, a rebranding campaign by a company would not receive much flak in the press. However, the new branding efforts by WeWork have opened a fresh new line of criticism — particularly given that WeWork’s new brand name already exists.
Not only is the WE name already owned by the well-known Toronto-based global charity — the WE Organization — WeWork appears to be using this name to move into the same sectors in which WE (the nonprofit organization) already has a presence. WeWork, for example, is apparently using business lines, such as WeLive and WeGrow, that sound very similar to WE’s businesses.Comment on this story
Companies certainly have the right to pursue opportunities in other sectors from which they initially were formed. However, given WeWork’s efforts to champion the company’s social climate as well as WeWork’s track record of lawsuits and other branding-related issues, the mere appearance of WeWork trying to steamroll a charity that operates in similar sectors out of its long-established brand is not the best look for WeWork at the moment.
There is support among members of the Utah business community for WeWork’s expansion into the state. However, as WeWork looks to continue to grow, the company should focus on fixing its internal infrastructure — not what name appears on the sliding glass doors of its co-working office spaces.