WeWork Files for IPO
The We Company, rebranded from WeWork, filed its first S-1 form with the U.S. Securities and Exchange Commission (SEC) regarding its initial public offering (IPO). No pricing details were mentioned in the filing, although the offering is valued up to $1.0 billion. The company has yet to decide where to list its shares, but it plans to list under the symbol WE.
The underwriters for the offering are JPMorgan, Goldman Sachs, Merrill Lynch, Barclays, Citigroup, Credit Suisse, HSBC Securities, UBS and Wells Fargo.
WeWork rents out co-working spaces to startups, freelancers and enterprises in some of the most expensive markets and makes money back over time as companies and individuals pay their rent or membership.
The company was founded early 2010, and over the past nine years it has rapidly scaled its business. Today, the global platform integrates space, community, services and technology in over 528 locations in 111 cities across 29 countries. The 527,000 memberships represent global enterprises across multiple industries, including 38% of the Global Fortune 500.
WeWork expects to expand aggressively in its existing cities, as well as launch in up to 169 additional cities. Based on data from Demographia and the Organization for Economic Cooperation and Development, the firm has identified its market opportunity to be 280 target cities with an estimated potential member population of roughly 255 million people in aggregate.
In a report, CNBC had this to say about WeWork’s finances:
In the filing, the company reported revenues of $1.54 billion and a net loss of more than $900 million for the first six months of 2019. By comparison, another tech titan that went public this year, Uber, had a loss of $5 billion in the second quarter, largely due to stock based compensation from the IPO.
The company intends to use the net proceeds from this offering for general corporate purposes, including working capital, operating expenses and capital expenditures.