WeWork to raise money at $15-20b company value

Adam Neumann (right) and Miguel McKelvey

The US high-tech workspace real estate company plans a second building in Tel Aviv, and Beersheva and Jerusalem centers.

US company WeWork, which provides shared workspace, community, and services for entrepreneurs, freelancers, startups and small businesses is set to raise money again, this time at a company value of $15-20 billion, sources inform "Globes." This will be the third financing round for the company that was founded in 2010 in new York by Israeli Adam Neumann and his American partner Miguel McKelvey.

In December 2014, WeWork completed a financing round of $355 million at a company value of $5 billion, while in June 2015, the company raised a further $400 million at a company value of $10 billion. In February 2014, the company was worth just $1.5 billion.

The company's investors include backers with deep pockets such as Fidelity Management, Goldman Sachs, JP Morgan, T Rowe Price, Wellington Management, Benchmark and more. WeWork declined to comment regarding a further financing round.

Behind WeWork's astronomical success within less than five years are the communities of over 16,000 tenants that it has created in its offices around the world. The company allows, through an app it has developed, to respond to requests from its communities whether it concerns product design and management, or venture capital and investment.

The ownership of the buildings that WeWork leases can be divided into three models: full ownership, renting, and business collaboration with the property's owners; this later model is used by Ampa Real Estate in Israel. The buildings in which WeWork operates undergo renovations so that they are upgraded and redesigned to the company's work collaboration space standards.

The company expects its community to rise from 16,000 at the end of 2014 to 260,000 in 2018. Over that period the number of buildings it owns will have risen from 24 to 376.

Operations in Israel

The company is also greatly expanding its operations in Israel. It already operates buildings in Tel Aviv's Dubnov St. and in Herzliya Pituah and is set to open offices in Tel Aviv's Sarona Center, the Beersheva High-Tech park, and after that in Jerusalem. This is in addition to 50 other sites in the US, UK and Netherlands.

WeWork Israel's director is Benjamin Singer and tenants include Uber, the 8200 entrepreneurship program and other bodies. Rents start from NIS 1,750 per month for an individual person through to NIS 15,400 for a company with 9 people.

Published by Globes [online], Israel business news - www.globes-online.com - on October 20, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

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Adam Neumann (right) and Miguel McKelvey
Adam Neumann (right) and Miguel McKelvey
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