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What's wrong with WeWork?

Author

Sophia Sparks

Published Mar 01, 2026

What's wrong with WeWork?

The real problem with WeWork is that its whole business model is flawed with excessive leverage. Like an insolvent bank with long term assets but short-term funding, WeWork is subject to the proverbial “run-on-the-bank” risk because of its massive long-term lease liabilities.

Keeping this in view, what's wrong with WeWork?

The real problem with WeWork is that its whole business model is flawed with excessive leverage. Like an insolvent bank with long term assets but short-term funding, WeWork is subject to the proverbial “run-on-the-bank” risk because of its massive long-term lease liabilities.

Additionally, why do coworking spaces fail? Although the trend of coworking spaces seems to be growing without limit, many spaces still have failed. Some of the coworking space fail incidents are due to a lack of planning or advertising, while others tried to open in a location that was already overcrowded or where there was no demand.

Secondly, is WeWork a failed concept?

The popular coworking space WeWork has had its valuation fall by 90% and its IPO cancelled. 21, 2019), or about one-fifth of its work force, WeWork appears to have failed as the spectacular growth company it once appeared to be.

How much is WeWork worth now?

The valuation is a sharp fall from WeWork's private valuation of $47 billion in 2019.

Why is WeWork not profitable?

This company does not make money

WeWork makes a pro forma net loss on its bottom line, has growing losses on its preferred profitability metric, is not cash-flow positive, and has operating expenses greater than its deferred-rent cash flow. No part of this company actually makes money.

Did WeWork go out of business?

ReWork. WeWork had $1.3 billion of long-term debt when it issued its prospectus last year, including credit agreements with JPMorgan and $669 million in corporate bonds. To be clear, WeWork has made no public plans to file for bankruptcy, and that option is by no means an inevitability.

Why was WeWork overvalued?

A recent CNBC story said that SoftBank chief executive officer, Masayoshi Son's optimism in WeWork's growth potential, and a lack of dissenting viewpoints also led to the company being overvalued.

Why did Weworks IPO fail?

While most Wall Street savants think WeWork's failed initial public offering was a harbinger of things to come in the IPO market, the truth is that the reason for the failure lies in WeWork's untested and fatally flawed business model. WeWork isn't just a tenant — it is also a landlord.

How does WeWork make money?

It makes money by renting office space. WeWork purchases real estate space—sometimes just a floor or two in an office building—and transforms it into smaller offices and common areas. Members include independent freelancers and remote workers who need an occasional office away from home.

How much is WeWork monthly?

WeWork membership costs $45/month. If you want to rent a desk for a day it's $50 plus the membership fee. $350/month gets you unlimited access to the shared workspaces but a dedicated desk will cost you anywhere from $275 to $600/month (depending on the office location, demand, etc.).

Is WeWork a good company to work for?

The people at WeWork are the best you will ever meet. Every employee was extremely driven, customer-focused, and intelligent. Awesome place to work, people are friendly, the ambiance is good and the culture is perfect. The company is very supportive to its employees and giving enough benefits.

Why is WeWork so expensive?

More expensive- WeWork can be considerably expensive as compared to local coworking spaces. Since it is a global chain, they have higher operating costs as compared to local coworking spaces.

Are coworking spaces profitable?

According to a survey completed by DeskMag, only 40% of coworking spaces are currently profitable. With new coworking spaces opening up nearly every day, it might take them a few months to start to make a profit. After two years in operation, more than 70% of all coworking spaces become profitable.

Who needs coworking space?

Occupants typically are freelancers, entrepreneurs, start-ups and small teams who want to take advantage of a flexible space. In addition to culture, cost is another big draw. One of the advantages of these spaces is the ability to rent out only what you need vs an entire private office space, which can be costly.

How much does it cost to start a coworking space?

Different coworking space pricing based on desk type
Coworking servicesPrice
Part-time desk – monthly membership$350-$400 per month
Permanent desk$650-$750 per month
Private office: up to 20 staff$160-$210 per square metre per month
Private office: 20-50 staff$150-$200 per square metre per month

Who is WeWork's biggest competitor?

WeWork's Top Competitors-2019
  • Regus.
  • Impact Hub.
  • Industrious.
  • Knotel.
  • Spaces.
  • District Cowork.
  • Serendipity Labs.
  • Venture X.
Some of the reasons for the growing popularity of coworking places include: They offer a professional setup for your business providing you a really nice place to meet your clients rather than “that random corner of a coffee shop”. They help you in networking with the related people in your field.

How can I get WeWork for free?

How to Get Your Membership for Free. Getting a free, year-long WeWork hot desk membership is easy: just open a Business Platinum Card® from American Express.

How do you run a successful coworking space?

Here are a few tips on how to run a successful coworking space.
  1. Research your clients. In order to run a successful business that provides office space, you must research both the current market and your potential clients.
  2. Equip your offices.
  3. Choose the right location.
  4. Market your business.
  5. Host networking events.

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