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Report: WeWork cofounder Adam Neumann may have to unload property to pay off a giant loan

Adam Neumann may be out of the daily flow of WeWork, but he seemingly remains top of mind to some of the company’s bankers.

According to a new Business Insider piece, Neumann is working with JPMorgan, UBS, and Credit Suisse to consider new terms for a $500 million loan that he took out before WeWork filed to go public, and from which Neumann has already drawn down $380 million. Since he can no longer pay the loan with proceeds from selling WeWork shares publicly (it yanked its S-1 filing earlier this week), he may have to put up some of his properties or other assets as collateral for the loan, according to one of BI’s sources.

“No terms have been set,” a spokeswoman for Neumann tells the outlet.

Per earlier reports, Neumann has plenty to offload if it comes to it, having acquired numerous residential and commercial properties over the years.

Among his reported investments is a $10.5 million Greenwich Village townhouse; a farm in Westchester, New York; a home in the Hamptons where he reportedly weathered the storm with his family ahead of resigning as CEO last week; and a $21 million, 13,000-square-foot house in the Bay Area with a guitar-shaped room.

According to an earlier WSJ report, Neumann has also bought several commercial properties through investor groups that he had leased back, in some cases, to WeWork.

WeWork, and Neumann, have both enjoyed a close relationship with JPMorgan in recent years. As recently reported in the NYTimes,  JPMorgan “lent Mr. Neumann money personally (with his inflated shares as collateral), provided equity and debt for the company, served as a corporate adviser for the I.P.O. and secured nearly $6 billion in financing as part of the now scotched offering.”

Researchers developed a sensing system to constantly track the performance of workers

Researchers have come up with a mobile-sensing system that can track and rate the performance of workers by combining a smartphone, fitness bracelets and a custom app.

The mobile-sensing system, as the researchers call it, is able to classify high and low performers. The team used the system to track 750 U.S. workers for one year. The system was able to tell the difference between high performers and low performers with 80% accuracy.

The aim, the researchers say, is to give employees insight into physical, emotional and behavioral well-being. But that constant flow of data also has a downside, and if abused, can put employees under constant surveillance by the companies they work for.

The researchers, including Dartmouth University computer science professor Andrew Campbell, whose earlier work on a student monitoring app provided the underlying technology for this system, see this as a positive gateway to improving worker productivity.

“This is a radically new approach to evaluating workplace performance using passive sensing data from phones and wearables,” said Campbell. “Mobile sensing and machine learning might be the key to unlocking the best from every employee.”

The researchers argue that the technology can provide a more objective measure of performance than self-evaluations and interviews, which they say can be unreliable.

The mobile-sensing system developed by the researchers has three distinct pieces. A smartphone tracks physical activity, location, phone use and ambient light. The fitness tracker monitors heart functions, sleep, stress and body measurements like weight and calorie consumption. Meanwhile, location beacons placed in the home and office provide information on time at work and breaks from the desk.

From here, cloud-based machine learning algorithms are used to classify workers by performance level.

The study found that higher performers typically had lower rates of phone usage, had longer periods of deep sleep and were more physically active.

Privacy experts and labor advocates have long raised concerns about the practice of tracking employees. That hasn’t stopped companies from incentivizing employees to wear fitness tracks in exchange for savings on insurance or other benefits. Startups have popped up to offer even more ways to track employees.

For instance, WeWork acquired in February Euclid, a data platform that tracks the identity and behavior of people in the physical world. Shiva Rajaraman, WeWork’s chief product officer, told TechCrunch at the time that the Euclid platform and its team will become integrated into a software analytics package that WeWork plans to sell to companies that aren’t renting WeWork space but want to WeWork-ify their own offices.

Meanwhile, the team of researchers suggests that while its system of continuous monitoring via wearables and other devices is not yet available, it could be coming in the next few years. It’s unclear if the team is making a calculated guess or if there are designs to try and launch this system as a product.

The team, led by Dartmouth University, included researchers from University of Notre Dame, Georgia Institute of Technology, University of Washington, University of Colorado Boulder, University of California, Irvine, Ohio State University, University of Texas at Austin and Carnegie Mellon University .

A paper describing the study will be published in the Proceedings of the ACM on Interactive, Mobile Wearable and Ubiquitous Technology.

WeWork acquires Waltz, an app that lets users access different spaces with a single credential

WeWork announced today that it will acquire Waltz, a building access and security management startup, for an undisclosed amount. Waltz’s smartphone app and reader allows users to enter different properties with a single credential and will make it easier for WeWork’s enterprise clients, such as GE Healthcare and Microsoft, to manage their employees’ on-demand memberships to WeWork spaces.

WeWork’s announcement said “with deep expertise in mobile access and system integrations, Waltz has the most advanced and sophisticated products to provide that single credential to our members and to help us better connect them with our spaces.” Waltz was founded in 2015 by CEO Matt Kopel and has offices in New York and Montreal. After the acquisition, Waltz will be integrated into WeWork, but maintain its current customer base.

WeWork has been on an acquisition spree over the past year as it evolves from co-working spaces to a software-as-a-service provider. Companies it has bought include office management platforms Teem (for $100 million) and Managed by Q, as well as Euclid, a “spatial analytics platform” that allows companies to analyze the use of workspaces by their employees and participation at meetings and other events.

Likewise, Waltz isn’t just an alternative to keys or access cards. Its cloud-based management portal gives companies data about who enters and exits their buildings and also allows teams to set “Door Groups,” which restricts the use of some spaces to certain people. According to Waltz’s help site, it can also be used to make revenue through ads displayed in its app.

The Wing poaches Snap’s comms director

Women-focused co-working space The Wing has hired Rachel Racusen as vice president of communications. Racusen has been the director of communications at Snap, the developer of Snapchat, since late 2016.

Racusen’s exit represents the latest in a series of departures at the “camera company.”

Earlier this year, the company’s chief financial officer Tim Stone stepped down. Shortly after, The Wall Street Journal reported that Snap had fired its global security head Francis Racioppi after an investigation uncovered that he had engaged in an inappropriate relationship with an outside contractor. Snap CEO Evan Spiegel reportedly asked the company’s HR chief Jason Halbert to step down as a result of the investigation’s findings.

Racusen worked under Snap’s chief communications officer Julie Henderson, who had joined late last year from 21st Century Fox.

Racusen has a history in politics similar to several other executives at The Wing. Ahead of her Snap tenure, she served as the associate communications director under President Barack Obama . Before that, she was a vice president at MSNBC and the public affairs firm SKDKnickerbocker, where The Wing co-founder and chief executive officer Audrey Gelman worked prior to launching her business.

Four months after closing a $75 million Series C, The Wing is making two other key additions to its management team. The company has brought on Nickey Skarstad as vice president of product and Saumya Manohar as general counsel. Skarstad joins from Airbnb, where she was a product lead on the Airbnb Experiences team. Saumya Manohar spent the last three years as Casper’s vice president of legal.

Backed by Sequoia Capital, Upfront Ventures, NEA, Airbnb, WeWork and others, The Wing has raised more than $100 million to date.

“We’re thrilled to be bringing this group of seasoned and talented women to build out our executive team,” Gelman said in a statement. “The Wing is the perfect home for leaders who thrive on fast growth and want to combine their social values with their work practice.”

Brex has partnered with WeWork, AWS and more for its new rewards program

Brex, the corporate card built for startups, unveiled its new rewards program today.

The billion-dollar company, which announced its $125 million Series C three weeks ago, has partnered with Amazon Web Services, WeWork, Instacart, Google Ads, SendGrid, Salesforce Essentials, Twilio, Zendesk, Caviar, HubSpot, Orrick, Snap, Clerky and DoorDash to give entrepreneurs the ability to accrue and spend points on services and products they use regularly.

Brex is lead by a pair of 22-year-old serial entrepreneurs who are well aware of the costs associated with building a startup. They’ve been carefully crafting Brex’s list of partners over the last year and say their cardholders will earn roughly 20 percent more rewards on Brex than from any competitor program.

“We didn’t want it to be something that everyone else was doing so we thought, what’s different about startups compared to traditional small businesses?” Brex co-founder and chief executive officer Henrique Dubugras told TechCrunch. “The biggest difference is where they spend money. Most credit card reward systems are designed for personal spend but startups spend a lot more on business.”

Companies that use Brex exclusively will receive 7x points on rideshare, 3x on restaurants, 3x on travel, 2x on recurring software and 1x on all other expenses with no cap on points earned. Brex carriers still using other corporate cards will receive just 1x points on all expenses.

Most corporate cards offer similar benefits for travel and restaurant expenses, but Brex is in a league of its own with the rideshare benefits its offering and especially with the recurring software (SalesForce, HubSpot, etc.) benefits.

San Francisco-based Brex has raised about $200 million to date from investors including Greenoaks Capital, DST Global and IVP.  At the time of its fundraise, the company told TechCrunch it planned to use its latest capital infusion to build out its rewards program, hire engineers and figure out how to grow the business’s client base beyond only tech startups.

“This is going to allow us to compete even more with Amex, Chase and the big banks,” Dubugras said.

WeWork China raises $500M to triple the number of cities it covers

WeWork’s China business is getting a fresh injection of capital after it raised $500 million.

The company entered China two years ago and today it covers Beijing, Shanghai and Chengdu with nearly 40 locations. It claims 20,000 members, and it is also active in Hong Kong, which technically falls under ‘Greater China.’

The new capital comes from Trustbridge Partners, Singapore’s Temasek, SoftBank, SoftBank’s Vision Fund and Hony Capital. WeWork said it’ll be used for expansion into six new cities: those are Shenzhen, Suzhou, Hangzhou, Chengdu, Nanjing, and Wuhan. This new raise is a Series B, WeWork China previously scored a $500 million Series A last year, which was also when the Chinese entity was founded.

The company has been pretty busy over that 12-month period, most notably it scooped up its largest rival, Naked Hub, in an acquisition deal that is worth a reported $400 million and massively grew its reach.

Naked Hub builds on WeWork’s presence in Greater China by adding 24 office locations and a further 10,000 members. That’s why WeWork China’s figures are so impressive for just two years of operations. Now, this new capital will put WeWork’s own DNA into that network through this planned expansion spree.

“This investment will help WeWork fuel our mission to support creators, small businesses, and large companies across China,” WeWork CEO and co-founder Adam Neumann said in a statement. “WeWork has built an incredible team in China that supports our members every day, serving as a bridge for local companies who want to reach the world as well as for global companies that want to enter the Chinese market.”

Outside of China, WeWork is also making inroads in India — where it launched in 2017 — Korea, Japan (where it operates a joint venture with SoftBank) and Southeast Asia, where it made an acquisition to kick-start its presence. Indeed, WeWork has a float of around $500 million for its operations in Southeast Asia and Korea, although the total pot for India is unknown at this point.

WeWork China’s big raise comes days after Hong Kong’s Campfire pulled in $18 million and Awfis in India raised $20 million.

WeWork confirms deal to buy Naked Hub, one of its main competitors in China

WeWork is buying up one of its largest competitors in China after it announced a deal to acquire Naked Hub.

The deal was widely reported by Chinese media yesterday, but WeWork has now confirmed it through a blog post from its CEO Adam Neumann. Terms of the transaction are not disclosed but Bloomberg reported that it is worth around $400 million.

Naked Hub is an offshoot of China-based luxury resort company Naked Group that was started in 2015 by Grant Horsfield and Delphine Yip-Horsfield. The company is primarily anchored in China, with most of its locations in Beijing and Shanghai, but it has expanded into Australia, Hong Kong and Vietnam. All told, it claims to have 10,000 members across its 24 office locations.

Even though a deal to merge with Singapore-based JustCo was called off, Naked Hub had emerged as one of WeWork’s fiercest competitors in China with the ambition to continue that battle in Southeast Asia and other markets, as I wrote last year.

WeWork isn’t commenting at this point about how it plans to integrate the two brands, but its CEO Neumann paid tribute to the Naked Hub business.

“We have found an equal who shares our thinking about the importance of space, community, design, culture, and technology. Together, I believe we will have a profound impact in helping businesses across China grow, scale, and succeed,” he wrote.

“China-born naked Hub and WeWork may come from vastly different backgrounds, but there is more that binds us than separates us. The values we share toward creating a vibrant community for our members by using design, technology, and hospitality are core to how both companies are successful,” said Horsfield, Naked Group’s founder and chairman.

Naked Hub may be a growing threat to WeWork China, but it is far from the only major competitor. Unicorn Ucommune — which changed its name from URwork following a lawsuit from WeWork — is perhaps the largest profile Chinese challenger.

WeWork launched in China in 2016 via Shanghai. Today it said it has 13 locations in Greater China with plans to increase that to more than 40 by the end of this year. That’s a move that it said will quadruple its membership numbers in China from 10,000 to 40,000.

The deal is WeWork’s second acquisition of a competitor in Asia, its first being a deal to buy SpaceMob, a then 1.5-year-old company in Singapore, last year.

The company has been lining its pockets to fuel a big push into Asia.

Last year, the firm span out a WeWork China entity backed by $500 million from investors, while capital also went to WeWork Japan — a unit that investor SoftBank owns half of — and WeWork Pacific, its business focused on Southeast Asia and other parts of the region which also got a $500 million to spend. All of that capital was part of a $4.4 billion investment round in WeWork from SoftBank.

WeWork has big plans for Alexa for Business

 Amazon is soon to announce Alexa for Business, and WeWork is one of the first partners to have hopped on the platform. WeWork’s vision is to use technology to help businesses make the most out of their physical space, all while customizing that space to each individual’s personal needs. The co-working giant has been on the Alexa for Business platform for about a month now, as part… Read More