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Home Business

WeWork’s Competition: You

by Cecilia Amador de San José
July 15, 2016
in Business
Reading Time: 2 mins read
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In a recent article, The Wall Street Journal stated that WeWork, unlike companies such as Uber and Airbnb, is highly susceptible to competition the more the demand for flexible workspace grows.

Their claim is that, “the market’s rapid growth underscores a big challenge for WeWork: low barriers to entry. Competition can come from anyone who has a lease and the money to set up offices.” They’re right, and this can be seen by the amount of coworking spaces that have ‘popped up’ these past few years.

Coworking expert, Steve King, mentioned how throughout the U.S. only, coworking spaces rose from about 250 in 2010 to a whopping 3,000 in 2015. Which makes Simon Gunnis’ claim that 2016 will be the year 10,000 coworking spaces open their door a feasible one.

“Today, the co-working business is mushrooming. New locations pop up seemingly weekly in old warehouses and new skyscrapers alike as small and medium-size businesses eschew coffee shops and small offices for the incubator-like workspaces where members share common spaces.” -WSJ

But WeWork isn’t the only one addressing this shared space demand. Independent operators dominate some local and suburban markets, and apps like Croissant and perks like the coworking visa allow for independent operators to compete with the likes of WeWork. Even so, WeWork remains positive that they will remain unmatched–at least for the time being.

“Scale matters,” said WeWork’s president Artie Minson to the Wall Street Journal. “The bigger you are, the cheaper it is for you to build, the more efficient you can build…the more financial flexibility you have to take deals.”

Minson isn’t the only one that believes that scale matters and will continue to matter in the future.  Harvey Spekav, chief executive of Equinox, anticipates large brands to dominate coworking in the future. Whether his prediction is right or not, only time will tell; but we are seeing how some coworking names are starting to expand into different cities and markets–like Industrious and Spaces.

Nonetheless, independent coworking operators will continue to have a market to cater to. If flexible work options continue to grow (like they are expected to), then the need for space will only rise–and like Richard Morris, from Regus once said: “I believe independents will always thrive – they know their local market and they have developed a good reputation within their regional area.”

Click here to read the full Wall Street Journal article.

 

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Cecilia Amador de San José

Cecilia Amador de San José

Cecilia Amador de San José, Senior Associate Editor of Allwork.Space, is based from wherever her laptop is. She enjoys traveling and visiting new flexible workspaces. If you'd like Ceci to check out your workspace, feel free to reach out to her at [email protected] (and send a plane ticket).

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