Dr. Gleb Tsipursky – The Office Whisperer
Nirit Cohen – WorkFutures
Angela Howard – Culture Expert
Drew Jones – Design & Innovation
Jonathan Price – CRE & Flex Expert
Beijing-based coworking firm Ucommune has filed to go public in the U.S. this month, despite its main competitor WeWork failing to do so just months ago.
While it would be safe to assume companies would take a step back from IPO talks after WeWork’s debacle, especially those with not-so-great economics, Ucommune needs cash.
The final private round valued the company at $3 billion and in discussing its model, it claimed it uses an “asset-light model” that is strikingly similar to that of WeWork’s.
Ucommune has two main businesses that include its coworking spaces and slightly more optimistic marketing services.
The company’s $58.7 million in coworking revenue during the first nine months of 2019 was offset by the $49.6 million in lease costs. On the other hand, its $56.5 million in revenue from its marketing side was offset by $51 million in revenue costs.
Still, the company has burned through $32.4 million in the first three quarters of the year and if it keeps this up, it will not have enough cash to last through the end of Q2 2020.
While all signs are pointing to disaster, the company does have one thing going for it — growth. The company’s revenue grew from ¥282.2 million in the first three quarters of 2018 to ¥874.6 million over the same time period in 2019. Yet, this does not make up for the fact that Ucommune lost more money this year than the last, so why would this company seem appealing to anyone given the circumstances?
