[rtpg]

I am not a fan of the WeWork business and would bet on its failure, but I don't think that one can just say that "this company is $5 billion, so this is the cap of how big such a company in this market can become."

Just as a thought experiment, imagine that Regus ended up just straight out getting all of WeWork's assets in some sort of liquidation, and half the tenants stayed. They would get bigger!

There is a possibility that WeWork can tap into more interesting markets.

Purely annecdotal, but the people I hear about who ending up in WeWork used to be in either dirt cheap local coworking spaces, or just getting their own offices. It does feel like a "pie got bigger" sort of thing, that wasn't before captured by such a large player.

[jimmywanger]

Perhaps I was not precise in my wording. With the way WeWork currently works, and its asset allocation and fee structure, I don't think expansion or more market cap than Regus is possible.

If WeWork get all Regus assets for free and half their business, sure, why not? That would be an immediate 3-4 billion dollar injection. As it currently stands, their coolness(tm) is not enough to compensate for their bloated fees and limited office space locations.

[Breza]

I agree with you. WeWork doesn't have strong network effects and the business model is easy to copy. There are real estate companies that each owns tens of millions of square feet of office space. If WeWork really were worth $40 billion, the companies who own office buildings could just create their own coworking spaces and rake in the billions instead.