WeWork’s $9B public debut


March 29, 2021

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We Working It Out
wework logo

Getty Images / Michael Kovac)

WeWork is going public via a SPAC

Well, this is embarrassing.

A few months ago — in the middle of the special purpose acquisition (SPAC) craze — we said that if WeWork went public via a SPAC, we would shut down.

Oops.

WeWork announced plans to go public

It will do so in a merger with BowX Acquisition, a SPAC backed by NBA legend Shaquille O’Neal.

According to CNBC, the deal will value the coworking startup — which mainly leases office space and rents it out in smaller parcels — at $9B, including debt.

This is a slight haircut from its $47B valuation in fall 2019 when full of BS charismatic founder Adam Neumann was burning billions of dollars from SoftBank.

For SoftBank, which put $10B+ into WeWork, it’s a somewhat miraculous save.

At its bubbliest valuation…

WeWork convinced the world it was a tech company. Under the leadership of CEO Sandeep Mathrani, it’s now just an office rental play.

Among the highlights from WeWork’s announcement:

  • The company dropped or amended leases for 200+ locations (today, it has 851 locations in 152 cities).
  • It shifted its focus to enterprise companies, which now make up >50% of the client base (up from 10% in 2015).
  • It survived 2020 with revenues of $3.2B (unchanged from 2019) even as the world went remote.

The company is still billions in the red. But with the world slowly moving back to a hybrid work arrangement, its plug-and-play office space offering is well-positioned to bounce back.

As for The Hustle, we are not going anywhere. If we left, who would be around for Adam Neumann’s next crazy venture?

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Snippets
  • Motel for sale: The actual Rosebud Motel from the hit TV show “Schitt’s Creek” is on the market for $1.6m.
  • More Amazon drama: Amazon is being sued over a claim that one of its California fulfillment centers failed to give workers required 30-minute lunch breaks.
  • Cool ag-tech: Pure Harvest Smart Farms — an Abu Dhabi-based agricultural tech startup — has raised $60m to grow food in the desert.
  • $20 after taxes: One person in Florida drew 6 winning numbers and won a $238m Powerball jackpot.
  • In the green: Lawmakers in New York agreed on a deal to legalize marijauna last week for the 21+ crowd. It has the potential to create a $4.2B industry in the state.
  • Zoom doom: Citigroup is introducing “Zoom-free Fridays” in a bid to reduce burnout and tech fatigue among its workforce.
Emerging Tech
EVs

Photo: Andreas Rentz/Getty Images

The EV delivery market is charging up

In just a few short months, 2021 has witnessed a push for electric vans that shows no signs of running low on power.

Between the pandemic’s ecommerce boom and broader efforts to reduce carbon emissions, the EV delivery market is getting hot.

Nearly all major players are putting the pedal to the metal:

  • Amazon is buying 100k Rivian-built vans
  • FedEx recently promised an all-electric fleet by 2040
  • UPS ordered 10k EVs from UK-based startup Arrival
  • DHL says EVs now make up at least 1/5 of its fleet

Ford is investing $100m in a Missouri plant as it preps to mass produce its E-Transit van, and the US Postal Service has plans to electrify 10% of its fleet.

By 2030, consulting firm Guidehouse Insights forecasts 190k electric delivery vans will be built each year globally.

But delivery trucks aren’t the only ones electrifying:

  • Guidehouse also estimates 600k electric utility trucks will be built annually by 2030.
  • New York-based energy giant Con Edison has announced plans to electrify its fleet of electric bucket trucks.
  • Montgomery, Alabama’s public school system approved a contract for a massive fleet of electric school busses.
  • Last year, Los Angeles announced it would electrify its entire fleet of garbage trucks by 2035.

Bottom line: Teslas may have held the stage for the last couple years, but EV trucks and vans are riding into the spotlight.

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Tales from the crypto
BTC

Photo: Dan Kitwood/Getty Images

Morocco is seeing a huge surge in cryptocurrency use

In 2017, Morocco banned the use of cryptocurrencies.

News flash: it didn’t work.

New data from LocalBitcoins, a peer-to-peer crypto market, shows that trading in Morocco is up ~4x over the last 9 months.

What’s driving this?

For starters, only ~29% of adults in Morocco have a bank account.

One surprising reason for this is that many Moroccans don’t want their neighbors to know they have money.

In 2008, Morocco’s largest bank found that while people wanted savings accounts, they vehemently rejected the idea of mailed bank statements, fearing privacy issues.

While bitcoin transactions live on a public ledger that anyone can see, the blockchain offers complete anonymity.

How are Moroccans bypassing anti-crypto laws?

There are many ways for people to skirt these kinds of regulations:

  • Using peer-to-peer crypto marketplaces like LocalBitcoin, which allow users to buy BTC from other people online using cash.
  • Hopping the border (either physically or with a VPN) and buying in a country where it’s legal.
  • Some major crypto exchanges, like Binance, allow users to exchange Moroccan dirham to cryptocurrency, but not vice versa.
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Word of the day
Poka-Yoke

Idiot proof (Source: Fractory)

Soak your mind on this: Poka-Yoke. It’s a Japanese term that roughly translates to “mistake-proofing” or “avoiding an unthinkably bad move.”

The term was coined by Shigeo Shingo in the 1960s as part of the Toyota Production System. Poka-Yoke is a streamlined process to prevent incorrect usage by a user.

Shingo first suggested the idea when watching factory workers continually fail to assemble a switch. They’d often forget a spring.

Instead of blaming the workers, Shingo proposed changing the assembly process to ensure the springs were never forgotten. It worked.

And once you learn about it, Poka-Yoke is everywhere. USB ports and the shape of SIM cards force the user to put them in correctly. Microwaves won’t run when the door is open. The list goes on…

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