A new infusion of $3 billion from SoftBank Group Corp. into WeWork will more than double the shared-office provider’s valuation to $45 billion, up from $20 billion. The fundraising would push WeWork past Airbnb as the second-most valuable U.S. startup, behind Uber, The Wall Street Journal noted. WeWork’s business—leasing office spaces to spruce up and slice up for companies to rent for shorter durations than typical leases—has required a steady dose of capital over the years. This won’t dispel concern about the company’s accumulation of losses.
As Silicon Valley startups are learning, having SoftBank as a financial ally can allow firms to sink more money to grow expensive businesses. WeWork faces stronger competition lately from a small cohort of smaller competitors such as Industrious and Knotel, as well as landlords like Boston Properties and Tishman Speyer that are creating their own flexible-office businesses. Meanwhile, WeWork has looked to diversify into leasing to larger companies and providing other workplace service.