Are you a business columnist writing on the internet? It’s time you weighed in on WeWork.
The latest piece worth reading came Tuesday from Ben Thompson of Stratechery, who makes the argument that the best bull case for WeWork stems from its resemblance to Amazon Web Services. Companies don’t really want to build up expertise in either running services or running their own offices, the thinking goes, giving these firms lasting advantages. It’s a prospect to consider.
Alex Danco, formerly of Social Capital, also gives the bull case a shot, pointing to WeWork’s “economic moat.” Sure, the company has $47 billion of lease liabilities, but challenging it would be “like the classic example of trying to fund a second storage locker business in a town that already has an existing, massive storage locker facility. There’s just no point,” he writes.
Pushback on WeWork abounds as well. Triton Research said in a report that WeWork’s IPO filing is a “masterpiece of obfuscation” because it doesn’t say much about the underlying unit economics of the business. Matt Levine of Bloomberg raised more corporate governance red flags, as well.