JUNE 07, 2019 CLARE KENNEDY
Here's What Else WeWork's $47 Billion Valuation Would BuyFive Things That Put the Shared Office Provider's Potential IPO in PerspectiveThe New York City headquarters of WeWork, cofounded by Miguel McKelvey (above) and Adam Neumann. Photo: WeWorkIn the run up to WeWork's initial public offering, speculation about the coworking-coliving-coding school giant's true worth is flying fast and furious.
The figure discussed most is $47 billion, a valuation by the venture capital world based on it raising more than $12.8 billion in funding, and Soft Bank investing a total of about $10 billion for its minority stake of more than 20 percent. While some estimates are a couple of billion higher or lower, that most common $47 billion number puts it among the highest valuations for a private startup. The valuation is a source of discussion unto itself, apart from the long-standing debate over whether the company's rapid growth strategy could result in a coup for office space or sink it entirely.
Chief Executive Adam Neumann said he has "zero worry" about how the IPO will come off, according to an article in the New York Times. The shared office space company, founded in 2010, grew by leasing office space from landlords, then upgrading the space with amenities to sublease it out to individuals and businesses on flexible terms; it's now also offering shared apartments, management services and the Flatiron School for coding. The concern: Whether in a bad economy clients would simply not renew short-term leases and have workers toil from home or some other less costly place than a shared downtown office.
The $47 billion can be hard to grasp in the abstract, so here are some other ways to consider it:
WeWork Divided By Population
How well would citizens make out if they divided the sum equally among themselves? The total U.S. population as of last July was a little over 327 million, but 22.6 percent of those people were under 18. Excluding kids, the loot could be divided between about 253 million people, which would give each of person $185.60. In case you were wondering, that's enough for a mid-week, one-night stay at the Howard Johnson in the Bronx, with enough left over to tip the cleaning staff.
Compared to the Net Worth of Moguls
If a man is his money, then WeWork's estimated valuation is worth about one-third of Jeff Bezos' net worth, if calculated on his $150 billion net worth prior to divorce proceedings which began in January, and 0.42 of a Bezos after. It is also equivalent to 0.47 of a Bill Gates (Net worth: $100 billion), 0.55 of a Warren Buffet (Net worth: $85 billion), 0.68 of a Mark Zuckerberg (Net worth: $69 billion). Then there is the Saudi Royal family, which claims to have a net worth of $1.5 trillion altogether, about 32 times WeWork's valuation.
And to the Typical American Family
The median household income in the United States was $61,372 annually in 2017, the latest year available according to the U.S. Census Bureau. Based on those numbers, $47 billion could sustain 765,821 families in that pay range for a full year.
What $47 Billion Buys in Real Estate
In We Co.'s own backyard, New York City, the money would go pretty far, even considering the rarefied nature of the real estate market there. It could pay for the largest development right now , the $25 billion Hudson Yards, a 28-acre neighborhood built into a working rail yard on the West Side of Manhattan, with some left over for a more modest sized sequel. Or it could fund the purchase of 19 Chelsea Markets (which Google bought for $2.4 billion in cashin 2018).
Various other items valued at $47 Billion
Here's What Else WeWork's $47 Billion Valuation Would BuyFive Things That Put the Shared Office Provider's Potential IPO in PerspectiveThe New York City headquarters of WeWork, cofounded by Miguel McKelvey (above) and Adam Neumann. Photo: WeWorkIn the run up to WeWork's initial public offering, speculation about the coworking-coliving-coding school giant's true worth is flying fast and furious.
The figure discussed most is $47 billion, a valuation by the venture capital world based on it raising more than $12.8 billion in funding, and Soft Bank investing a total of about $10 billion for its minority stake of more than 20 percent. While some estimates are a couple of billion higher or lower, that most common $47 billion number puts it among the highest valuations for a private startup. The valuation is a source of discussion unto itself, apart from the long-standing debate over whether the company's rapid growth strategy could result in a coup for office space or sink it entirely.
Chief Executive Adam Neumann said he has "zero worry" about how the IPO will come off, according to an article in the New York Times. The shared office space company, founded in 2010, grew by leasing office space from landlords, then upgrading the space with amenities to sublease it out to individuals and businesses on flexible terms; it's now also offering shared apartments, management services and the Flatiron School for coding. The concern: Whether in a bad economy clients would simply not renew short-term leases and have workers toil from home or some other less costly place than a shared downtown office.
The $47 billion can be hard to grasp in the abstract, so here are some other ways to consider it:
WeWork Divided By Population
How well would citizens make out if they divided the sum equally among themselves? The total U.S. population as of last July was a little over 327 million, but 22.6 percent of those people were under 18. Excluding kids, the loot could be divided between about 253 million people, which would give each of person $185.60. In case you were wondering, that's enough for a mid-week, one-night stay at the Howard Johnson in the Bronx, with enough left over to tip the cleaning staff.
Compared to the Net Worth of Moguls
If a man is his money, then WeWork's estimated valuation is worth about one-third of Jeff Bezos' net worth, if calculated on his $150 billion net worth prior to divorce proceedings which began in January, and 0.42 of a Bezos after. It is also equivalent to 0.47 of a Bill Gates (Net worth: $100 billion), 0.55 of a Warren Buffet (Net worth: $85 billion), 0.68 of a Mark Zuckerberg (Net worth: $69 billion). Then there is the Saudi Royal family, which claims to have a net worth of $1.5 trillion altogether, about 32 times WeWork's valuation.
And to the Typical American Family
The median household income in the United States was $61,372 annually in 2017, the latest year available according to the U.S. Census Bureau. Based on those numbers, $47 billion could sustain 765,821 families in that pay range for a full year.
What $47 Billion Buys in Real Estate
In We Co.'s own backyard, New York City, the money would go pretty far, even considering the rarefied nature of the real estate market there. It could pay for the largest development right now , the $25 billion Hudson Yards, a 28-acre neighborhood built into a working rail yard on the West Side of Manhattan, with some left over for a more modest sized sequel. Or it could fund the purchase of 19 Chelsea Markets (which Google bought for $2.4 billion in cashin 2018).
Various other items valued at $47 Billion
- The amount of money raised by U.S. colleges and universities had raised over 2018 alone and, incidentally, also how much U.S. Sen. Bernie Sanders thinks it would cost each year to make public institutions of higher education tuition-free for undergraduates.
- How much U.S. consumers paid out of pocket for pharmaceuticals in a single year.
- China's investments in emerging industries and technology.
- The global auto industry's total annual advertising spending.
- Japan's latest defense spending bill.
- The estimated value of the U.S. market for legal cannabis.