WeWork Picks Up Rival Coworking Company Spacious
Coworking giant WeWork continued its recent spree of acquiring companies, this time picking up rival Spacious, which offers shared workspaces during the daytime in existing restaurants, the companies announced today.
WeWork — which recently filed paperwork for its initial public offering (IPO) — bought the three-year-old Spacious for an undisclosed amount, marking WeWork’s sixth acquisition of a start-up this year.
“Spacious’s team and real estate and operational expertise will help enable WeWork to continue to give our members access to the workspace they want, when they need it,” Chris Hill, WeWork’s chief product officer, said in a statement. “We’re thrilled to welcome Spacious to WeWork.”
The New York City-based Spacious was founded in 2016 by Preston Pesek and Chris Smothers with the idea to turn restaurants into coworking spaces during the daytime when the eateries sit empty. Memberships start at $99 a month and go up to $129 a month.
Spacious raised a total of $15 million since it launched and has converted more than 25 restaurants in New York and San Francisco into workspaces. Last year, the company started a push into dedicated occupancy and leased the entire 8,500-square-foot building at 34 Union Square East that formerly housed TGI Fridays in November, as Commercial Observer previously reported.
“In WeWork, we have found much natural alignment across our visions for the integration of work, technology and physical space,” Pesek wrote in a blog post about the acquisition. “We’re thrilled for the opportunity to continue to serve our members at Spacious today as part of the greater WeWork community.”
A spokesman for WeWork declined to comment on specifics about how the two companies will merge after the acquisition.
Spacious’s acquisition is the latest in a series of purchases WeWork — which recently rebranded as The We Company — made as it continues to move past the shared-office business it started with. This year, WeWork bought data platform Euclid, office management start-up Managed by Q, building access developer Waltz, mobile application maker Prolific Interactive and real estate planning platform Space IQ for undisclosed amounts.
Previously, WeWork bought social network Meetup for around $200 million in 2017 and office management software developer Teem for $100 million in cash in September 2018, according to Axios and TechCrunch.
The coworking behemoth also filed plans earlier this month to raise $1 billion through an IPO, though that targeted figure can often fluctuate. WeWork said proceeds will be used for general corporate purposes including working capital, operating expenses and capital expenditures.
WeWork’s IPO filings showed that as the nine-year-old company continued its rapid expansion and increased its revenues, its losses surged to $1.6 billion last year with the number likely to keep growing.
In the first six months of this year, WeWork had $1.5 billion in revenue but posted a net loss of $690 million, an increase from the net losses of $628 million on $764 million of revenue during the same time last year.