We work Inc.
hopes to boost its declining share price by joining the growing number of tech companies selling apps, data tools and other software to landlords and office tenants trying to adapt to the new world of hybrid workplaces.
Nine months after its IPO, in July, the shared workplace operator officially launched a service called WeWork Workplace, which includes the software tools WeWork has used to power its numerous locations. For the first time, WeWork now offers these tools to all tenants, regardless of WeWork membership.
WeWork executives say Workplace will help companies lure employees back to the office by giving their employees an app that allows them to book a meeting room, post a company announcement, or sign up for a yoga class, for example.
“Companies of all sizes recognize that people don’t come in every day,” said Scott Morey, WeWork’s president of technology and innovation. That turnaround in the workplace has created challenges that require digital solutions, he said.
But WeWork isn’t alone in seeking new business opportunities amid the pandemic-induced turmoil in the office space industry. Competitors also offering a range of apps, data, telecommunications and other software include technology companies such as Cisco Systems Inc.
and Honeywell International Inc.
and startups such as VTS and HqO.
“The race is still early,” said Mr Morey.
In the early stages of the pandemic, tech companies rushed to help companies deal with health, safety and telecommunications systems as workers switched to working from home almost overnight. For example, Heineken NV brewery used HqO’s office app to maintain a secure occupancy rate and maintain social distancing, says Stephan Ottenhoff, a digital and technology manager at Heineken in the Netherlands.
More recently, tech companies have been trying to help businesses and landlords deal with the slow reopening of traditional workplaces. Most companies have adopted hybrid strategies that combine office work with remote work, forcing management teams to rethink meeting rooms, design, security, scheduling, food, air quality, and other office needs.
Cisco is addressing this demand with a range of services, including its teleconferencing system that cancels background noise and a room management tool that tracks employee usage of meeting rooms and other office space. Cisco has added all of these technologies to its New York offices, which it uses as a showcase for the sale of these services.
has, meanwhile, attempted to gain market share with software such as People Counting, a tool that analyzes video from security cameras to keep a real-time log of how many people enter and exit the office.
Other tech companies are helping companies and landlords persuade employees to return to their offices, something many don’t want to do after living a secluded lifestyle for more than two years. Office apps and associated data tools are designed to help overcome this resistance by making the workplace more fun, efficient and safer.
The size of the office software business is difficult to estimate, in part because it is so young, but participants estimate it to run into the billions of dollars.
WeWork’s rollout of its workplace software service marks the latest chapter in the company’s saga. WeWork shook the office space industry in the years leading up to the pandemic, but a planned IPO in 2019 flopped spectacularly.
Since then, a new management team has cut costs by shedding numerous leases. Last October, WeWork went public through a merger with a special acquisition company.
But the company’s stock, which peaked at $13.18 in October, has fallen below $5 a share, in part because the company continues to operate at a loss and is still at stake for $2 in debt. .4 billion, to be paid in 2025, analysts say.
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Some analysts don’t expect WeWork’s new workplace software offerings to help much.
“It seems to be mostly a diversion away from what is a bad business model,” said David Trainer, chief executive of investment research firm New Constructs.
But Alexander Goldfarb, Piper Sandler’s senior real estate investment trust analyst, predicted that boosting building occupancy rates with new ventures like WeWork Workplace and reducing cost margins will put WeWork on track to achieve positive cash flow by 2024.
“WeWork is a great outfit for companies looking for flexibility and small businesses, especially if you’re trying to figure out what your office needs,” said Mr. Goldfarb.
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