The Rise and Fall of the WeWork Brand

Brand over business? When WeWork filed for bankruptcy last week with a valuation hovering around $44 million, down from a wildly overinflated valuation of $47 billion in 2019, I was not surprised. The company had been circling the drain well before COVID turned the world upside down and drove employees out of the offices and into their homes. As the CEO of a branding firm, I loved the brand. As a former tenant, all the flaws in the business execution of that brand were frightening.

I had a front row seat to the rapid expansion and depressing fall of WeWork. Prior to starting my own agency, I had spent a few years working in a WeWork space in New York when I was splitting my time between my clients in Boston and NYC. In fact, it was my experience in that small but exciting New York City WeWork that was a contributing factor in my decision to go on my own. It was the ideal environment for a PR start-up: brimming with activity, filled with like-minded entrepreneurs and providing an endless stream of potential clients through WeWork’s internal social media platform which connected tenants to every other business operating out of every other WeWork in the world.  

So when I started Gaslight in the waning days of 2016, I set up shop in a WeWork in the Fort Point area of Boston. Beers were on tap, WeWork employees were helpful and energetic, every office was filled, and the clients started coming through the doors in droves. Within six months, we had a second location in another WeWork on Lexington Ave. in NYC. Business was booming, and our decision to operate out of WeWork played a significant role in our growth and success.  

However, over the next few years, you could see the cracks begin to form. The staff turnover rate was lightning fast, with employees transferring to help open new WeWorks in other cities before you got a chance to remember their names. The cool entertainment room with its pool table, bar, old school video games and big screen TVs that everyone gathered around to watch Red Sox day games got anesthetized overnight and suddenly felt like a nondescript breakroom at any paper company in Scranton, PA. The beers and wine on tap got replaced with Kombucha which elicited a collective sigh from every tenant in every WeWork office across the country. Then just months before COVID became the word of the year, we watched the company’s disastrous attempt to go public and learned of the seemingly unstable behavior of founder Adam Neumann and WeWork’s significant financial problems. Of course, this ultimately led to Neumann stepping down as CEO, but not before thousands of WeWork employees were laid off and Neumann was given a golden parachute worth hundreds of millions of dollars. Yay capitalism!

Since those early years, and in an attempt to return to our pre-Covid sense of normally, Gaslight has reopened our offices in Boston and NYC and ventured out West with a shiny, new space alongside a partner video production company in LA. We have expanded our offerings beyond PR into creative services and branding, and I’m happy to say that business continues to boom, but we are doing so without the boost that our former landlord once provided. None of our offices are located in a WeWork. The once abundant benefits of being in their ecosystem no longer exist, or if they do, I was unable to find or identify them.  

Following the news of WeWork’s fall from grace, Sarah Travers, the CEO of WeWork competitor Workbar issued a statement touting their strong market position and prudent growth and financial decisions over the last decade, standing in stark contrast to the WeWork “growth at all costs” approach. 

However, there was one part of her statement that stood out to me. During her reminiscing of her time at Regus (another shared office space company) in the early 2010s, she compares that company to the young WeWork. She wrote, “The real struggle for Regus was not the product - it was formidable - it was about branding and market recognition. Then WeWork emerged, becoming the emblem of the trendy, modern workspace, with endorsements from the likes of Ashton Kutcher bolstering its image. Regus had a commendable product, but WeWork had crafted the coveted brand identity.” 

As the leader of an agency that has branded hospitality properties throughout the US in highly competitive markets, I understand the power that a strong brand identity can have on market position and dominance. You can have the best product, but if you don’t have a brand that conveys the strength of that product, establishes you as an innovator, and differentiates you from your competitors to your target audiences, you will likely get lost in the noise. WeWork had it. And lost it. Because while it crafted a brand identity, it didn’t focus on the little things, like asking are we profitable and can we afford to buy or lease billions of dollars worth of commercial space virtually overnight"? Apparently, for long-term success, financial viability and a strategic growth plan are also kinda important. Who knew?