WeWork Cos., the real estate company, has unexpectedly received a blow when Softbank reduced its investment to $2 billion, from earlier $20 billion. The shared-office-space provider company has become renowned in the real estate sector in a short span.
Besides the current investment, Softbank has also endowed $ 4 billion earlier, which together sums up the investment to be $10 billion. The decision to decrement the investment was undertaken by Softbank Vision Fund, owing to the lopsided business stability of WeWork Cos. The decision-makers (investors of The Vision Fund) viewed the profitability as a precursor to sanction investment to WeWork Cos. and consequently, drastically reduced the amount to $2 billion.
In an interview to WSJ, investors which are backing Softbanks Vision Fund said, They have told SoftBank executives they would prefer the fund stick to technology bets. This seemingly hints that WeWork Cos. is out of the lot and is not considered a tech bet. (Source-Bloomberg)
Soon after the investment, WeWork Cos. altered its name as The We Company which is believed to be a well-planned marketing strategy. Fast Company, which first covered the rebranding news informed, The rebranding appears to be largely contained to marketing at this point. The company is sticking with its main service offerings. But it signals bigger changes down the road, as it eyes entrance into every facet of urban living. (Source CNBC)