Today, WeWork Executive Chairman Marcelo Claure presented employees with a go-forward strategy, defining the key priorities and acknowledging the past, as the company moves forward with its next chapter.
Successful execution of the strategy is expected to strengthen the member experience, enable the company to achieve profitability on an adjusted EBITDA* basis, and generate positive free cash flow.
Claure reiterated:
- WeWork’s position as the world’s leading co-working and space-as-a-service platform;
- Its mission to reinvent the way people work through designed space, flexibility, technology, and community;
- The significant potential of the company with:
- The opportunity to leverage our first-mover advantage in co-working/space-as-a service;
- A physical global platform that captures users spending 8-10 hours at least five days a week in our buildings, providing opportunities to make their experience with us more meaningful; and
- The strategic advantage of workspaces where people feel energized, more productive, and more fulfilled compared to a traditional office experience.
- The opportunity to leverage our first-mover advantage in co-working/space-as-a service;
The strategy outlined six pillars:
- Deliver an amazing member and employee experience.
WeWork will prioritize and invest in the member experience to deliver a consistent, seamless global offering. For employees, initiatives are being designed to foster an even more collaborative, creative, and productive work environment.
- Earn the right to be the partner of choice
WeWork will demonstrate its value proposition to all of its partners across the entire ecosystem—small, medium-size, and larger enterprises and startups; landlords; and brokers.
- Execute the core business brilliantly, building by building:
Rigorous execution, a better member experience, and dynamic pricing should drive and accelerate profitability across our portfolio of buildings. Current building economics in key locations coupled with a disciplined cost approach demonstrate the company’s ability to operate profitably over time.
- Grow and expand geographically in a smart and profitable way
WeWork will continue to grow through localized, market-driven models that, in addition to the current end-to-end solution, will include asset-light strategies such as management agreements, JVs, and franchising.
- Create and sell valuable new products and services and monetize spaces
WeWork will move to better monetize its current spaces through new access and pricing models for members and non-members. WeWork’s platform also positions it well to provide members with products and services they want by creating and partnering with top providers to offer value-added services.
- Operate with an ownership mentality
The company will continue to focus on costs and performance management. A dedicated Transformation Office will look across all functions to implement both revenue-generating and cost-saving opportunities.
To create and reward high performance, WeWork will roll out a new compensation model. Transitioning from an old model too reliant on equity, the superior incentive structure includes a competitive base salary, an annual cash bonus, and long-term incentives. The company will also provide all employees, as well as those who recently left us as part of the restructuring, with the opportunity to participate in an exchange offer that allows for the repricing of options at our new fair market value.
WeWork also announced the promotion of Matthew Jahansouz as Chief People Officer and the addition of proven CEO-caliber leadership, appointing Maurice Lévy as interim Chief Marketing Officer and interim Chief Communications Officer overseeing marketing and communications, and Ralf Wenzel as Chief of Product & Experience Officer.
*We define “adjusted EBITDA” as net loss before income tax (benefit) provision, interest and other (income) expense, depreciation and amortization expense, stock-based compensation expense, expense related to stock-based payments for services rendered by consultants, income or expense relating to the changes in fair value of assets and liabilities remeasured to fair value on a recurring basis, expense related to costs associated with mergers, acquisitions, divestitures and capital raising activities, legal, tax and regulatory reserves or settlements, significant non-ordinary course asset impairment charges and, to the extent applicable, any impact of discontinued operations, restructuring charges, and other gains and losses on operating assets.
