NEW YORK, NY, WeWork, a co-working space operator, has raised $260 million in additional Series F funding.
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WeWork has raised $260 million in additional Series F funding from new investor Shanghai Jin Jiang International Hotels, according to the Wall Street Journal. The news comes just seven months after the company raised up to $430 million from Chinese investors, with the option to sell stock up to $780 million. Now, with Jin Jiang on board, WeWork is better positioned to expand into Asia.
The company now operates 98 co-working spaces in 32 cities and has even launched a plan to include 'coliving' as part of its offerings.
Despite its big plans and successes (opening up locations in Shanghai and South Korea), the Adam Neumann-led company has a long list of challenges and critics.
Over the past several months, the company has also been called out by former employees over the legality of its handbook, which is in the midst of being updated after some of the provisions were flagged by the National Labor Relations Board as unlawful.
It also faces at least one other labor board case brought forward by former employee Tara Zoumer, who told the New York Business Journal that she was fired after refusing to sign an arbitration agreement with the company.
Lastly, there are those observers who have noted that the company is grossly overvalued.
'I honestly think it's a bubble,' David Alberto, a veteran of the short-term office rentals sector, told the WSJ earlier this year, citing how WeWork leases all of its locations and doesn't actually own real estate.
The structure of WeWork's leases provides a 'shield' for the parent company in case there are failures at individual locations. WeWork typically uses single-purpose entities, registered as limited liability corporations, to sign its leases with landlords. If one of its locations does poorly, the landlord has to deal with it, rather than WeWork (the parent company).