Coworking platform company WeWork raises $355M on $5B valuation

WeWork has had phenomenal growth, reaching a $150 million annual run rate, according to reports. In New York City alone it has leased 1.6 million square feet of office space, making it the fastest-expanding company on a square-footage basis.

This latest round was led by T. Rowe Price, clients of Wellington Management, and Goldman Sachs Group, according to the company. Investors from prior rounds also joined the round, including J.P. Morgan Chase & Co., Harvard Management Co. and Benchmark.

The investors are not focused on the specific real estate that the company is leasing — although the firm looks for offices in popular parts of the cities where it operates — but the possibility of the company establishing itself as a platform for coworking between the users.

I wrote about WeWork recently, when the company announced WeWork Commons, which is a pay-as-you-go plan for more casual coworkers. It’s a good plan for someone like me, since I generally work from home, but occasionally find myself in NYC or other major cities and needing a place for meetings or just to work while there. The Commons plan also allows members access to the company’s benefits programs, like insurance, and gym membership discounts.

The company also has a software product strategy, a social network for members. Here’s a screenshot. I described the features at some length in the recent post.

WeWork is clearly more than the sum of its parts, and the community that the app engenders is part of the charm of being a member of WeWork, and why the firm can charge a premium of $400 per month for a desk in the company’s Financial District headquarters.

The company apparently is planning an IPO in the next few years. The way it’s growing, it’s likely to be above $10 billion at that point.