WeWork: Welcoming WeExplore3 WeExplore mission statement: To create world where people work to travel, not travel to work. We recommend that WeWork leverages its deeply rooted mission,

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WeWork: Welcoming WeExploreDeGroote Consulting, Product Strategy Division

Sarah SchweinbergerBriana KnowltonMichael WidlickiShelby Gorelle

Opportunity Statement

2

Given WeWork mission, culture, assets and strategic advantages, in what ways should the organization extend its product offering, specifically in the context of its DNA as a mission-driven company?

Recommended Solution

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WeExplore mission statement: To create world where people work to travel, not travel to work.

We recommend that WeWork leverages its deeply rooted mission, culture and strategic advantages to create a new product offering, WeExplore, for its target

millennial consumer base.

Key Considerations

4

Key Considerations

5Key Issues Analysis Alternatives Solution Execution Contingency

Product Synergies

Competitive Advantage

Market Opportunity

Mission and Vision

Key Considerations


• Recommendations must complement, not cannibalize, WeWork existing product portfolio

• Successful synergy will allow WeWork to tap market shares of its other community initiatives

Key Considerations


• Among WeWork core competencies include real estate and software development

• Business opportunities aligning with these core competencies require less upfront investment

• Level of competition within markets must also be identified

Key Considerations


• Market size and speed of penetration must be understood and strongly considered when proposing a new product for WeWork

Key Considerations


• The WeWork mission and its focus on community is truly the organization’s core

• Recommendations must align well with these values

• The mission and the business are linked (as the mission grows, so does the bottom line)

Key Considerations


Key Takeaway: The identify of WeWork as an organization is essential; it must not be compromised when looking to expand the firm’s product offerings.

Analysis

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Strategy Mix Analysis


Global Analysis

Industry Analysis

Firm Analysis

Target Market



Global Analysis

Industry Analysis

Firm Analysis

Target Market

United States• Pop’n: 316M• Individualistic• WeWork in 19 major

cities



Global Analysis

Industry Analysis

Firm Analysis

Target Market


cities

Canada• Pop’n: 36M• Individualistic• WeWork in 1 major city



Global Analysis

Industry Analysis

Firm Analysis

Target Market


cities


China• Pop’n: 1.3B• Collectivist• WeWork in 2 major city



Global Analysis

Industry Analysis

Firm Analysis

Target Market


cities


China• Pop’n: 1.3B• Collectivist• WeWork in 2 major city

Europe• WeWork in 3 major

countries (UK, France, Germany)

• UK pop’n: 41M• France pop’n: 60M• Germany pop’n: 80M• Individualistic



Global Analysis

Industry Analysis

Firm Analysis

Target Market


cities


China• Pop’n: 1.3B• Collectivist• WeWork in 2 major

cities




Mexico• Pop’n: 120M• Collectivist• WeWork in 1 major city



Global Analysis

Industry Analysis

Firm Analysis

Target Market


cities



cities





India• Pop’n: 1.25B• Collectivist• Coming soon!



Global Analysis

Industry Analysis

Firm Analysis

Target Market


cities



cities





India• Pop’n: 1.25B• Collectivist• Coming soon!

Key Takeaway: WeWork has proven that it can establish itself globally; it can leverage these connections to expand its business in these regions.



Global Analysis

Industry Analysis

Firm Analysis

Target Market

Industry Rivalry

Buyer Power

Threat of Substitutes

Supplier Power

Threat of New

Entrants

Porter’s Five Forces Analysis: The Sharing Industry



Industry Rivalry

Buyer Power


Supplier Power

Threat of New

Entrants


Threat Level: High• Many substitutes available• Sharing option must be

perceived as a value add



Industry Rivalry

Buyer Power


Supplier Power

Threat of New

Entrants


Threat Level: High• Sharing companies do not

own their tangible assets, the asset owner has high power in what they will or will not allow

• Suppliers have power to set price



Industry Rivalry

Buyer Power


Supplier Power

Threat of New

Entrants


Threat Level: Medium• Sharing is trendy; firms want

to move into this trendy space

• First mover advantage is important

• High start up costs create barriers to entry



Industry Rivalry

Buyer Power


Supplier Power

Threat of New

Entrants


Threat Level: Medium• Abundance of traditional

options (hotels, taxis, single homes, workspaces, etc.)

• People are looking for sharing options however, because it adds value (cheaper, less accurate in personnel projections)



Industry Rivalry

Buyer Power


Supplier Power

Threat of New

Entrants


Threat Level: High• First movers become the

preferred choice; it is difficult to take away their customers

• There are a few large players owning the market share

• Accessible on a small scale




Industry Rivalry

Buyer Power


Supplier Power

Threat of New

Entrants

Key Takeaway: The Sharing Industry is trendy but competitive; first mover’s advantage, paired with creativity, is crucial.



Global Analysis

Industry Analysis

Firm Analysis

Target Market

Strengths• Deeply rooted culture and value set• Focus on community; resonates with target

market• Mission driven employees with

complementary skillsets• Modern design, appealing space• Empowering environment• Strong valuation and investor support• Well established foundation that can be

translated into different business opportunities



Global Analysis

Industry Analysis

Firm Analysis

Target Market

Weaknesses• Viewed by critics as pricy• Room for improvement with brand

awareness, particularly in smaller cities• Dependent on real estate industry and

overall employment rate of host countries



Global Analysis

Industry Analysis

Firm Analysis

Target Market

Key Takeaway: With its deeply rooted philosophy and focus on community, WeWork is a established a strong foundation which it can leverage when exploring new business opportunities.



Global Analysis

Industry Analysis

Firm Analysis

Target Market

Who is your target market? Introducing Pat the Millennial.

Who is Pat?



Global Analysis

Industry Analysis

Firm Analysis

Target Market


Who is Pat?

• Age: 28 years• Gender: Male or Female• Values community, exploration and travelling• Wants to feel that he or she has a “purpose”• Work to live mentality, but has a passion for their job• Feels that the work they’re doing is meaningful• Travelling and working is an appealing combination,

not tied to a specific location• Comfortable with new situations/ambiguity



Global Analysis

Industry Analysis

Firm Analysis

Target Market


Who is Pat?

• Age: 28 years• Gender: Male or Female• Values community, exploration and travelling• Wants to feel that he or she has a “purpose”• Work to live mentality, but has a passion for their job• Feels that the work they’re doing is meaningful• Travelling and working is an appealing combination,

not tied to a specific location• Comfortable with new situations/ambiguity

Key Takeaway: Pat’s needs must be considered when developing a recommendation.

Financial Analysis of Boston WeWork


AssumptionsAverage of Dedicated desk and Private Office 400Number of Available Desks 20,000Average WeLive Pricing (murphy/4 bdrm.) 2,375

Financial Analysis of Boston WeWork


Key Takeaway: WeWork currently has a large customer base that can be used to cross-sell complementary products to create value for both WeWork and the member

Alternatives

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Alternatives


WeMove – Ride sharing for vehicles bikes and car sharing

Key Takeaway: WeMove has a large customer base and technological competencies, but vehicle management and legal/Government learning curve would be capital intensive

• Attractive in current locations

• Millennials are trending towards not wanting to own vehicles

• Doesn’t align well with competencies ( no vehicle experience)

• Insurance complications (experienced by Uber)

• Legal and public retaliation

Alternatives


WeExplore – Shared Travel Space

Key Takeaway: Plan directly leverages competencies in both Real Estate and Technology, greater competencies will have to be developed in Foreign Markets

• Hostels are popular with millennials already

• WeWork has the competencies and assets (real estate & tech)

• Channel to foster community

• Experience resistance from landlords if community is disruptive

• Plan is heavily reliant on successful staffing

• Greater competencies will have to be developed in “travel” locations

Alternatives


WeConnect – Bolster the app with: Marketplace, Social Network, and Job Board

Key Takeaway: WeConnect allows for the quickest roll out directly address the member community need to communicate. Unfortunately the offerings may be redundant in regards to existing solutions

• Quick rollout• Current Application base

already exists• Will directly address

members large engagement in the online community

• Social media space is rather crowded

• Not a directly revenue generating proposal

• Customer base may feel the offerings are redundant in comparison to existing solutions

Decision Matrix


Key Considerations Weight WeMove WeExplore WeConnect

Mission and Vision 0.30 3 5 3

Market Opportunity 0.25 5 5 3

Competitive Advantage 0.25 1 3 3

Product Synergies 0.20 1 5 3

TOTAL 1.0 2.6 4.5 3

1 – does not address5 – fully addresses






Implementation Plan

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Implementation Overview


WeWork mission statement: To create a world where people work to make a life, not just a living.

Implementation Overview


WeWork mission statement: To create a world where people work to make a life, not just a living.


What is WeExplore?


• Another way for members to leverage their WeWork and/or WeLivemembership and recognize even more value

• An opportunity for members to experience new cultures and countries within the WeWork network

• A flexible plan that allows members to (a) work while they travel or (b) leave their work at home

How Does WeExplore Work?


Pat is a hard worker, and decides that he deserves a break. He is already a member of WeWork and loves the service – and he’d love to take it with him when he leaves.




Pat learns about WeExplore from his office mate, Jennifer. Curious he downloads the WeExplore app.




Pat learns about WeExplore from his office mate, Jennifer. Curious he downloads the WeExplore app.

Pat sees a list of destinations, include major global cities such as New York, Shanghai and Berlin. Pat has never been to Berlin, so decides its worth exploring.



Berlin? Great choice!

When would you like to visit?

Date

Time

Ben selects his date and time.





Pat selects his date and time.

Pat then selects a travel plan that best suits his needs.

01/01/17

11:00am EST

The Travel Plans


Visit

• Lowest price point• Dorm style

accommodation • Bunkbeds, shared

restroom• Shared kitchen unit

The Travel Plans


Visit



restroom• Shared kitchen unit• Shared local

“WeWork” member guide

Experience

• Medium price point• Semi-private rooms (2

people) with double beds

• Shared kitchen unit and restrooms

• Shared local “WeWork” member guide

The Travel Plans


Visit



restroom• Shared kitchen unit• Shared local

BackPack buddy

Experience

• Medium price point• Semi-private rooms (2

people) with double beds

• Shared kitchen unit and restrooms

• Shared local BackPack buddy

Immerse

• Highest price point• Suite-style

accommodation• Shared kitchenette

and common area• Personal washroom• Shared local

BackPack buddy





Date

Time


Pat then selects a travel plan that best suits his needs – he has determined that the “Immerse” plan offers him the best value.

Immerse Plan

$X,XXX.XX





01/01/17

11:00am EST


Pat then selects a travel plan that best suits his needs – he has determined that the “Immerse” plan offers him the best value. Immerse Plan

Location ALocation BLocation C

Please select a location.

Finally, Pat is prompted to select a location that best suits his needs – the location will include both accommodations, as well as the closest WeWork office building.



Once details have been finalized, final payment will be prompted, and Pat will be able to finalize the details of his trip.

When Pat arrives in Berlin, he will be welcomed by a local WeWork employee, otherwise known as a “BackPack” buddy, to help him feel settled, and get to know members residing in his accommodations.

The BackPack buddy will then provide him with a list of potential tours that he may take advantage of, as well as fun excursions, allowing Pat to immerse himself into the culture of his host country.

Timeline


0 months

1 month

2 month

3 month

4 month

5 month

6 month

7 month

8 month

Gather – scout locations

Recruit – find WeExplore staff

Understand - Train new staff

Organize – Design WeExplore space

Promote – utilizing existing apps and social media

*leases are signed

Assumption: assumes negotiations are immediate

Cost and Breakeven


Visit Experience ImmerseRoom Price 55 75 95Revenue 30days 1650 2250 2850Cost (Lease Buidling Own 40% 660 900 1140Operating Income 60% 990 1350 1710

10% of Desks 2000 667 667 667

Operating Income 660,000 900,000 1,140,000

Upfront Cost to Building Owner 21,600,000 Full Year Lease Cost

Occupancy 100% 32,400,00090% 29,160,00080% 25,920,00070% 22,680,00060% 19,440,000

Contingencies and Risks

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Contingencies and Risks


Situation Trigger Likelihood Solution

Unable to recruit adequate and skilled WeExploreStaff

Guests complaining about poor experiences or unenthused guides

Low Double down on social media promoand recruitment resources

Travelers are price sensitive and feel that prices are too high

Low traction and customer complaints about price

Low Reinforce added value and package services that WeWork provides

WeExplore fails to expand outside of current member base

Use of WeExploreservices coming only from existing members

Medium Look in to acquiring well known hostels for shared resources and knowledges


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Value Met? ExplanationInspire Gives members the opportunity to

experience the world in other culturesEntrepreneurial Learn from other cultures, tours that

involve industry knowledge from that areaAuthentic Staff are locals who know the cultureTenacious Expand ambitiously Grateful Tours that do social goodTogether Community building through shared

accommodation

Appendix

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KPIs

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• # of reservations made• Proportion using multiple products

(WeWork, WeLive, and WeExplore)• Traveller satisfaction• Portion booking each plan (are we

adding enough value with more expensive plans

• Marketing measure

WeWork: Welcoming WeExplore3 WeExplore mission statement: To create world where people work to travel, not travel to work. We recommend that WeWork leverages its deeply rooted mission,

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