Tuesday 13 November 2018 3:56 pm
Wework bags $3bn in additional funding from Softbank
Flexible workspace provider Wework has secured an additional $3bn (£2.3bn) in funding from Softbank, as it pushes ahead with its global expansion plans despite continuing to report losses across the board. The new funding builds on the $1bn that Wework received from the Japanese mega-investor in the form of a convertible bond earlier this year. Today's investment will be granted as a warrant, which will be split into two payments to be distributed in 2019. Wework's total global cash pile and cash commitments now sit at $6.4bn, having raised over $5.2bn this year to date.
The firm said it is seeing strong revenue growth with its third quarter having doubled year-on-year from $241.1m to $482.3m, and added it is now running ahead of its initial $2.3bn target for the end of the year.
While its rate of burning cash has also risen, Wework said this is "consistent" with its view on profitable growth. The move follows accounts published in October which showed that Wework tripled its losses in Europe last year, rising to £32.3m up from £11m the year before.
Wework added a record 53,000 desks to its portfolio over the last three months, and saw its occupancy rate reach 84 per cent despite having almost doubled its global capacity.
It has more than doubled its total locations worldwide to 335 sites in 24 countries since the same period in 2017, with over 50 per cent of its desks now residing outside of the US.
Last year Softbank invested $4.4bn into Wework as part of an equity funding round, valuing the tech firm at $20bn. It was reported in October to have been mulling a majority stake in the business.