Less than two weeks ago, WeWork took the wraps off a new massive round of funding — $500 million from the Chinese private equity firm Hony Capital, the Japanese internet giant SoftBank, Greenland Holdings, and China Oceanwide.
Now, the company is announcing that it’s pouring that exact amount — $500 million — into expanding into Southeast Asia and Korea. Interestingly, it says this $500 million is new and not the same capital, though it isn’t disclosing from where the money is coming.
As part of its announcement, WeWork says it has spent an undisclosed amount to acquire a 1.5-year-old, Singapore-based co-working company Spacemob. Spacemob’s founder and CEO, Turochas Fuad, will become managing director of Southeast Asia for WeWork. Spacemob’s roughly 20 employees will also join WeWork.
SpaceMob had raised just $5.5 million in seed funding from Alpha JWC Ventures and Vertex Ventures in November of last year. Rather than a big, splashy acquisition, it more or less represents the same, promising but smaller scale business that WeWork has acquired in the past.
WeWork’s few previous acquisitions to date include Fieldlens, a mobile communication system for the construction industry that WeWork bought in June; Welkio, a digital sign-in system for guests at an office that it purchased last year; and Case, a building information modeling and consultancy firm that WeWork acquired in 2015. WeWork hasn’t disclosed financial terms for any of these deals.
The amount of money that WeWork has raised this year is astonishing. In addition to the $1 billion it has announced in the last two weeks, a Delaware filing had surfaced in June, showing that WeWork had closed on $760 million in separate funding. WeWork also raised $300 million in March.
The company was reportedly valued at $20 billion as of two weeks ago. It isn’t clear whether its newest capital injection changes that number.
Given the fractured but growing competition that WeWork is facing in these newer markets, its aggressive push isn’t surprising. Just last month, URWork, a two-year-old, Beijing-based co-working business in China modeled largely WeWork, raised $30 million in fresh funding that brings its total funding to date to $175 million altogether.
It’s also in a race with Naked Hub, a company that started out in resorts and has moved into co-working across China to become a key rival. Naked Hub recently moved into Southeast Asia with an acquisition of its own, and it is raising $200 million for growth.
WeWork already has locations in Beijing, Shanghai, Hong Kong, Seoul, and Bangalore. Zeroing in on Singapore also makes sense given the sky-high rates that startups must pay for offices, which rank among the highest in the world.
The company’s newest $500 million round is just the latest of three significant rounds it has raised so far in 2017. In June, a Delaware filing surfaced that showed WeWork had closed on $760 million in new funding in June. WeWork had also raised $300 million in March. The company is now valued at $20 billion.
In addition to SoftBank, Hony Capital, Greenland Holdings, and China Oceanwide, WeWork’s investors include Benchmark, Aleph, Fidelity Investments, Goldman Sachs, JP Morgan Chase, Legend Holdings, T. Rowe Price, and Wellington Management, among others.
(Correction: We’d originally reported that WeWork’s newest $500 million in funding from undisclosed sources was the same $500 million that it reported two weeks ago. Apologies for the confusion!)