Telecommunications firm SoftBank and the $93bn Vision Fund which it manages agreed yesterday to invest a total of $4.4bn in US-based working space operator WeWork.
The two will pay $3bn to acquire a mixture of primary and secondary shares, and will provide $1.4bn in funding for three new regional WeWork subsidiaries in Asia. WeWork has not disclosed which investors sold shares through the deal.
Founded in 2010, WeWork oversees a network of 160 co-working spaces, stretching across 50 cities in 16 countries. Customers can rent desks or full offices and have access to rapid-speed internet, office supplies and equipment, and other perks such as free coffee.
The company plans to move heavily into Asia through the new subsidiaries – WeWork China, WeWork Japan and WeWork Pacific, which will focus on Southeast Asia and Korea – and all three will be managed by local teams.
SoftBank and private equity firm Hony Capital invested $500m in WeWork China last month, though it is unclear whether the former’s share of the funding will be rolled up into the $1.4m investment.
SoftBank vice-chairman Ronald D. Fisher and Mark Schwartz, a senior director of investment banking firm Goldman Sachs who, like Fisher, sits on SoftBank Group’s board, will take board seats at WeWork as part of the deal.
WeWork had previously raised $2.45bn in funding, not including the $500m WeWork China deal. SoftBank invested $300m in the company at a reported $17bn valuation in March this year, stating that it, along with Vision Fund, was considering supplying another $2.7bn for the company.
The SoftBank investment was followed by a $760m series G round closed by WeWork last month, though it did not disclose the participants in the round, which valued it at $20bn.
Hotel chain Shanghai Jin Jiang International Hotels and conglomerate Legend Holdings were among the investors in WeWork’s $690m series F round, which closed in October 2016 with backing from Hony Capital and an undisclosed US-based family office.
Masayoshi Son, chairman and chief executive of SoftBank, said: “WeWork is leveraging the latest technologies and its own proprietary data systems to radically transform the way people work.
“[WeWork co-founder and CEO Adam Neumann]’s unique vision and talented team have created a sharing platform that offers maximum flexibility and opportunity to creators of all types, from young entrepreneurs to large multinational companies.
“We are thrilled to support WeWork as they expand across markets and geographies and unleash a new wave of productivity around the world.”
WeWork’s earlier investors include financial services providers Fidelity Management and Research, JP Morgan Investment Management, and Goldman Sachs, investment firm T. Rowe Price, venture capital firm Benchmark and clients of Wellington Management Company.