WeWork Plans to Merge With a SPAC to Go Public

BowX Acq Corp Will Join With WeWork

Co-working space company WeWork has agreed to merge with a SPAC called BowX Acq Corp (BOWX) in order to go public. WeWork made plans to pursue a traditional IPO about two years ago, but these plans unraveled.

BowX raised $420 million as an empty shell last year and then began looking for a business to take public. Shares of the blank check company climbed on news that it will merge with WeWork.

WeWork’s Business Model

WeWork signs long-term leases with landlords. It then renovates and furnishes spaces and subleases offices and conference rooms to businesses and individuals. These subleases are sometimes as short as one month.

The pandemic created significant hardships for WeWork. Its clients were able to pull out of leases quickly when the world began working from home, but WeWork was left locked into long-term agreements with its landlords. WeWork’s occupancy rate around the world tumbled to 47% during 2020 and it lost $3.2 billion.

The Future of WeWork and Coworking

BowX values WeWork at $9 billion including debt. This is far lower than WeWork’s $47 billion valuation from 2019. The past two years have been tumultuous for WeWork because of its failed IPO and the pandemic.

However, some investors have high hopes for WeWork’s future and for the coworking industry as a whole. A number of companies will likely continue to offer remote work options even after the pandemic subsides. Meanwhile, some office workers have grown weary of working at home during the pandemic. WeWork may be able to provide a useful solution during a time of changing norms in the way workers and employers are thinking about the role of offices.

Things are changing daily within the financial world. Sign up for the SoFi Daily Newsletter to get the latest news updates in your inbox every weekday.

Sign up

Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Advisor
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.

All your finances.
All in one app.

SoFi QR code, Download now, scan this with your phone’s camera

All your finances.
All in one app.

App Store rating

SoFi iOS App, Download on the App Store SoFi Android App, Get it on Google Play

ABOUT SoFi SoFi helps people achieve financial independence to realize their ambitions. Our products for borrowing, saving, spending, investing, and protecting give our more than one million members fast access to tools to get their money right. SoFi membership comes with the key essentials for getting ahead, including career advisors and connection to a thriving community of like-minded, ambitious people. For more information, visit SoFi.com. Want an easy and convenient way to manage your financial life? Get the SoFi app. For iOS and Android.

TLS 1.2 Encrypted
Equal Housing Lender