SoftBank has been in talks with WeWork for an investment of about 4 billion dollars. This investment could end up valuing WeWork at more than twenty billion dollars.
A report from CNBC explained that the Japanese giant of Telecommunication is thinking of making an initial investment of 2 billion dollars into the common workspace business WeWork and thinking of putting one billion dollars more into the firm. According to CNBC, the second installment of the investment could be increased to a total of two billion dollars too. This would put the total investment of SoftBank to an input of four billion dollars overall.
WeWork is just seven years old. In that time period, this company was able to raise a total sum of 1.4 billion dollars from their investors. This deal would bring their sum total to 5.4 billion dollars if it went right.
The investment mentioned in the report was confirmed by a source who is close to WeWork. They also confirmed that WeWork is in talks with SoftBank for a higher investment. Although, the source also mentioned that the Japanese had held a lot of earlier discussions with the view to participate in their 150 million dollar Series C round in 2013 and 355 million dollar series D round in 2014. The company was, however, not a part of those deals ultimately.
The deal isn’t yet final, but this time around it seems a little more portable. The source also added that there is still one issue that is holding things up. SoftBank’s Vision Fund is still trying to seek commitments from their investors, and in particular the prospective LPs in Middle East.
A valuation of 20 billion dollars would only bring the valuation slightly higher from their 17 billion dollar valuation, which was earned by WeWork in their Series F round where they raised 430 million dollars last March. The capital raise that took place last year was led by Legend Holdings and Hony Capital, the two most prominent Chinese VC firms. This raise was their first push into Asia and China. The firm was quick to announce their plans to open their first co-working spaces in Hong Kong and Shanghai. This announcement took place later that month.
WeWork also broadly mentioned that they are intending to be present in all major cities across Asia, but they didn’t give any specific expectations. This mega round of funding from SoftBank could be the required catalyst for WeWork to make those ambitions true and extend their West strong presence to the East.