We are starting to see the reason behind WeWork’s rebranding The We Company. They must have felt that they needed to grow past the identity of a “co-working” or “flex-office” company in order to appeal to industries outside of professional services. Now, armed with their new, righteous mission “to elevate the world’s consciousness” and a three-pronged business line of WeWork, WeLive and WeGrow they aim to use their ability to build communities for young, successful people to embed themselves into the fabric of the modern economy just as they have done in the tech start-up world.
Their latest announcement of a new Food Lab and food and beverage focused accelerator program falls right in line with that strategy. They have created a food-centric co-working space in Manhattan that will have amenities like an R&D kitchen, a photo studio and event space. It will also come with a connection to WeWork’s 400,000 membership base of potential customers, evangelists and partners.
The Food Lab will also feature a startup accelerator that will give space, guidance and funding to six to eight companies in each cohort. Changing food habits has long been a priority of the company. They made headlines, both good and bad, for their decision to ban employees from expensing meat for environmental reasons.
Even with the altruistic undertones of this program and the world-changing new brand image, there seems to be a strategic feel to how they are promoting what is basically a new property product. The company is said to have committed $1 million dollars to the accelerator but the details are unclear. This article says “around 10 startups will ultimately receive $1 million in equity investments. But this article (written by a publication that is partnering with WeWork on the Food Lab) says that the $1 million will be shared across all of the companies. The WeWork website didn’t help explain the situation with its wording that it will “seed $1 million in equity investments.”
Food startups are notoriously expensive to start. In 2017 the sector, the average investment was $10.9 million. That tells me that the Food Lab could help a young company in a lot of ways but will likely not be putting enough money in to be considered a serious investor. I am far from a WeWork hater, something that seems like an all too easy stance these days, and think that this is actually a smart move for the company. But I would expect that this will only be one example of many where WeWork will be trying to create property value around the entrepreneurial culture that it is so proficient at creating. Whether it is able to find lucrative investments with is accelerator program might be secondary to the goodwill that the effort will give them in the industry that they seem very interested to woo. If this model works we will likely see it replicated in other sectors that it thinks could grow fast enough to need professionally designed and managed flexible workspace.