WeWork’s China subsidiary gets a US$500 million Series B funding led by Trustbridge Partners to expand its business in China, which will see its valuation jump five times to US$5 billion.
Slightly over a year earlier, the co-working giant’s subsidiary in China, called WeWork China, had secured US$500 million to start its business in the country which saw it valued at US$1 billion.
The latest funding round also includes Softbank Group, Softbank Vision Fund, Hony Capital and Temasek, the company said in a press statement on Friday.
Parent WeWork, one of the pioneers in the co-working space sector, had acquired Shanghai-headquartered Naked Hub in April this year, the sixth acquisitions in eight months then.
WeWork’s co-founder and CEO, Adam Neumann, said in the press statement that the “investment (is) to support creators, small businesses, and large companies across China”
But Financial Times also said Friday that WeWork is intending to expand its real estate portfolio within three large Chinese cities and open co-working spaces in Guangzhou and Shenzhen, according to anonymous sources.
While the Softbank-backed WeWork is raising funds at a US$35 billion valuation that will put it above Airbnb and SpaceX, doubts have raised over its finances when it went to the corporate debt market in April as it had to reveal its balance sheet for the first time.
Its expenses of US$1.8 billion far exceeds its revenue of US$822 million in 2017 according to a report in April by Bloomberg. Its losses are expected to exceed US$1 billion per year, according to an analysis by the Financial Times, which puts its valuation closer to US$3 billion than the more than ten-fold figure proposed by Softbank and WeWork.
In Southeast Asia, regional players in the co-working sector have also been attracting funding recently. Indonesia’s EV Hive raised US$20 million in June this year, and Singapore-based JustCo partnered with Singapore’s sovereign fund GIC and property developer Frasers Properties in a US$177 million deal a month earlier.
