WeWork spent years going after big businesses. Now, its new owner wants to look at the little guys.

  • Anant Yardi took a majority stake in WeWork through its bankruptcy process.

  • WeWork struggled post-2019 from pandemic constraints and long lease obligations.

  • Yardi plans to focus on small businesses and use hotel-like tech for real-time booking.

WeWork's new owner prefers to stay out of the spotlight — and he's already sketching out new plans for the embattled office company.

Anant Yardi, who, alongside his wife, founded the widely-used commercial real estate software Yardi Systems, took a majority stake in WeWork through its bankruptcy process. In total, he invested more than half a billion dollars in debt and equity. Japanese investor SoftBank and hedge fund King Street now own minority stakes.

WeWork catapulted to a household name on the heels of founder Adam Neumann's eccentric leadership and SoftBank's billions of dollars in investment, and fell from grace in 2019 for largely the same reasons. The company's ensuing turnaround was constrained by the pandemic and long lease obligations inked under Neumann, who failed to buy back the company out of bankruptcy.

Yardi, unlike Neumann, likes to build in the background and only recently started flying business class, the Financial Times reported on Thursday.

Yardi said he's planning to expand WeWork's marketing to focus on small businesses. That represents a major shift for the company, which has spent the last several years courting enterprise businesses, including under Neumann. Companies, especially in tech, prioritize bigger businesses in hopes that those customers will provide more stability and value than small startups and freelancers — WeWork's original customers.

But WeWork's enterprise business never fully realized its ambitions. Even back in 2019, the sales team missed targets, Business Insider reported at the time. WeWork pushed for enterprise sales hard in the wake of the pandemic, as companies rethought their office footprints.

In March 2021, WeWork had just over 200,000 enterprise customers — 52% of its customer base, excluding countries including China and Israel. By June 2023 — the latest time such data is publicly available — WeWork counted 240,000 enterprise memberships, 41% of the customer base.

WeWork will also look to use technology similar to the hotel industry, like real-time booking, and partner with other coworking companies, Yardi told the FT.

WeWork's balance sheet, now less constrained by leases, "looks very good," Yardi said.

"WeWork is such a popular and well-known brand, it didn't seem right to let it go down," Yardi told the FT. "I realize financial decisions are not made on right and wrong. But there's also a tremendous opportunity in terms of turning around WeWork."

At WeWork's peak in January 2019, SoftBank valued the company at $47 billion. Last month, WeWork advisers valued the company at about $750 million.

WeWork did not immediately respond to a request for comment, sent outside standard business hours.

Read the original article on Business Insider