WeWork, Upflex Form Global Partnership

WeWork is making a significant move with the formation of a partnership with Upflex, a New York City-based coworking aggregator and global flexible workplace startup with a global portfolio exceeding 4,800 third-party spaces. With the reciprocal access relationship, the companies will offer their members a network spanning more than 5,500 locations in 80 countries.

The deal is a potential boon for WeWork and its members, who will have access to new locations beyond WeWork’s current international footprint. At the close of the third quarter, that footprint consisted of 764 locations and 932,000 desks. WeWork will serve as an exclusive flex workspace operator, selling Upflex inventory to its members who will still only have to do business with a single provider.

The partnership will also allow the company to expand upgraded WeWork Access membership options, which provide members alternatives for searching, viewing and booking space at certain non-WeWork sites in the Upflex network.

For its part, Upflex will now hold the distinction of being the first third-party platform to have the exclusive right to book WeWork workspace.

Part of the plan

WeWork’s new partnership with Upflex dovetails with the company’s stated plans for moving forward in the pandemic era. “We will find asset-light ways to grow, either through management agreements or revenue share deals,” Sandeep Mathrani, CEO of WeWork Inc., said during the WeWork Investor Day 2021 presentation on Oct. 7, 2021. “We’re leaning into management agreements, revenue share to grow WeWork’s space-as-a-service product with limited upfront capital spend and landlord covered operating costs. As we expand our asset-light deals, we also expect our overall SG&A costs to decrease as a percentage of revenue and therefore increasing the margin of our overall business.”

The new partnership with Upflex extends beyond a reciprocal workspace arrangement for members. WeWork is investing in its partner and will participate in Series A funding for Upflex, which closed a $4.1 million seed round in 2019.

The Upflex deal follows another WeWork growth play this year—the acquisition of Dallas-based flexible workspace provider Common Desk. The purchase of the firm, which operates in Texas and North Carolina, is on track to close in March.