The We Company, the parent company of coworking giant WeWork, filed paperwork with the U.S. Securities and Exchange Commission to announce an initial public offering. The company says in the filing it’s seeking a $1 million public offering, but that number is likely a placeholder and will be significantly higher.
The filings give the first inside look at The We Company’s financials and reveal the company lost $1.9 billion last year, while posting revenue of $1.8 billion.
For perspective, Uber said it lost $1.8 billion in 2018 and Lyft lost $911 million in 2018, according to CNN.
The We Company’s losses are likely exacerbated by the company’s fast growth. In the first half of 2019, the company has already posted $1.5 billion in revenue, nearly reaching last year’s level. It also posted a net loss of $904 million in the first half of the year.
In the filing, the company notes that the profitability of the business depends on how long locations have been open, and, as it scales rapidly, most of those locations aren’t yet in a state of stable cash-flow.
“The profitability profile of our business is a managed outcome driven by the maturity of our locations, or the length of time a location has been open to our members,” the filing says. “We define locations that have been open for more than 24 months as mature.”
“Once a location reaches maturity, occupancy is generally stable, our initial investment in build-out and sales and marketing to drive member acquisition is complete and the location typically generates a recurring stream of revenues, contribution margin and cash flow,” the filing continues.
That growth isn’t stopping any time soon, as the company is currently in 111 cities but targeting 280 for a total addressable population of 255 million consumers.