China’s largest co-working company, Ucommune, has filed plans for an initial public offering on the New York Stock Exchange.
The offering could take place as early as next month, the Wall Street Journal reported. It will represent a test of investor sentiment following WeWork’s IPO debacle this fall — was WeWork’s failure a symptom of problems specific to the company, or is the co-working business model as a whole now in question?
“The fact that they’re doing it so soon after WeWork is surprising,” Jonathan Wright, director of flexible workspace consulting for Asia at Colliers International, told the Journal.
Ucommune’s SEC filing indicates that the company is targeting a $100 million raise, though that may represent a placeholder before a final amount is set. The deal will be underwritten by two Chinese banks, China Renaissance and Haitong International, after Credit Suisse and Citigroup dropped out last week amid a dispute over the company’s valuation.
The company was valued at $2.6 billion in its most recent funding round in 2018, and has been backed by the likes of U.S. venture-capital firm Sequoia Capital.
The Beijing-based firm, which had 171 co-working spaces and 72,700 workstations at the end of September, was founded in 2015 by Mao Daqing, a former executive at China Vanke, the country’s largest real estate developer by market capitalization.
The company’s lone overseas location is located at Fosun International’s 28 Liberty Street in Lower Manhattan, where local partner Serendipity Labs is managing the space.
Ucommune has been operating at a loss as new locations take time to become profitable, but its loss as a share of revenue pales in comparison to what WeWork disclosed in its IPO filing. Ucommune changed its name from UrWork two years ago after facing a trademark lawsuit from the Softbank-backed WeWork.