WeWork is seeing a growing amount of revenue from SoftBank, which is also its biggest investor.
SoftBank accounted for 2% of WeWork’s revenue in the first six months of this year, up from nearly 0% in 2017.
WeWork has drawn criticism for its extensive series of deals involving so-called related parties — employees, executives, investors, and their family members.
For a number of factors — including these types of transactions — the company has been struggling to pull in investors for its planned initial public offering.
Read all of Business Insider’s WeWork coverage here.
SoftBank, which is WeWork’s biggest backer, has also become an increasingly important customer of the commercial real-estate company.
The Japanese conglomerate accounted for 2% of WeWork’s revenue in the first 6 months of this year, according to documents the latter filed in preparation for its planned public offering. That portion was up from just 1% for all of last year and nearly 0% in 2017.
The company also counts Rhône Group, another one of its investors, as a customer. But Rhône accounted for a much smaller portion of WeWork’s revenue.
“We have entered into membership agreements and/or other agreements relating to the provision of Powered by We solutions with SoftBank entities and affiliates of the Rhône Group,” WeWork said in its IPO paperwork. “We believe that all such arrangements have been entered into in the ordinary course of business and have been conducted on an arm’s-length basis.”
WeWork’s Powered by We service involves building out and managing office space that other companies own or have leased.
SoftBank declined to comment. Representatives of WeWork did not respond to an email seeking comment. Rhône Group did not immediately respond to an email seeking comment.
WeWork is seeing more revenue from SoftBank
In the first six months of this year, SoftBank paid WeWork $28.2 …read more
Source:: Business Insider