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WeWork leader confident in Chinese economy and market

en.people.cn | Updated: 2017-03-04 11:16

WeWork leader confident in Chinese economy and market

A WeWork office in Shanghai, Nov 17, 2016. [Photo/Xinhua]

The vast market for co-working spaces in China has welcomed a new, highly competent candidate in WeWork, a leading co-working space company from the US. WeWork is striding confidently into China, equipped with unique services and an ambition to serve more people.

WeWork was founded in New York City in 2010 by Adam Neumann and Miguel McKelvey, with the intention of creating a workspace centered on the idea of community. It now serves over 90,000 members in more than 120 locations across 30 cities and 12 countries. The company provides both working and living spaces, in addition to community services. China's capital city is just its latest stop.

Connecting China

In March 2016, the American company received an investment of over $400 million from Chinese investors led by Legend Holdings and Hony Capital – a move that was widely seen as the official starting point of WeWork's China strategy. Four months later, the first Chinese WeWork location was opened in Shanghai.

Less than a year later, the company is ready to open two new locations in Beijing, putting its total number of spaces in China at four. In addition, four more locations in Beijing and Shanghai are to be announced in 2017.

Nevertheless, McKelvey denied that the company's expansion into China was contingent on its multimillion-dollar investment.

"We were interested in China before we had investment from HONY capital. It was our plan to come here whether we had it or not … But obviously having them as a partner facilitates our entry. We still have our ability to follow our business plan," the WeWork co-founder and chief creative officer said in an exclusive interview with People's Daily Online.

While he stressed that WeWork remains independent from investors' influence, McKelvey did give credit to the Chinese investors for helping his team to understand the Chinese market and make business connections.

He said the investors have been helpful in the sense of "[knowing] someone who can give you feedback on decision-making and informal conversation about what's happening and how to navigate certain situations. When we have meetings with government officials, they've been there and taken part. That gives us a little credibility, to have a local partner."

Chinese investors also helped to assemble an investment round and facilitated WeWork's partnership with Sino-Ocean Group (SOG), which McKelvey called "a great partner." He also said the company is looking to expand the partnership and pursue additional partnerships with real estate groups in China.

Although WeWork gave no specific number for the company's 2017 expansion goals, McKelvey pointed out that the company expects to double in size in the new year, and "we see a lot of that growth coming in China."

"We approach the market in a very humble way, feeling that we know how to do it and we will work with people to learn as much as we can about the local market," he added.

Booming industry

The Chinese market is "very big and interesting" in terms of how quickly business evolves within it, but also in terms of entrepreneurship, McKelvey noted.

Business models are indeed changing rapidly, and co-working spaces are on the rise in China, especially as the nation calls for expanded entrepreneurship. In addition to early birds such as UrWork, Nashwork and SOHO 3Q, which were all built by real estate giants, China's major internet companies, including Alibaba and Tencent, are also reportedly considering an expansion into the co-working industry.

McKelvey declined to comment on those potential competitors in China. Rather, he said the market still has a lot of room for different companies to try to support the new way of working – more flexible, more interesting, more engaged and more connected to neighbors, friends and businesses.

"We believe that work is changing so quickly – what people want from their work life is changing much more quickly than any individual company could support. We think that as we grow, as other companies grow, they are inviting more businesses to think about the new way working space operates," he stated.

Unique offer

During the interview, McKelvey repeatedly expressed his confidence in the company's role in the Chinese market, despite the fact that several US companies such as Amazon and Uber encountered serious obstacles while competing with Chinese counterparts.

"We have great confidence in the China market and the future of China's economy. Certainly we are only touching a small part of business at this point. We believe there is so much room for us to grow, no matter how the market conditions are. So we have nothing but confidence. We believe we offer something unique in the market. We are super excited and we will continue to push forward with the same excitement and speed," McKelvey said, firmly pushing back against concerns over WeWork's future battles.

Over 50 percent of companies under the WeWork network engage in collaboration with other WeWork companies – a unique and valuable service that is an undeniable advantage compared to domestic Chinese brands.

It is almost routine for co-working spaces to provide coffee or tea in addition to the rented space. Some also attract renters by offering free education for entrepreneurs.

But that is not enough for WeWork, according to Fred Lu Shucheng, the general manager of WeWork China. Lu noted that the company comes up with various ways to strengthen ties within the network, including offline interests groups and an exclusive global WeWork member network. Through the network, which connects thousands of companies, WeWork members are able to build both personal and business ties in an economical way that allows both sides to feel trusted.

Developing "glocally" across the world, the company also boasts specialized services that vary from country to country and custom location designs for each city. WeWork designers try to meet even the tiniest requests, from unconventional working habits to coffee consumption. WeWork also tries to localize their designs so that each building is instantly recognizable as a WeWork facility, yet also entirely unique, according to Lu.

Lu offered the example of seat arrangement. "In the US or other international markets, people are less sensitive [when it comes to] whether people work next to each other or facing each other or back to back. But for us, we have strong cultural awareness that we want to work face to face," he said, also noting that WeWork China furnishes its locations with espresso machines, while US locations generally offer drip coffee.

Future of working space

Nearly a decade has passed since WeWork's launch, and already there is a clear ripple effect in co-working. As a co-founder, McKelvey said that he and Neumann imagine their company 100 years in the future, and believe that WeWork will remain competitive.

"What we see is people are becoming more mobile, defining work in a more diverse way. But at the same time, you need places for human connection. There is potential for more decentralized organization – for people to only come together at specific times, rather than [how it is done in] large corporate offices. I think especially as people become more interested in moving to cities, the efficiency must be greater. The solution must be more flexible and responsive to human connection," the CCO said.

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