By Jay Van Luven
For many people, a new year represents a new start. A way to turn the page on old problems and forge a new path ahead. However, for many of us, New Year’s resolutions don’t always pan out. Our noble, if lofty, goals of going to the gym, eating healthier, or saving money often times give way to our old habits soon enough.
The moral of the story here is that simply declaring something to be different – our habits, our goals – doesn’t actually change anything unless you change the underlying problems that caused the bad behavior in the first place.
Companies are no different. Many times, when bad business practices or market problems arise, companies will try to reinvent their image with a glossy new PR campaign or a name change to convince the world – and investors – that their problems are over and a new era has begun. However, if the underlying causes of the problems aren’t solved, then nothing will really change.
This was on full display recently with WeWork, the co-working office space company, which was launched in New York in 2011, and has offices across the world, including right here in Missouri.
2018 was not kind to WeWork. Despite being able to raise significant funds, the company lost money at almost an equal rate. According to Recode, “[WeWork’s] net loss was $723 million in the first half of the year on about $764 million of revenue. That’s a larger loss than the same period a year ago when it lost $154 million on $362 million of revenue.”
WeWork’s problems continued at the close of 2018, when a planned $16 billion investment was downgraded to a $2 billion investment at a lower valuation due to stock market woes. This further casts the company’s sustainability in doubt.
WeWork’s solution? A glitzy rebrand and a name change. WeWork is now calling itself “The We Company” and is trying to pivot away from being solely a co-working real estate venture, and instead a multi-faceted organization containing ventures known as WeLive (residential) and WeGrow (education).
But just like a New Year’s resolution, simply saying things are different doesn’t change the problem. The company is still spending too much and isn’t equipped to deal with market volatility.
Not to mention its new name is already taken.
“The We Company” sure sounds a whole lot like the WE organization, a Toronto-based global charity organization started in 1995. The WE organization has several subsidiaries: WE Charity operates programs including sub-brand WE Schools, which provides free service programs in 16,000 mostly low-income schools in North America and Europe; WE Days, which fills two dozen stadiums with 250,000 student volunteers and broadcasts in primetime on ABC; WE Villages, which lifts over one million people from poverty in developing countries; and WE Companies, which helps to advise Fortune 100 companies to mom-and-pop shops about how to be positive corporate citizens.
A quick look at WeWork’s new We logo and @we Twitter account shows that the new WeWork is functionally trying to rebrand itself as “WE” and commercialize that brand across multiple product and experience categories.
Could it be that the billion-dollar company didn’t notice that they were stealing the brand of a well-established charity? Seems unlikely.
WeWork – just like any business struggling to reach their potential – needs to pick the right priorities. Rebranding isn’t going to ease its financial problems.
Here’s some free advice; WeWork should fix the foundation of its house before it adds a new coat of paint. Oh, and it should steer clear of stealing other organizations’ names.
Jay Van Luven is a small business owner and Executive Director of RBMR Services