WeWork in Shanghai?Rivals don’t bat an eye
Print Edition
WEWORK’S entry in the Chinese domestic market doesn’t seem to be troubling local competitors in the same work-share business.
“Let’s see what this wolf can do here,” Yang Pengbo, founder of Gennesis Investment, said of the New York-based rival.
Jing’an is already home to 22 shared-work venues, many of which function as incubators for startups.
One of them is People Squared, founded by Shanghai native Bob Zheng in 2010.
He first turned an old villa on Huashan Road into a communal work area for young innovators to meet and brainstorm. The success of the site convinced him to expand. He took over a renovated warehouse on Changping Road.
His company now operates 16 sites in Shanghai, nearly half in Jing’an, with another three in Beijing and one in the Zhejiang Province coastal city of Ningbo.
“Our aim is to bring the most fascinating people and the most interesting projects together,” said Huang Wei, the community director for People Squared. “We provide a place where they can come in contact, build relationships and explore endless creativity options.”
The People Squared community now has about 10,000 members.
Like WeWork, it encourages users to build their own business ecosystems, sharing services such as legal service, financing service and human resources service.
“WeWork’s arrival is a good thing,” Huang said. “We don’t put money on ads, but WeWork is raising awareness about shared workspace. We see opportunities rather than a challenge.”
Zhou Wei, executive of XNode, another shared workspace company and startup assistant, said WeWork will add competitiveness to the marketplace but it won’t dislodge domestic firms engaged in the business.
“Many young entrepreneurs who come to China may identify with WeWork because of its overseas profile, but when they come here, they need to meet Chinese people and learn to do things the Chinese way,” Zhou said. “In that respect, local shared-work sites offer them more benefits.”
Zhou and his XNode team are all former senior executives from international consulting firms like McKinsey and Roland Berger. They use their experience and business acumen to help match multinationals with appropriate local startups.
That tends to suit established corporations, who want to move slowly in identifying innovation that may benefit their operations.
XNode now has three sites in Shanghai, and two others are scheduled to open by the end of this year. The Jing’an space, the company’s second site, opened last November.
Though a relative newcomer, XNode prides itself as being one of the most international of the shared-work places in Shanghai. Its 300 clients come from 15 countries and include big names such as Mercedes Benz and Standard Chartered Bank.
For its part, Gennesis Investment said it is trying to changing the economic landscape of traditional industries by helping listed state-owned firms adopt new digital technology and upgrade their operations.
Founder Yang compares state-owned enterprises to high-end Audis and startups to lower-cost Suzuki Altos.
“Now, many incubators are try to help Altos clear away obstacles and drive more efficiently,” Yang said. “Finally, they will polish the Altos and turn them into Audis. We don’t print money; we just move it in the right direction.”
Most work-share sites in Shanghai charge about 2,000 yuan (US$299) a month for a desk. By contrast, Chulei charges just 300 yuan.
“We are grassroots,” said co-founder Zhang Junrui. “We like to think of ourselves as small but beautiful.”
Chulei was originally a video content maker. It made its name by focusing on Internet startups, parlaying its strong business connections.
Chulei’s work-share focuses exclusively on media-related startups, from sound-activated QR code technology to virtual reality content providers. The only criteria is that they be innovative.
“Our space doesn’t have fancy decor and we don’t provide amenities, like free tea or coffee,” Zhang said. “We want to keep costs down to levels that young startups can afford.”
But whatever these companies say, there is an element of competition present as their numbers grow, and creativity is needed to stand out from the rest.
People Squared in April began issuing “P2 passports” that give members free access to each of its work-share sites, including offices under its partnership with Google in the Silicon Valley.
“The next era will be ultimate sharing,” said Huang. “It will create values and relationships beyond your imagination.”
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