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Illustration: Annelise Capossela/Axios

Before the pandemic, the co-working revolution, led by WeWork, was well underway. Then suddenly, sharing desks and beer on tap with strangers became unthinkable.

Yes, but: WeWork — and its investors — are betting that co-working still has a bright future. The company is in advanced discussions to go public via a SPAC sponsored by Vivek Ranadivé's Bow Capital Management, per multiple sources.

What's happening: The post-pandemic working world will be all about flexibility. The vast majority of workers want hybrid in-person/office work. That's pushing companies — especially smaller ones — to be nimble with their office space, and co-working is often the answer.

Background: WeWork tried to go public before the pandemic, but failed. Its founder and CEO were ousted, and then he and some of WeWork's venture capitalists sued the company's largest investor for bailing on a $2 billion stock tender offer.

  • That investor, SoftBank, wrote down the value of its WeWork holdings by billions.

Then, the pandemic hit, and the teleworking trends it propelled seemed poised to make a bad situation worse.

  • Before the pandemic, less than 4% of Americans worked from home. Now that has spiked to nearly 40%, and it won't go all the way back down when this is over. For a company that peddles office space, that appeared to be bad news.
  • On top of that, WeWorks have 75 square feet of space per worker, compared with the national average of 214. Close quarters like that can be downright terrifying for office workers who've spent the last year or more social distancing.

But, but, but: "We’ve always had a hypothesis that in a recession or in a difficult moment for offices, we’d be relatively well hedged," says Peter Greenspan, WeWork's global head of real estate. "Long-term commitments are an anathema in times of stress."

As a result, WeWork is leaning even harder into its short-term, flexible office space offering.

  • Over the last year or so, the company sold or shuttered a number of its side businesses — like a restaurant co-working startup and an elementary school — to focus on its core co-working business. The company also sold off a $60 million private jet.
  • During the pandemic, WeWork cut costs by shedding some locations, including ones that hadn't yet opened.

The big picture: The company's new CEO, Sandeep Mathrani, "went into this and was like, 'We do co-working, we do it well, so let's just do that and make it profitable,'" says Alex Snyder, a real estate analyst at CenterSquare.

  • And now, even traditional real estate firms want to get in on the flexibility. CBRE, one of the largest commercial real estate companies recently bought a stake in the flex space firm Industrious.

WeWork has a fix for fully remote workers, too. During the pandemic, the company launched an on-demand booking service that's basically Uber for offices. Anyone can download the app and book desk space or meeting rooms by the hour.

The bottom line: "That archaic concept of a 20-year or 15-year lease doesn’t work anymore, but there was no impetus to change it," Greenspan says. "What the pandemic did was accelerate the entire discussion from what could have taken another 30 years to a year."

What to watch: WeWork is not yet profitable, though it's on its way, "so there's still some risk," says Snyder. "But I do think up and to the right is the most likely scenario for them."

Go deeper

Everyone wants to be an influencer

Illustration: Aïda Amer/Axios

The number of people looking to become online influencers has exploded during the pandemic.

Why it matters: Almost anyone can find themselves in a position to become an influencer, and brands are throwing billions of dollars at online content creators.

At least 3 dead after Amtrak train derails in Montana

Photo: Jacob Cordeiro/Twitter

An Amtrak train derailed near Joplin, Montana, resulting in at least three deaths and multiple injuries to passengers and crew on Saturday, per authorities and a company statement.

The big picture: 141 passengers and 16 crew members were estimated to be on the Empire Builder train, traveling from Chicago to Seattle and Portland, when eight of the 10 cars derailed about 4p.m., Amtrak said early Sunday.

Updated 10 hours ago - Politics & Policy

Federal judge blocks vaccine mandate for NYC teachers

Students are dismissed from the first day of school at PS 133 in Brooklyn on Sept. 13. Photo: Michael Nagle/Xinhua via Getty Images

A federal appeals court is set to hear a challenge Wednesday to a vaccine mandate planned for New York City school employees.

Why it matters The vaccine mandate was set to begin on Monday, prompting concerns over staffing shortages in schools across the nation's largest school system. But a judge on Friday temporarily blocked the measure, per AP.

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