WeWork is finally letting go of one of its business units, Managed By Q Inc., which the company owned for only eight months, according to sources. The deal could be the answer to the troubled office-sharing company's continuous slump.
A group of investors and executives, including Managed By Q co-founder and former chairman Dan Teran, are trying to acquire the unit back from WeWork, sources disclosed.
Discussions are currently ongoing and WeWork is actively processing a business resolution, the sources, who requested anonymity, said.
Earlier this year, WeWork bought Managed by Q - which offers technology to help companies handle and manage activities and resources - with the aim of integrating the expertise of the smaller firm with its own global scale to "deliver an innovative and streamlined office experience for growing businesses everywhere."
Turning Things Around
Teran spoke on a panel at Wednesday's SALT conference in Abu Dhabi and asked about Teran's plans by moderator Omeed Malik, chief executive officer of Farvahar Partners merchant bank.
"I am working actively to buy back my business," he said during the conference's live stream. After selling for a reported $220 million, Teran said he thought it had been done to raise Q-managed capital. "And here I'm doing it again six months later," he said.
Teran was speaking to investors at another conference in Abu Dhabi the day before, hosted by the tech and venture capital company Hub71.
Teran also said on Wednesday's panel that he is planning to bring his management team back to help run Q as a stand-alone company.
It was not possible to ascertain the cost of the contract under consideration. According to a TechCrunch report citing PitchBook details, Managed By Q was worth $249 million in a funding round in January.
Terminations, Losing Spree
In recent years, WeWork acquired or funded many startups during a growth spree. This expansionary drive has led to losses that reached billions of dollars and some of those transactions may be unwound after a failed initial public bid earlier this year.
WeWork has run to financial investor SoftBank Group Corp. for a rescue package to keep it going, part of which will oversee businesses on the company's side and focus on making its core operations sustainable.
WeWork listed several assets and subsidiaries as possible divestments in an October investor briefing, including The Wing, Meetup, SpaceIQ, Teem, and Wavegarden. As it seeks to produce positive cash flow by 2023, the office-sharing company is also eliminating personnel in its New York operations.
