WeWork has just signed a three-year deal to provide office space to 250 staff of gym membership app startup Gympass in New York, Reuters reported, citing sources with knowledge of the matter.
The deal, which was made possible with the support Softbank Group Corp, is a sign of a positive transformation for the office sharing startup.
Softbank owns a minority stake in Gympass. The signing also shows Softbank's serious attempts at pushing its financial asset businesses to work with and capitalize on each asset's services and boost the unicorn startup's market status, the sources said.
Originally established in Sao Paulo, Brazil, Gympass currently operates in Manhattan, New York City's SoHo area. The startup is said to be setting its sights on tripling its branches in the city.
Approximately 25,000 workers at Softbank-supported firms, which include US ride-hailing startup Uber Technologies, Brazil's online real property broker Quinto Andar, and online property site Compass, are in WeWork offices, Reuters said.
Although Softbank owns a minority share in Gympass, it does not have total control over it, but the bank encourages its portfolio companies to support the deal, according to sources.
Softbank bailed out WeWork from bankruptcy in 2019 by taking full operational control. The bailout followed a failed attempt by the office sharing company to roll out an initial public bid in September, which left WeWork financially crippled.
In the first nine months of the same period, WeWork mother company - The We Company - suffered more than $1 billion in total losses, twice the losses the company incurred, year-over-year.
Globally, WeWork has more than 650,000 subscribers, and hopes to breach the 1 million mark by early next year, the sources bore.
Founded by Miguel McKelvey and Adam Neumann in 2010, WeWork provides its customers with space, community, and services through physical and online offerings. As of second quarter last year, WeWork had 528 locations in more than 111 cities in 29 countries.
Gympass, which was not previously a WeWork customer, offers gym access to employees via a network of more than 50,000 gyms and studios around the globe. It was lasting valued last year at $1 billion through a $300 million fund-raiser spearheaded by Softbank, PitchBook figures showed.
Since 2010, WeWork has raised almost $13 billion in funding. In January this year, it backed out of an S-1 Filing and cancelled its IPO. WeWork's current public valuation is about $10 billion, which is below the $12.8 billion the company had raised since it's founding.
