Chinese co-working unicorn URWork closes US$179m funding round ahead of global expansion
Chinese co-working space unicorn URWork, backed by Alibaba-affiliate Ant Financial and Sequoia Capital, said it has closed a 1.2 billion yuan (US$179 million) pre-C fundraising from a group of Chinese investors, to push forward its global expansion.
The Beijing-based shared-workspace startup, a rival of WeWork, announced it received the pre-C round financing from state-owned property developer Beijing Capital Land, conglomerate Beijing Xingpai Group and Beijing Love & Health Group (also known as Beijing Aikang), as well as investment firm Jingrong Holdings.
The company declined to disclose its valuation after the new funding deal, but said in June this year that it was worth US$1.3 billion when it landed its first shared workspace deal outside of China, in Singapore.
URWork’s latest announcement comes as China has seen increasingly fierce competition between large domestic operators of co-working centres, which offer similar chic working environments, open spaces and the free use of smart services. Many of them have been in a race to grab global market share.
Adding to its planned first facility in the US in New York, URWork will soon open its second US facility in Los Angeles and expand into Hong Kong and Taiwan within the year, URWork founder and chief executive Mao Daqing told Chinese newspaper 21st Century Business Herald in June.
The company is also looking at launches in San Francisco, London, Paris and Berlin, as well as Southeast Asian countries a bid to challenge WeWork.
“Our overseas footprint will partly overlap with WeWork, but our vision is more on helping small Chinese companies go global,” Mao said at the time.
Overall, the start-up is targeting 100,000 seats at 160 facilities in 32 cities worldwide over the next three years.
Separately, on July 19 Shanghai-based rival Naked Hub agreed to merge with Singapore-based peer JustCo with the goal of creating the largest premium co-working space operator in Asia.
Following the merger, Naked Hub aims to have 41 work spaces up and running by the end of the year, including new locations in Southeast Asia such as Jakarta, Bangkok and Kuala Lumpur, and is eyeing its series C fundraising with a valuation of US$1 billion.
In its statement on Monday, URWork said the introduction of Jingrong Holdings in the latest round would facilitate the start-up’s expansion in the US and other overseas markets through its overseas capital markets experience.
In January this year URWork became the first company in China’s co-working space to achieve unicorn status – reaching a valuation of more than a US$1 billion. Of about 60 sites it has opened, more than half are in Beijing and Shanghai.
The company was founded in 2015 by Mao, the former Beijing president of property giant China Vanke.
A new report by CBRE showed co-working space operators have leased 2.5 million square feet of office space in first tier cities across Asia Pacific over the past 18 months, led by China and India, but only 39 per cent of the centres are making money.