WeWork’s Plan for Metropolitan Domination
If you enjoy this article sign up to my newsletter HERE
2U have signed a deal with workspace provider WeWork. There are several elements: 2U will pay $13m to lease Flatiron’s (the coding bootcamp acquired by WeWork in 2017) learning platform learn.co, 2U students will be able to use WeWork office space, 2U will make up to $5m in scholarships available to WeWork members and the two will work to create a new learning centre at a WeWork location in 2019.
2U gain closer access to WeWork’s 175K membership and the learn.co platform. The latter is a learning management system that will become the new front-end for 2U — a recognition that perhaps their prior platform wasn’t all that. The strategic push here however is around 2U’s pivot towards the short course market. That started with their acquisition of GetSmarter last year — an acquisition which also brought an international audience to 2U who were previously US focused. WeWork’s membership is both international and a key target market for short courses (think of the ‘tech bros’ salivating for Oxford University’s short course on Bitcoin).
It also raises the question of the value of physical and social learning spaces for online. Coursera experimented with semi-supported meetup groups to support learners, Udacity have developed their Udacity Connect including the latest in Reno. Physical has obvious advantages namely it improves learning and retention, removing some of the isolation of online, 2U have noted in the past how their best partners invite students to open days even if they are only doing online degrees — evidently 2U wish to extend the logic of offline further.
All strategic, all good. But what is WeWork’s play? As far as I can see, WeWork’s insight is that in the knowledge economy, real estate is critical. After all, such economies are defined by densely populated urban areas where by definition space is hard to come by. WeWork’s approach was to target the unmet need of gig workers and startups who needed smaller spaces on more flexible leases. They forged their brand around the ‘startup’ vibe — bringing a cool hitherto unseen among real estate developers and have continued to expand.
But why Education? WeWork have featured twice in this newsletter when they acquired Flatiron coding bootcamp and again this week. This move makes sense if you see WeWork in a similar vein to Amazon. Take control of key infrastructure (in this case urban real estate) and then use it to vertically and horizontally integrate. Flatiron is the former, WeWork now offer space and coding education themselves. 2U is the latter, leverage the existing assets. It’s that ambition underpinning WeWork that makes me think they, rather than 2U are the more interesting proposition here — here
If you enjoy this article sign up to my newsletter HERE
