China’s UrWork is helping the country’s start-ups emigrate into western markets by opening its first US co-working space in Los Angeles.
The Beijing-based company, which claims a valuation of Rmb8bn ($1.2bn), is also planning offices in New York and London, its first European outpost.
UrWork provides China’s tech start-ups with space and a range of services, including linking its start-ups with investors and partners, and offering its own business school classes on topics such as augmented reality.
As a result, the two-year-old unicorn is China’s dominant co-working office space company as well as a start-up incubator and professional services company. It has so far raised Rmb2bn in cash from VCs such as Sequoia Capital.
Despite entering its more mature US rival WeWork’s home territory, UrWork’s founder and chief executive Mao Daqing claims there will be no turf war. UrWork’s decision to launch in the US this month was taken as a result of the needs of its Chinese clients to go abroad, he said.
“We’re not going there to become the biggest co-working space provider or to compete with local rivals. We’re going there to help Chinese companies go out and to help foreign companies come to China,” Mr Mao said.
The company hopes to open its New York office in January and is exploring options for London by next summer.
UrWork’s all-in-one approach — part landlord, part start-up mentor — is a result of Mr Mao’s belief that China’s young entrepreneurs need all the help they can get.
“We serve China’s companies. The USA doesn’t need these kinds of functions,” he said, explaining the main differences between UrWork and WeWork.
“In developed countries, you don’t need officials to start telling everyone to innovate,” he said, referring to the government’s “mass entrepreneurship” policy. “In China, we lack experience and a solid foundation.”
Mr Mao describes the past four years as when entrepreneurship became “cool” in China, rather than a euphemism for under-employed. This led to China’s “sharing economy” taking off, and the rise of co-living and co-working spaces.
Property agency JLL estimates that there are more than 500 co-working sites in Shanghai and Beijing alone — nearly all of which sprung up in the past two years.
Mr Mao has called WeWork an inspiration, and said he has been friends for a long time with its founder Adam Neumann. He batted away the legal complaint that its US rival filed against his company in London in July alleging that the similar-sounding name infringed its trademark.
He is confident the case will be dismissed, saying there are hundreds of start-ups with “work” as the suffix.
WeWork launched its China unit [in July] after opening eight offices there over the past year. “They do many things very well,” said Mr Mao. “But like us in the USA, they are not locals here.”
Additional reporting by Yingzhi Yang and Xinning Liu in Beijing