To say that Mao Daqing’s life has been a whirlwind over the past two years would be an understatement. The founder and CEO of UrWork, China’s largest co-working provider, has been working more or less non-stop since he established the company in April 2015. Not that he’s complaining about it.
To date, Mao has opened 100 locations in 33 cities around the world, servicing over 4,000 enterprises with an impressive occupancy rate of 85%. The startup-turned-unicorn counts Sequoia Capital, Zhen Fund, Noah Wealth Management and Sinovation Ventures among its investors, having reported a C-round valuation of $1.5 billion as of August 2017.
UrWork also merged with its Chinese rival New Space in May, opened its first overseas location in Singapore in June and formed a joint venture partnership with New York’s Serendipity Labs in July, with plans to open up shop in the Financial District in January. UrWork also made a strategic investment in September in Rework, a co-working provider in Indonesia, to strengthen its network in Southeast Asia. And just last month, UrWork announced a new strategic alliance with Homeinns, China’s largest hotel chain, to form the largest network of bookable spaces in a single market.
It might come as a surprise that Mao decided to set his sights outside of China before securing his foothold in his birth country. As he explains it, “Globalization has always been our main orientation, but we’re not going to the US to become the biggest co-working space provider or to compete with local rivals.” said Mao in a phone chat. In China, Mao has also partnered with the government and over 20 credited service suppliers to help foreign SMEs enter China with greater ease, “We're going there to help Chinese companies go out and to help foreign companies come to China,” he mentioned about UrWork’s expansion into the West.
Mao is particularly proud of UrWork’s vertically integrated platform, which provides in-depth services, launched earlier this year with more than 250 providers. It may not be so different from WeWork’s services store, but Mao is confident in the value his vendors offer, “You can pay RMB299 per month and enjoy the community activities, amenities and bespoke services that come with it,” he said. “We have packages that cater to corporate and individual members.” he said.
These include over 20 service providers – a figure that is constantly increasing, according to Mao – ranging from information technology, legal, human resources, accounting, business consultancy, healthcare and media development. All this is parked in UrWork’s proprietary app, which helps tenants quickly locate business partners.
Mao says that coming late into the market – co-working as a concept was termed in 2005, and WeWork was launched in 2010 – has given him an advantage in that he’s positioned to learn from others’ mistakes and plug up gaps in the market. Even though he started UrWork in China in 2015, the industry was still in its embryonic stage there at that time.
Mao remains bullish about the co-working industry’s projected growth. At present, there are approximately one million tenants in these spaces around the world, but he expects that figure to grow by leaps and bounds. According to the 2017 Flexible Working Space whitepaper by Colliers International, co-working spaces will retain a steady growth of 30% per year . According to the same report, by 2030 over 30% of office spaces will be co-working – a number heralding strong growth momentum for the sector.
As startups become more ubiquitous and millennial entrepreneurs become a “new normal,” co-working is gaining traction with the younger generation, who find the community services and business synergy opportunities appealing. Multinational corporations too are choosing co-working spaces, instead of the traditional corporate office.
In light of these trends, Mao believes that the relationship between commercial developers and space operators needs to evolve into a partnership model, “Our recent partnership with Kunming KCC to co-develop a 330,000sqf complex integrating shopping, co-working, co-living and entertainment functions, as well as our earlier partnership with CapitaLand China to open Capital Mall, are testament to that,” he said. “As space operators, we bring with us the efficiency and knowledge of aggregating and optimizing resources and community building experience, which makes our partnership with real estate developers a win-win solution.” he continued. Does the competition faze him? After all, WeWork recently raised $4.4 billion from SoftBank to fund its expansion plans, particularly into China, Japan and Southeast Asia while filing a complaint against UrWork for trademark infringement and unfair competition. Mao thinks the market is sizable enough for multiple players, “UrWork is headquartered in Beijing, so China has been and will always be our starting point,” he said. “We have a bigger market volume here, and we know the needs of Chinese entrepreneurs (in China and overseas) better, laying a solid foundation for our fast-scaling and service integration.” said Mao.
He also cites other factors like a strong team, his own background in commercial real estate and multiple strategic partnerships with the Chinese government as advantages. Just as compelling are UrWork’s suite of integrated IT services and its unconventional amenities such as facial recognition and IoT technologies available in the office spaces.
Given its trajectory, it is no surprise to learn that Mao has IPO plans in the pipeline within the next two or three years, “Every company aspires to return to society and have a bigger impact; we are no exception,” he says. “There are many SMEs that need infrastructure and services to support them to grow, and we want to fulfil that responsibility.” said Mao.
Fundraising aside, Mao is also interested in building an eco-system with co-working at its core, “Creating a truly connected platform and community takes time, we need to unify more parties, and connect humanity with technology to collectively push the frontier of the next wave of human evolution.” he said. Mao has no plans to deviate from UrWork’s commitment to support 10,000 SMEs to grow, and he intends to boost the number of locations to 160 in 35 cities in the next three years: “With a coherent strategy, nimble adjustments, focus on the goal, perseverance and tenacity, we are sure to hit the finishing line.” he summed up.
