David Rosenthal: evaluation

Transcript context

…If you can wait eight years, here is my company. The company I’m working for is going to collapse. There will be storefronts everywhere. Yeah everywhere. So, Miguel is like, “Dude, don’t go looking for office space in Manhattan. That’s stupid. Come to Dumbo. Rents are cheap here. It’s super awesome. It’s really hip. You’re going to like it a lot more.” He convinces Adam to move into the same building that his architecture firm is in Dumbo. This is 2008. The financial crisis is happening. Rents are super cheap. There’s proverbial blood on the streets in New York. I was there. We all remember this. Real estate is plummeting. These two are two entrepreneurial guys. They cook up this idea. They’re like, “There are some empty floors in this building that we’re in, here in Dumbo. What if we convince the landlord to let us take over one of these floors and then we can stuff some more people into it and make the arbitrage on the rent.” They decided this is a good idea. These two new fast friends, they did it. They convinced the landlord. He’s like, “Well, I can’t move this floor anyway.” They give it to them and the idea is this is going to become like Airbnb for office space. There’s a Forbes article a couple of years later in the early days of WeWork and they say, “Sort of like Airbnb but maybe a better analogy is like an airline operator,” because really, what they’re trying to do is take a physical asset and squeeze as many people into it. Just like coach on an airplane. It turned out, I think, the financial dynamics of this business look a lot more like an airplane operator than they do like Airbnb. Anyway, it’s actually a great idea. Very quickly, the space gets filled up. They listed on Craigslist. They’re like, “Hey, we’ve got desks here.” They decided to call it Greendesk. They think like, “This is going to be eco-friendly. That’s what’s going to appeal to these types of of folks that are new age entrepreneurs. They care about the environment.” Then, they only stock environmental products so it’s like all Seventh Generation sort of like CPG stuff throughout the—…

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