WeWork fires back at competitor Codi with cease and desist
Reading Time: 2 minutesCodi, which raised $16 million in a round led by Andreessen Horowitz (a16z) in September 2022, set up booths outside WeWork offices in New York and San Francisco informing companies that their space might be shutting down and offering them to sign on with its rival instead. Codi also set up a ‘WeWork Relief Fund‘ offering those that might be affected by any potential WeWork closures discounted office space with Codi.
Once valued as high as $47 billion, WeWork has faced challenges with a model that involved committing to buying or signing long-term leases in buildings and then not having enough demand from people or businesses to lease or sublease its space.
WeWork not only struggled to bounce back after the COVID-19 pandemic wreaked havoc on its co-working business, it appears to barely be staying afloat. In August, the flexible space provider said that ‘substantial doubt exists about the company’s ability to continue as a going concern.’
As of Tuesday afternoon, WeWork’s stock was trading at a mere $2.22, down significantly from a 52-week-high of $130.80 and from a $520 high in 2021. Also in August, the 13-year-old company announced a net loss of $397 million for the second quarter on revenue of $877 million.
On Monday, WeWork announced it had appointed David Tolley to serve as its new CEO. Tolley, a former Blackstone executive, served as interim CEO of the embattled company since May. He took over that role when former CEO Sandeep Mathrani resigned.
Meanwhile, competitors have arisen attempting to take some of the company’s (albeit dwindling) market share, including Codi and Industrious.
In its cease and desist letter to Codi co-founder and CEO Christelle Rohaut, WeWork wrote: ‘We have learned that Codi, itself a provider of coworking space founded years after WeWork, has been making unauthorized uses of the WEWORK Brand and false and misleading statements about WeWork and its offerings to unlawfully solicit WeWork members.’ The letter accuses Codi of infringing WeWork’s brand and engaging in misleading advertising by claiming to offer a discount to ‘the first 50 WeWork members moving into a Codi space.’
WeWork also alleged that Codi’s campaign is ‘rife with false and misleading statements about WeWork’s offerings,’ including ‘disparaging’ language suggesting that WeWork offices are ‘far from where most people live,’ and that the company ‘does little to serve local communities directly.’
WeWork also alleged that Codi’s allegations that certain WeWork locations are closing are false and that it has not acquired the necessary permits to post signage and staff outside of its offices in New York City.
The letter requested that Codi ‘immediately and permanently remove and discontinue all use of and references to the WeWork Brand in any form, format, or style, including without limitation uses of the WeWork trademark and any confusingly similar terms such as stylized renderings of the term ‘WeWont.’ ‘
Ref: techcrunch
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