Our fave business stories this winter
Story #1: WeWork WeCrash
Have you ever met a person, and thought: “You are full of shit”.
That’s how WeWork founder, Adam Neumann was described by his future wife. On their first date.
It’s 2017 in NYC. Adam Neumann steps out of a taxi. He has just raised $4b from Alibaba investor SoftBank.
The deal is done in less than 30 minutes. In that moment, WeWork is valued at $47b. Today its worth <$3b.
This is the story about the rise and fall of WeWork.
In the beginning it was Adam and 4 employees. It is 2010, and the rise of co-working spaces.
But Adam wasn’t interested in just renting out desks.
On a mission to “elevate the worlds’ consciousness”, Adam wants to start a “We” revolution.
He starts filling buildings all over Manhattan. And quickly becomes the biggest office tenant in NY City.
3 things go wrong:
- Crazy excess
- A Christ-like founder
- Capitalism gone mad.
A glossy IPO. Filled with “Yoga Babble”. Poor governance. Adam is forced to step down as CEO.
Great marketing adds value. But the market will catch on eventually. This time it was more “Me” than “We”.
Story #2: Web developers and market changes
This is the familiar story of the eternal search for the perfect web dev.
A big part of Long & Co’s job is to source the right talent for a project. This week, we’ve been talking with web developers. This made us think: The market is really changing.
Not only has the old agency model been replaced by independents like Long & Co;) The whole web dev landscape has changed.
Take the rise of the creative developer as one example. So talented. So booked. Communication: optional.
Then there is the code dev. When it absolutely, positively has to be built on a particular tech stack. (If you don’t follow, just think: a place only that dev can go).
And hey. They’re probably right. React.js or Vue.js might be superior. But how is the client going to be able to update a text field or upload an image in that environment?
No we don’t want templated websites or email marketing that disrespects our inbox. Nasty.
We want our customers to know we exist. We want them to like us. And ideally also decide to buy from us when the timing is right.
The moral of this story is that the market is changing. The network economy is connecting talent, without the big agency overhead.
So when you are up for it. When you are ready to explore an alternative to your current agency or web developer. There are options out there for you. And yes, Long & Co is one:)
Story #3: Kogan has a brand problem
This is a story about how online retailer, Kogan, is building brand on bricks and mortar reputations. And the problems he still faces despite his efforts.
In May 2020 Kogan bought replica furniture brand Matt Blatt for $4,4m. Before this, I had not paid Kogan any mind. But this purchase got my attention.
Photography by SMH.
My impression of Kogan turned from sceptical to: Wow. What a clever move. Buy the reputation of an established business. Close down its retail stores and move everything online.
Kogan’s share price responded by going from $6 to $22 in the past few months. That’s a 260% increase.
Is Kogan undervalued? Yes. Is it an Amazon worth $3000 per share? No way. Why? Kogan has a brand issue.
The market doesn’t trust Kogan. And our court system just gave us good reason not to.
This month, a court ruled that Kogan had misled its customers. By inflating its EOFY pricing only to discount them back to “normal” prices.
Is the strategy of online retailers buying established brands and moving them online sound? Yass! Is Kogan undervalued? Probably.
Kogan is getting in the way of its own success. Brand and trust matters. It seems this particular zebra is having a hard time changing its stripes.
Let’s see if they can shed their skin.
About Long & Co
Long & Co is a small strategic brand alternative to a big agency. We offer everything an agency does, without the overhead.
We have a network of web developers and creatives across Sydney, Newcastle and Byron Bay.Get In Touch With Long & Co