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WeWork
Reuters/Stringer
The singularity is near.
TWO BECOME ONE

WeWork’s purchase of Managed by Q shows how two big office trends are merging

By Sarah Todd

The world of office startups is fast approaching its own singularity moment.

The co-working giant WeWork announced today that it’s buying Managed by Q, a startup founded in 2014 that allows businesses to hire on-demand service workers, from receptionists to caterers and cleaners. The two New York-based companies did not disclose the financial terms of the deal; Managed by Q was most recently valued at $249 million after a financing round in January.

WeWork, which built its brand by renting out industrial-chic workspaces to startups and providing large corporate clients with flexible satellite offices, is continuing efforts to diversify its $47 billion international business beyond the realm of real estate. And, as the Wall Street Journal notes, “Managed by Q works mainly with medium and larger-size companies, an area of the market where WeWork wants to expand after building a customer base focused on smaller companies and large corporate customers.”

It’s also worth noting that the merger represents the convergence of two different approaches to workplace disruption and the on-demand economy. Managed by Q began as a cleaning service. It was distinctive in its approach of hiring its own staff of W2 workers who could then be farmed out to client companies on an as-needed basis, as opposed to relying on the typical gig-work model of independent contractors. From there, it expanded to hire IT workers, office managers, and more. WeWork, meanwhile, got its start in 2010 by renting out office space, then moved into a host of other services, from renovating other companies’ offices to managing their facilities.

In other words, WeWork wiggled its way into companies’ hearts and pocketbooks by luring them in with real estate for rent, while Managed by Q got its foot in the door with workers for hire. Both kept expanding from there. Now their two distinctive approaches to modern offices—each clearly successful in its own way—are about to become one big operating system for workplaces around the world.