URWork, China’s co-working unicorn, announced today an RMB 200 million ($29.41 million) strategic equity investment from Beijing’s Aikang Group (in Chinese) to boost its ecosystem of support services for customers. With over 20 years investing in healthcare, finance, hospitality and real estate, Aikang Group will bring resources from the traditional sectors to help build a “highly innovative and specialized service-oriented co-working experience” that will go into effect in the first half of 2018.
The new investment adds to URWork’s six rounds of funding totaling RMB 1.2 billion ($175 million) and one merger since its inception in April 2015.
According to founder Mao Daqing, a former executive at Chinese real estate conglomerate Vanke Co., Ltd., URWork’s annual revenue is at around RMB 400 million ($58.5 million), of which 75% comes from office space rental.
“These are just the revenues that are tangible, but there is a lot of hidden money,” says Mao in an interview with local media (in Chinese). Mao is referring to the 25% revenue generated from its value-added offerings such as financial services, human resources, and healthcare, which will be enhanced by its new strategic investment partnership from Aikang.
URWork currently serves 2,400 companies in 24 cities across China and started its overseas expansion in the second half of 2016, opening locations in Singapore, London, Taiwan and New York City, an already crowded market dominated by its American competitor WeWork.
Back in China, the tug of war between the two co-working unicorns heated up when WeWork announced $430 million in funding from Chinese investors, shortly after which URWork confirmed its merger with New Space, a rumor that had circulated around for over a year ago.
“We are not looking to create a monopoly. It will only be a matter of who becomes big, and who remains small, much like in the hotel industry,” comments Mao.