The Weekly Notable Startup Funding Report: 6/5/23 – AlleyWatch alleywatch.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from alleywatch.com Daily Mail and Mail on Sunday newspapers.
Why rental arbitrage doesn’t work: Knotel vs. Industrious
Knotel, once gleeful over WeWork’s downfall, succumbed to the pressure of rental arbitrage last week by (finally) filing for bankruptcy.
In recent months, the startup led by CEO Amol Sarva faced mounting lawsuits alleging it stopped paying rent. In a Chapter 11 filing, the flex-office provider listed assets and liabilities between $1 billion to $10 billion.
The bankruptcy filing includes $20 million in financing to aid with Knotel’s sale to Newmark Group a deal that implies there’s a future for flex-office, just not as Knotel had imagined.
And then there’s Industrious. The Brookfield-backed startup, which signs management agreements with landlords, has 3 million square feet of space and plans to add another 1 million in 2021. It has opened three New York locations since the pandemic hit.