Miguel McKelvey, a multi-disciplinary designer and entrepreneur is the Co-founder and Chief Creative Officer of WeWork. Started in 2009, WeWork grew to become a shared workspace behemoth that did +$1b in revenue before collapsing this year.
Miguel McKelvey met Adam Neumann at a party in New York City. At the time, he was a veteran of several late-90s and early aughts startups and manager of an architectural firm. The two paired together to create WeWork, a co-working space that made, by 2017, was making $1B in revenue.
But WeWork was also losing money — quickly. Despite lofty valuations (it received $9B in funding and was valued at $47B), the company sputtered in 2019 before it was set to IPO. McKelvey remains as WeWork’s chief culture officer and was reportedly the main point of contact as the company tried to rally its remaining employees in the wake of Neumann’s exit and layoffs.
Before WeWork imploded in 2019, McKelvey spoke at Hustle Con in 2017 about the early days of the company, its ability to connect with customers and the importance for entrepreneurs to not have an “off switch.” Below is a lightly edited transcript of his speech.
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Good morning. That’s a really huge picture. Actually, I told people to never to use that picture ever again because I’ve seen it so many times and I’m tired of looking at it. I guess no one got the memo. I’m super happy to be here this morning. I don’t know if I’ve ever spoken to a group this large and in this beautiful of a place, so it’s an awesome opportunity. The other part of this is that I don’t normally prepare for these things. I like to just come out, kind of like Casey did, just talk about the things that are on my mind. But in this case, these guys challenged me to say something that’s actually meaningful and relevant to you guys, so I’ve tried to put together something that will have impact. We’ll see if it works out, but there is a little bit of organization, which I’m not used to.
A little bit about me, I’m an entrepreneur from the early .com days. I started my first company in, I think, ’98. It was a social network for people learning English as a second language. It still exists, it’s called English Baby. Really, I came out at a time when, much like today, where entrepreneurs are celebrated. While I studied architecture in school, there was a feeling that anyone could start a company no matter how smart or not smart, or experienced or inexperienced you were. I got a very early experience with starting something and going through the process of trying to create something from the ground up. I think that was an incredible opportunity to explore myself and figure out who I could be, but it was also an amazing challenge because there was no mentorship. There was no one to help. There was no one with any instructions. It was a time when you had to figure everything out for yourself.
I’ve always remembered that time. A lot of the spirit that you have at that time is self. It’s you trying, against the world in a way, you trying to make something happen, trying to bring something new to life. When we first started WeWork, we felt like we could create an environment where we could remove some of that isolation. Where we could create an open place and a supportive place for people who wanted to do these things in the world. We believed that we would all be stronger together, that if we were open to each other, if we were interested in each others journeys, if we wanted to lend a hand then there was a forum and a community that would allow that to happen in an ongoing way. Whether it’s through events like this, or just in an afternoon over a cup of coffee, that creating that rich environment would be better for all of us.
Hopefully, some of you guys have heard of WeWork. Actually, hopefully all of you guys are members. That would be awesome. If you’re not, join tomorrow. Best advice for any business of any size. We started about seven years ago and we’ve achieved some success so far. We’re in cities all over the world. We have over 120,000 members. I think one of the coolest things that we’ve achieved is we have united a community that is in China, Korea, Australia, all over the US, across Europe, Tel Aviv, and now in South America, coming soon in India. What we’re finding is that people like you, people like us, people who are connected to this idea of being creators, of trying to bring new things to life, that they’re everywhere. It’s a bond that we share when we’re at this place in our life where we want to take hold of our future. That bond is something that crosses all boundaries, I think, from political to cultural. When you have that in yourself, it’s something that allows you to connect with others.
WeWork is hopefully a platform for anyone who is in that position. We’ve been lucky to bring people together in business contexts, many different kinds of business contexts. We started with small entrepreneurs and startups, but now we’re working with some of the biggest companies in the world from big tech companies, to banks, et cetera. We’re all trying to ignite this same spirit of innovation and creativity, and really just positivity for these challenges that we’re all facing. To get a little more specific about who I am and the journey that I’ve been through to get where I am now and really where we are now as a company, I have a few specific lessons. The first one is that my co-founder and I, Adam, are extraordinarily, extremely different people. I came to New York City from Oregon with an idea that I wanted to achieve something in the world. I didn’t know what it was, but I felt like New York was the place to do it.
One random Saturday afternoon I met this guy who was brash, Israeli. I’m from Oregon. For those of you from the west coast, especially from here, you know we’re chill, and for the most part relaxed. We have our own vibe. Then I go to New York City and I run into this guy who is the exact opposite literally, all energy all the time, always hyped, always excited and with tons of exuberance, and really no fear whatsoever in any context, willingness to do anything at any time. When I was exposed to him I had certainly a lot of discomfort, well, a lot of discomfort, but what I also knew was that there were things that he could do that I could never do. I was clear from the start that there were things about him that, especially in the business context, there was no way I could do. One of those things certainly is sitting in front of a group of investors and asking for money at a $100 million valuation, or a $5 billion valuation, $10 billion. Now we’re above that.
I knew that I would never be that guy, but I knew in him that he had a certain capability. This profound difference was attractive to me, but I also knew that it was going to be hard for us in a business partnership because we approach things from totally opposite ends of the spectrum. One of the things when we decided to come together and form the company, we knew this about each other, we knew that we were going to approach things differently, and so we agreed early on that we would always agree. That we would always come to a decision where we would consider each others perspective. We would not necessarily meet in the middle, but we would make sure that we were both in a place where we were comfortable with the solution. What that did, which was profound, was that because we knew the other one would have to agree and we knew that we couldn’t move forward until we agreed, it meant that we were always thinking of the others perspective before the other one even said it. We would almost walk into the room offering each other the opposite persons perspective. It’s like we’d already thought through it so much that we’d already come to a resolution.
Over the last, really, ten years that we’ve been working together, it’s been almost always smooth sailing because we already had worked through it and come to the right middle ground before. I think it’s an important thing, especially when you’re looking for a business partner, a co-founder, a close executive team member, is, one, to look for people that are different than you, that have different perspectives, that are going to infill some of your deficiencies, but then also create a structure that respects the fact that you’re different and, in our case, create a structure that ensures that you’re going to be able to move forward. The lesson here is never leave a room without an agreement. To add to that, never let conflict go beyond the conversation, go beyond the moment, because no one wants to carry negativity and conflict. Once you come to a decision, be willing to live with it and move on so that therefore the business can too. The second thing, which of course if any of you guys are engaged in the struggle you know it’s hard, and certainly when you’re in the early stages of a company that there’s people doing a lot of things on their own.
You might have one founder, or one key team member, totally responsible for an entire component of the business. You might have someone working on product. You might have someone working on sales. Someone else on, say, finance or marketing, or even two founders, just three founders, whatever it is, split in half. One person doing this, one person doing that. It’s really hard sometimes to see the other persons perspective if you’re not working on it, if it’s not your world. For us, one of the things that was challenging early on is that we had the product side. We’re building out these buildings and we wanted to make them really cool. We wanted beautiful design. We wanted the best sofas you could get in our spaces, but we also needed to build extremely fast. A big part of our business model and the success of out model was to build quickly and to execute really quickly. There was always this tension between how do we get the best product, but how do we do it extremely quickly? How do we deliver the best experience to members, but how do we ensure that no matter what we open on the first of the month when they’re going to move in?
We would have arguments about very specific things that affected that back and forth. What we found was the most important thing for us to solve that and to get through those challenges was to involve each other in them more specifically. For us, the cool thing is that we have these openings, well, in the beginning every six or eight months, and now we open anywhere from 10 to 15 buildings a month, but the opportunity there was to involve each other and involve the whole team in these openings. You had people in every part of the company taking part. Whether that was painting walls, whether that was making coffee the morning the members moved in, whether it was taking the mugs out of the box and putting them on the shelves, whether in some cases it was doing art projects, painting murals. It allowed someone who was working on finance, someone who was in legal to take part in this collective. It broke the silos between us. It allowed us to understand each other better and to see each other in a different context than the normal day to day work environment.
I think the lesson that’s important is you can do better as a group when you know each other better, when you experience each other emotionally in different ways. The best way to do that is to get everyone involved at some time. Look for the challenges in your business where you can actually assemble a group and take it on together. The third thing, which this one was a funny one to remember, was when we first started we were lucky enough to start WeWork with our own money, for lack of a better term. We were brash. We were pretty confident in ourselves and what we could accomplish. We did pretty well in the beginning. Our buildings were really successful. Members came in and joined us. The buildings were profitable in the way that they operated, so we were confident in our model. We were lucky to get support from some early angel investors.
One day we got a call or an email, but anyway, so we get this inquiry from this guy who says, “Hey, I’m with Benchmark Capital. I was visiting one of your buildings today. Some of my portfolio companies were in your building and I really love the environment. Are you guys looking for investment?” We’re like, Benchmark Capital? I don’t know. We looked at their website. Oh, yeah, Benchmark Capital. They’re legendary VC’s who, obviously now, are supporting some of the best companies in the world, but certainly their history, they’re one of the earliest supporters of Ebay and made billions, et cetera. They invited us to come out and pitch to them. Adam and I, we thought it was pretty cool to go to Silicon, whatever it’s called, the valley, and pitch. We didn’t feel like we needed them, we just thought it was a cool opportunity to pitch and go to Sand Hill Road and do that whole thing.
We made the pitch and apparently they liked us, because shortly after they said they wanted to invest. We were thinking, what’s the valuation? What should we say? I think, round number, $100 million sounded good. Then, just because we always want to push it we said, “I think $110 is better.” 110%, right? That’s what we should be aspiring for. Benchmark, I think, was more thinking $70 million, I don’t know, $75. We had some distance between us. There was a moment through the negotiation where we had been back in New York, we forgot how cool it was to sit in front of them. We actually were considering, if they’re not going to agree with our $110 maybe we just won’t do it, because we felt so strong and so confident in our business and we were confident in who we were. We also felt like we impressed them so much, the fact that they wanted to invest at all meant that we should stick to our guns and try to get the $110.
I remember the moment where Adam and I sat down. Something came over me and I realized with all this ego and all this feeling that we should win this, that we’re probably missing what’s really important. We’re probably missing the fact that the value that Benchmark will provide as a partner is so much more important than this valuation. In that moment, it was a total flip. It was like, we should indulge in this opportunity and think of it as something that’s part of a much bigger picture and that this valuation, when we get to where we want to go and we’re as big as we want to be, when we feel like we’re taking on this global opportunity, then this negotiation isn’t going to matter. I think this was an 11:00 pm discussion, that it really just switched everything. I think we said, yes, we did actually not agree with their valuation, but I think we were $100 million post money, which is still pretty good. For anybody who gets to $100 million valuation, I think you would feel pretty successful, but for us I think, again, thinking really big we always really believed it was just a small step towards something much larger.
My time is running out, so I’m going to speak much faster. Actually, I’m going to blame the microphone failure and take an extra minute, but one of the other things that’s important, especially at Hustle Con and with this idea of hustle, is that when you’re an entrepreneur, when you have this burning fire inside of you to accomplish something to solve a problem, you have fuel. You have something that probably is pushing you. You probably wake up in the morning feeling like you’re going to change the world, that you’re going to make an impact, that you’re going to do something that means something to the world. That can be overwhelming both for you and for the people who are around you. For us, Adam and I were both the people who had no off switch. Casey mentioned sleep, I’ve been lucky enough to not sleep much for the past 20 years. I think Adam is able to sleep intermittently, depending on what few minutes his four kids and huge business allow him to find that time to relax. What we realized early on was that this unlimited energy that we had, it was inspirational to the people who were around us.
People followed us and loved to be a part of it, but then a month, two months, three months into it they would come. Many of them would come and say, “My whole life is falling apart,” oftentimes in tears. Because I’m the west coast chill dude, they’re mostly coming to me with that conversation. I would be in this position of saying, “I’m sorry. I’m sorry this is so hard for you.” People would be saying, “I’ve sacrificed my entire life for this company. I broke up with my boyfriend or girlfriend, my relationship with my family. I haven’t seen anybody. I haven’t taken vacation. I’m overwhelmed by this.” What we realized is no matter who we are as founders, and for those of us who are true hustlers and may have that unlimited energy, the culture of the company has to be healthy. You have to start with a way to balance that. You need it as part of who you are from the beginning. You need to give people of diverse backgrounds, of diverse family situations, the opportunity to be their authentic selves in your context.
You need to figure out how to create that environment that’s going to help them be successful. It’s something you should think about from day one, what is the culture you’re trying to establish and how do you make the people on your team feel valued? Valued as whole people, as their full selves, not just for what they can contribute for business objectives? The last one and this one is, I think, simple but also important, is that when Adam and I started we had done other things. Adam had started other companies. Like I said, I started one and I was working as a designer and architect. When we started WeWork, we felt like we had an opportunity to pursue our full potential. When you’re starting your company, you can think of it as solving a problem. That’s great. If you can find a problem to solve, then maybe you can create a company and then sell it. Okay, there’s something to that, but a better aspiration for you would be create the company that best reflects who you are and what your capabilities are and what your potential is. Make it a forum for yourself to grow, and change, and evolve and learn, because who gets to create their own job?
Very few people in the world get to form their own work environment. Almost everybody works for somebody else, but if you start something you can make it the best place for you. If you think of it longterm, you can imagine your journey being for life. When we started we said, “This is a 100 year adventure.” We’re also pursuing life extension, that way we can get to the 100 years. For real, from the start we felt like it was our last job. What that did was it said this is a journey. This is not a destination. We’re not trying to raise a certain amount of money. It’s not about series A, B, C. It’s not about going public. It’s not about IPO. It’s not about exit. That’s never been part of our dialog, never.
Instead it’s been, who are we as people? What’s the path that we’re on? How are we growing and changing? How are we evolving, and how are we creating the context for us to be our best selves? Then similarly for our team members as they join us and they become a part of this, how do we make it the best place for them? For them to find their path towards self actualization? For them to become their best selves in our context? That’s truly one of the best aspirations you could have as an entrepreneur, is to create a place where people are pursuing a great future for their selves, for their families, for their being and for the world. Thank you, guys, for having me, and hopefully these five things are helpful to you. Oh, I forgot. We’re opening in Oakland. My team will kill me if I don’t say that. Coming, I think, in December. Thanks, guys.