WeWork's competitors are scrambling to distance themselves from the co-working giant, but many are following the same script

Jamie Hodari heads Industrious, which raised $80 million early this year. He's confident that real estate industry projections about the inevitable growth of flexible working arrangements are right, and that we are witnessing the beginning of a shift towards more amenitized workspaces.

But with the industry still so far from where Hodari and others believe it will be, he doesn't see WeWork's challenges as helpful for his company's growth.

"I think we're rooting for them," Hodari said last Wednesday. "I don't think we have any stake in competitors stumbling — it's just not that kind of industry." 

Still, Hodari says that this moment of uncertainty could actually boost the fortunes of other coworking companies by allowing them to compare their business model to WeWork's.

"It is forcing people across the real estate industry and investment industry to develop a point of view," Hodari said. "That's an exciting development."  

Indeed, Hodari was quick to point to how Industrious is different from WeWork, calling WeWork's approach an "asset-heavy, grow-at-all cost strategy." WeWork, like some of its smaller competitors, has been trying to do more business by partnering with landlords and enterprise companies instead of signing traditional leases. 

Bryan Murphy, unlike the other CEOs that Business Insider spoke with, didn't start the company he now leads. Murphy has previously worked in software, e-commerce, healthcare, and advertising.

While Murphy does have concerns that the media and general public may have a hard time distinguishing between WeWork and its competitors, he said that he is confident that real estate decision-makers can easily tell the difference. 

"This is about the fourth vertical that I've been a part of disrupting," Murphy said this Monday. "I can tell when we're at that genie out of the bottle phase. We're in that phase. And it's not going back." 

Breather, which offers on-demand flexible space and a white-label product to landlords who want their own brand on a coworking space, has emphasized partnering with landlords.

Murphy said that landlords and investors both are now more interested in sustainable growth, compared to the rapid growth of WeWork. 

"For a very long time there was a thesis in the Valley that winner takes all, at any cost," Murphy said.

"I think we're coming back around to the notion that maybe that's not the solution now," he said.

Amol Sarva expressed concerns about a possible chilling effect on the flexible office space industry when he spoke with Business Insider last week.

"It's hard when you have to walk over a fallen giant," he said.

He said that while the "froth of the news cycle" has brought a lot of attention to the space, the underlying themes haven't changed.

Still, he highlighted the difference between coworking, where different companies share a communal space, and flexible offices, where an operator provides shorter lease terms, a dedicated space for a company, and more amenities than a traditional landlord. 

Coworking is "over," according to Sarva.  

"We're almost at the point where people say 'flex,'" he said.

Knotel raised $400 million last month in a fundraising led by Wafra, the investment arm of Kuwait, as well as Japan's Mori Trust, Itochu Corp. and Mercuria Investment Co. It's now valued at more than $1 billion, according to the company. 

WeWork, the first company in this wave of branded, flexible office space operators to concretely move towards an IPO, is the first example of what it looks like when the space hits the public market.

Ryan Simonetti expressed concern that the "negative press cycle" around WeWork could taint the flex office and coworking space when he spoke to Business Insider two weeks ago. 

"To me, that would be like going back and questioning the thesis that led to the existing hotel industry, the thesis that led to Airbnb or ride-sharing or to cloud or data centers," Simonetti said.

While he understands that people may have their doubts on the industry after seeing WeWork's S-1 filing, he said that it would be a mistake to conflate WeWork's business with the competitors. 

"Bill Clinton has a great quote that says, 'Don't focus on the headline, focus on the trend line,'" he said. 

WeWork's challenges may actually be a positive for the industry, he said, as it can allow competitors to highlight how they are different. 

"I think all of us are now strategically seeing that and then saying, for us and our core customers — what's the best way for us to build a business?" 

Simonetti doesn't think of Convene as a tech company. WeWork's prospectus, in contrast, highlighted the notion of the company as a coworking platform. 

"Are we a technology company? No. Are we a deeply technology enabled business? Yes," he said.