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Startup That Turns Restaurants, Hotels Into Flexible Workspaces Raises $2.5M

WorkChew co-founders

A D.C.-based startup that turns underutilized restaurant and hotel space into flexible workspaces has raised its seed funding round. 

WorkChew announced Wednesday it raised $2.5M in a funding round to help it expand across the country. 

The seed round was led by Harlem Capital and also included participation from Wilshire Lane Partners, Invictus Advisory Group, Techstars Ventures and RW Capital Investments Inc. It also had individual investors including Kabbage co-founder Kathryn Petralia and Etsy co-founder Chris Maguire. 

The company had raised $225K from accelerators in 2019 and 2020 prior to the seed funding round, WorkChew founder and CEO Maisha Burt told Bisnow.

Founded in late 2018, WorkChew has locations in D.C., Philadelphia and Chicago. It has plans to expand this year to New York, Atlanta, Miami, San Francisco, Seattle, Los Angeles and Denver.

The company partners with restaurants and hotels to give them an extra source of revenue by turning underused spaces into on-demand workspaces for remote workers. The days and hours when the workspaces are open vary by location. For restaurants, it is typically during the workday when they are less busy, and they offer deals such as 10% off or bottomless coffee. 

WorkChew co-founder and Chief Operating Officer Allyson McDougal told Bisnow that the company had strong activity before 2020, but she said the coronavirus pandemic made restaurants and hotels even more interested in the concept as they searched for new ways to generate revenue. 

"They’re more inclined and open to learning about alternative methods that might help right now," McDougal said. "The pandemic has opened up doors for people to really understand the value of the product in a very immediate sense where it automatically clicks."

The pandemic has also changed the types of customers WorkChew has on its platform. Previously, its user base was mostly individual workers looking for remote solutions, but Burt said it has now shifted to a business-to-business model where the majority of its customers are companies buying the membership as a workplace offering for their employees. 

Burt said she sees companies becoming more interested in this offering as they shift to longer-term remote work strategies, including hybrid approaches with employees working remotely for part of the week. Employees may not be going into the office five days a week, but they may also be tired of working in their homes, she said. 

"They’re craving a change of scenery and wanting more social interaction face-to-face outside of Zoom calls," Burt said. "What we’re able to do now since you have this large group of people moving toward working from home but won't necessarily be working in their homes every day is to move those people into these hospitality spaces and help them monetize their underutilized space."

With the funding, WorkChew plans to invest in its product development and marketing team to help fuel its expansion. 

"We are growing the team and are getting to the point where we can focus on our next goals, which are to ramp up customer acquisition and build supply across the U.S.," Burt said.