Artfully lit offices, fruit-infused water and Instagram-perfect wall murals have helped turn co-working space provider WeWork into a $20bn company before it has even turned a profit. The next step may be a stock market listing. But the cost of WeWork’s ambition is high. If expansion continues at the current aggressive pace, net losses will persist.

WeWork’s steep valuation depends on a blinkered faith in its originality despite a crowded market of competitors. If the company’s equity value was based on the same multiple of sales as flexible workspace peer IWG (formerly Regus) it would be worth less than $3bn.