Ex-PayPal exec says WFH isn’t a way to build a big business – and he’s not alone

The remote work trend has seen unprecedented growth in recent years. Workers appreciate the flexibility in managing their schedules and the reduced stress of travel while companies have access to a wider talent pool as they can hire people from anywhere in the world.

But former PayPal Holdings Inc. executive David Sacks is not a fan of work-from-home (WFH) policies.

“It’s time to admit remote work doesn’t work,” he said in a recent tweet. “WFH Friday is a four-day work week. The full WFH is a two-day work week.

Sacks points out that when people are out of the office, every interaction needs to be planned in advance. And that means “a lot of information sharing isn’t happening.”

“Distance is a great way of life, not a way to build a big business,” he concluded.

Sacks knows a thing or two about construction companies. He was the founding chief operating officer of PayPal. Later, he built the enterprise social networking platform Yammer, which was acquired by Microsoft Corp. in 2012 for $1.2 billion.

And he’s not the only member of the PayPal mafia — a group of former PayPal employees and founders who went on to grow other tech companies — who dislikes the concept of remote work.

“Morally wrong”

Tesla Inc. CEO Elon Musk is probably the most famous member of the PayPal mafia. Musk revolutionized the electric car industry with Tesla and made significant strides in space exploration with SpaceX.

And he’s also not sold on the concept of remote work.

“I strongly believe people are more productive when they’re in person,” he said in a recent interview with CNBC.

For Musk, the problem goes beyond productivity.

He noted that workers who make things people consume cannot work remotely. And assuming these workers have to work onsite when you don’t is “morally wrong.”

“Is it like, really, you’re going to work from home and you’re going to bring in everyone who made your car at the factory? You’re going to make the people who cook your food… Can’t work from home?” Musk said. “People who come to fix your house, they can’t work from home, but you can? Does that feel morally right to you?

Musk went so far as to say that “the laptop class lives in la la land”.

Work From Home Stocks Vs. Office REITs

The rise of remote work has brought significant changes to the investment landscape.

For example, companies providing remote work collaboration tools, cloud-based services, and digital communication platforms have seen significant growth opportunities since the onset of the COVID-19 pandemic.

There are now exchange-traded funds (ETFs) that help investors tap into the segment.

For example, the Direxion Work From Home ETF (NYSEARCA: WFH) aims to track the Solactive Remote Work Index. He owns 40 stocks, including companies that create popular solutions to enable remote work such as Microsoft Corp. (NASDAQ: MSFT), Alphabet Inc. (NASDAQ: GOOGL) and Zoom Video Communications Inc. (NASDAQ: ZM).

While remote working has presented new opportunities for some companies, it has also had a noticeable impact on commercial real estate, especially office buildings. This shift in work dynamics has prompted companies to re-evaluate their office space needs, leading to shifts in demand.

But if more executives share Sacks and Musk’s point of view and bring their employees back on site, office buildings could see better days ahead.

Investors who want to bet on a rebound in this segment can look to real estate investment trusts (REITs) that focus on office properties, such as Boston Properties Inc. (NYSE: BXP) and Alexandria Real Estate Equities Inc. ( NYSE: ARE).

If you prefer real estate segments with a little less uncertainty, you might want to look into single family rentals. After all, no matter what happens to remote work, people will always need a place to live, and a growing number of people are now renting instead of buying. These days, there are even options to invest in rental properties with as little as $100.

© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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