San Francisco CEO who's closing his $215 million company's upscale office lounge says return-to-work push is ‘fighting a losing war’

But the lounge is due to close on November 1. The point, CEO David Barrett explained in a blog post on Wednesday, was to run an experiment.

Founded 15 years ago, the $215 million market-cap Expensify, which sells an expense-reporting app, was a remote-first company well before the pandemic. It even has an offshore program, in which employees can work abroad together for a few weeks every year.

But with COVID forcing millions of people to work from home, Barrett wrote, “we recognized that we were living through a transformational time for the rest of the market, and decided to fix up one of our offices and run a little experiment around a very simple question: Can anything bring workers back to the office voluntarily?”

The answer, he concluded, was mostly no: “In practice, the lounge was a place that people would generally visit, marvel at, work for a bit, and leave.”

Based on the experiment, he believes that employees at other companies currently working in the office “are likely going because they feel pressured to (either by their boss or their peers), not because it’s actually their preferred place to be.”

RTO divides the Fortune 500

At Amazon, employees staged a walkout earlier this year over the company’s return-to-office mandate, but managers now have the green light to terminate workers who ignore it, according to guidelines seen by Insider last week. Nike, meanwhile, recently updated its return-to-office policy from three days to four.

But while the return-to-office trend has been gaining steam, some companies are ignoring it. Nvidia,  a $1 trillion AI powerhouse, offers luxurious office spaces, but it still lets employees decide whether to use them. Canva, the graphic design startup valued at $26 billion last year, has taken a similar approach.

In a recent survey of over 8,400 U.S. workers by FlexJobs, 63% of respondents said remote work was still the most important part of a job to them, ahead of salary and a good boss.

‘We’re just never going back’

Barrett believes there’s still a place for offices, but as a society “we’re just never going back to a regular nine-to-five office culture, a staple of not just our modern culture, but also the foundation of most urban planning.”

In New York City, Mayor Eric Adams announced a plan in August to convert empty office buildings into housing. “COVID taught us something,” he said. “If we want to acknowledge it or not, we are in a different norm. Everything has changed, and we have to be willing to change with it.” 

Companies now insisting that employees return to the office might want to reconsider, Barrett suggested: “If the best office in the entire planet can’t compete with the local coffee shop, the tightly closed Pandora’s box of ‘work from anywhere’ has burst open, and will never be resealed. No amount of begging or coercion is going to work in the long run: The businesses that demand it are fighting a losing war of attrition against an infinite universal energy.”

But he noted that Expensify did derive a few other benefits from the lounge experiment, such as using it as a laboratory to test new products and impressing possible clients.

As Barrett wrote, “It was an incredible brand experience: Despite how lavish it seemed, from a cost perspective it was orders of magnitude cheaper to fix someone a cocktail in our own bar than to try to talk to that same potential customer at a conference booth.”