Kevin O’Leary told CNBC on Friday the coronavirus crisis has shown that remote working is good for employees and a business’s bottom line.
“Productivity is significantly higher when you give people what they want,” the “Shark Tank” investor said on “Squawk Box.” “Maybe they’re taking care of an aged parent, maybe they’re raising kids, maybe they don’t want to commute. Whatever reason it is, the productivity has gone up.”
O’Leary, chairman of O’Shares ETFs, said across his business portfolio he anticipates granting about 20% of employees the right to work from home “perpetually.” He singled out areas such as compliance, accounting and logistics. He said the company will help employees upgrade their home internet and technology to help in the transition.
A significant shift to work from home will hurt commercial landlords, O’Leary acknowledged, but he said it is beneficial for his companies’ finances as it seeks to reduce its office footprint.
“We’re going to save a ton of money,” said O’Leary, known as “Mr. Wonderful” on “Shark Tank.” “Don’t know this yet, but I think we can save about 5 to 7% free cash flow across the portfolio. I’m really excited about the new America we’re going to have.”
The pandemic ushered in a dramatic new landscape for corporate America as businesses of all sizes adopted work-from-home policies in March to try and slow the spread of Covid-19. It remains to be seen how long crisis-driven changes will last.
Twitter and Square, both led by Jack Dorsey, have already said most employees can work from home permanently, while Facebook CEO Mark Zuckerberg recently predicted as much as 50% of the company’s employees could be working remotely in the next five to 10 years.
By contrast, Owen Thomas, CEO of commercial landlord Boston Properties, told CNBC last week that companies value having a physical office. He pointed to recent efforts by businesses to establish satellite offices in suburban settings instead of requiring large portions of their workforce to commute to a downtown location.
O’Leary said he entered the pandemic skeptical of the benefits of working from home. But now it’s been happening for months and some businesses have navigated it “very successfully,” he said.
He said he believes optimism in financial markets is due, in part, to investors realizing the post-pandemic world will be more efficient.
“We were forced to test this. We had no other choice. Now, I really want 20% to stay at home because I really, really think it’s more efficient and it saves a lot of money,” he said. “I think I’m going to make more money form my companies in the years ahead, and I think the market senses that, not just for small businesses, for all businesses.”
Disclosure: CNBC owns the exclusive off-network cable rights to ″Shark Tank,” on which Kevin O’Leary is a co-host.