This is literally some of the most expensive real estate in the city, and office space in central Tokyo is not cheap. I'm amazed that they can find enough tenants to sublet this at a profit.
That said, WeWork does have a Japan-only advantage here, because startups generally find extremely hard to lease office space there: even if they can find a landlord willing to take a punt, they are often required to pay one to two years' rental as deposit.  This won't help them scale outside Japan though.
I'm sure some of the hustle and bustle is due to the novelty, much like how WeWork was when it first launched in the US. However, you're right that there is a real lack of flexible month-to-month space in Japan so that may be a lasting advantage.
But anyway, maybe I haven't seen the cheaper Tokyo co-work spaces. If you have some convenient points, I would appreciate a pointer!
Edit: I'm actually in Shibuya every few months. When I'm there I work in the Shizutetsu bus station. If you see a middle aged white guy there programming, come say hi ;-)
I don't remember the specifics off the top of my head, but I'm sure there are/have been ~300 yen/h ones in for example Shibuya.
There's a smaller one called Open Source Cafe that lies a 5~10 min walk from Shimokitazawa station - that it's off makes it quiet and nice, and they host meetups from time to time.
The market rate for a fixed-desk designated membership seems to lie around 40,000 JPY / month in the hotter areas like Shibuya and Shinjuku, which is ~20$ per day if you only go there for weekdays. I think that's quite reasonable. I think WeWork has been part of driving this change, but it's definitely overpriced as things are now.
He was charmed - it worked on Benchmark as well but at least they didn't bet the farm in followon
So maybe it's for small groups? But if there's only 2-6 of you, you could go to the literally hundreds of coworking spaces in Tokyo for 20% of the price of a WeWork hot desk. And use the savings to pay for beer.
The only big-ish group I've heard that used WeWork in its initial growth is PayPay which.... is a joint venture between Yahoo Japan and PayTM.
It feels like they're running on some culture thing, but there's basically no math that makes WeWork a valuable choice. At their price points, it starts getting cheaper to just hire someone full time to manage your office space. And if you have that kind of money you can make the deposit.
Startups or anyone in need of office space on a budget just isn't able to afford a proper office, especially if you're looking for something short-term, or unable to commit to 1-2 years.