Posted on 10/25/2019 7:44:33 AM PDT by C19fan
This is how the WeWork story ends—for now. The high-flying office-sharing startup, which introduced itself to the world as “a community company” with a mission to “to elevate the world’s consciousness,” is paying its founder, Adam Neumann, more than $1 billion to go away. Meanwhile, the company is so cash-poor that it cannot afford to pay the severances of the 4,000 workers it intends to cut.
WeWork’s free fall from a projected valuation of nearly $50 billion to just $5 billion will likely be taught in business school, immortalized in best-selling books, and debated among analysts for years. But one thing’s for sure: It has established Adam Neumann, who escaped from the wreckage a billionaire, as a figure of almost mythical monstrousness—like some capitalist chimera of Midas and Houdini.
(Excerpt) Read more at theatlantic.com ...
He’s probably kicking back in Israel, planning his next little project.
Nice work if you can get it. I'll go away for a lot less!
“paying its founder, Adam Neumann, more than $1 billion to go away”
I’ll do it for half that.
Wework is an old business plan that has always gone belly-up as soon as a recession hits. Companies that do a similar thing are insurance companies that have huge pools of cash which allow them to weather recessions. Often you see buildings go into bankruptcy including banks because they have no ability to manage large debts without renters. Wework has no pools of cash. They are heavily indebted. And they alone could cause a small recession if some of their larger customers fail to keep renting. Or if investors refuse to give them money.
:-)
Yours is an expensive departure! I could get by on $20,000 a year.
There have been all sorts of office sharing/leasing companies around for at least a couple decades. Regus was one a startup I was with in the dot-com era used.
I haven’t looked closely at this WeWork debacle, but WTH were they selling that made it so attractive!? This stuff isn’t rocket surgery, it’s basic corporate office real estate.
With that kind of dough, Kramerica could really hit the ground running!
Hillary will be unhappy that someone else is laying claim to her title.
He’s a piker compared to most of Congress.
Hello Neumann.
Is Masa Son really that smart?
I was going to go with Elizabeth Holmes of Theranos fame, but Neumann gets to walk away with a billion. Holmes is close to broke I believe as most of her wealth was on paper in the form of Theranos stock.
Neumann was smart enough to use his ownership to borrow hundreds of millions of dollars from his personal banker JP Morgan. Morgan found itself in the situation of when you owe a bank $10 K the bank owes you but if your owe $500 MM you own the bank.
Oy vey!
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