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  • I think when you cover IPOs and high-flying startups

  • you're used to seeing dramatic changes

  • over short periods of time.

  • But nothing in my experience has really compared

  • to what WeWork has undergone.

  • I think people felt like they blinked,

  • and everything was different.

  • At last reporting,

  • they're running out of cash very quickly here.

  • Sources have told Bloomberg

  • that the company could run out of cash by next month.

  • I was surprised at the vitriol and the speed

  • with which investors apparently rejected

  • what WeWork was trying to do.

  • From the first day that we started WeWork

  • it was about bringing people together.

  • There's an energy that you feel,

  • that energy is something that's hard to explain,

  • it's something that either you feel it or you don't.

  • We like to call it the We Generation.

  • In less than one year, WeWork went from

  • one of the most highly valued startups of all time

  • to losing more than 3/4 of its value.

  • Ousting its rockstar CEO,

  • and desperately needing a cash bailout

  • from its biggest investor just to keep the lights on.

  • In order to understand how we got here,

  • we need to take a look

  • into the mistakes made along the way.

  • The ambitious vision of WeWork

  • is effectively dead, period.

  • This is a case study

  • of when a company got too much money too fast

  • with no effective oversight on how to spend it.

  • They are no longer the market leader,

  • that company's gonna get smaller,

  • and it's never gonna be 10 times bigger,

  • I mean, the story is over.

  • As late as summer 2019,

  • the co-working company WeWork

  • was considered one of the most valuable startups

  • with a $47 billion price tag,

  • more than Airbnb, Stripe, and SpaceX.

  • But in just a few months time that valuation has vanished,

  • and the very future of the company is in doubt.

  • To understand how this happened, it all starts

  • with the company's now former CEO and founder, Adam Neumann.

  • Adam Neumann is the co-founder of WeWork,

  • and was its CEO for a long time.

  • He came over to New York for college

  • after being in the Israeli Navy.

  • And started a few businesses, including,

  • my favorite example is a baby clothes line with knee pads.

  • His landlord was actually showing him

  • another building in Brooklyn,

  • when he came up with the idea

  • of sort of subdividing that space,

  • which Miguel McKelvey, his co-founder,

  • who's a trained architect, sort of came up with the plans,

  • and then boom, they were away.

  • They started a company called Greendesk which they sold,

  • and that was the first iteration of WeWork

  • which they started in 2010.

  • WeWork is a new environment for the workspace.

  • So co-working was sort of where it started.

  • Today, there's a movement in changing the way people work.

  • 2010 was a great time

  • to be starting a co-working company in New York City.

  • There were a bunch of landlords

  • with empty office buildings, vacancies,

  • WeWork actually presented a solution for them.

  • The very first building down in Grand Street

  • in Downtown Manhattan was where WeWork

  • launched its first co-working spot,

  • and from there it was sort of boom.

  • From 2010 to 2011, it doubled in size.

  • And from then on the growth was exponential.

  • Some of their original investors

  • were people who were involved in commercial real estate.

  • They got some early investment

  • from a venture capital firm called Benchmark,

  • and eventually sort of kept growing,

  • kept taking on new leases and started to grow the business

  • starting in New York City.

  • Business grew quickly and by 2015,

  • the company already quadrupled its valuation

  • to $10 billion, counting 23,000 customers,

  • paying memberships in 32 locations,

  • renting desks for as little as $45 per month.

  • WeWork's whole idea was,

  • let's not just be a commercial office leasing company,

  • let us accelerate the new world

  • of how people work and make it better.

  • Community, being surrounded

  • by a group of like-minded individuals,

  • being part of something bigger than yourself

  • inspires people to work harder, spend more time at work,

  • and just have fun doing it.

  • And initially, this attracted the attention

  • of young entrepreneurs looking to expand their companies.

  • We thought it's about time

  • to give you a tour of where WeWork.

  • A tour of where WeWork, a tour of where WeWork .

  • You got your cokes, you got your Red Bulls.

  • Incredible group of people, everyone that I've met

  • through the WeWork community's been absolutely awesome,

  • and all the staff here are incredible.

  • It's almost like a cult-like sensation

  • that they created with the very early employees,

  • sort of realizing that WeWork was more than a company.

  • It was a bit of a family, it was a community,

  • and the members too sort of realized that,

  • they realized they could lean on each other

  • in terms of networking,

  • in terms of growing their own businesses.

  • This excitement drew in

  • even more investors to the company.

  • Adams and his company, it's not 2.0 it's 10.0.

  • I mean, he's taken it to really the next level.

  • And when you walk into their space,

  • and you see the energy, you see the excitement,

  • you see the interaction.

  • It's a very, very powerful concept.

  • And the most crucial investor

  • would be SoftBank.

  • I would say the time

  • that I think WeWork really started to take off

  • was when SoftBank invested in them in 2017,

  • that gave them a valuation of $20 billion.

  • And that's really when you start to get into the high ranks

  • of other venture-backed private companies.

  • With SoftBank's investment,

  • WeWork quickly expanded its footprint throughout the world.

  • And it's the beginning also of this partnership

  • between Adam Neumann and Masayoshi Son,

  • who's the head of SoftBank.

  • They have this meeting that is often told again and again

  • in the lore of WeWork,

  • where Adam made this pitch, and Masa said,

  • "That's great, but let's make it even bigger."

  • WeWork is actually one of over 80 companies

  • that SoftBank Vision Fund has backed

  • with its over $100 billion.

  • SoftBank's idea is, there's lots of money out there

  • in this unique period of transformation,

  • let's make everything happen faster with more money.

  • And let's enable companies that have smart ideas

  • to get even more ambitious, bigger, and faster.

  • Between 2017 and 2018,

  • SoftBank would invest around $8 billion into WeWork,

  • doubling its valuation to 20 billion in 2017.

  • In 2019, SoftBank floated

  • a potential $16 billion investment,

  • which would give them a controlling stake in the company.

  • Ultimately, they would scale back to just $2 billion,

  • but it was enough to double

  • WeWork's valuation again to 47 billion.

  • So at 47 billion, which is a little bit

  • of an illusory number, it's not real.

  • But that put WeWork in the very top tier

  • of high valued young startups.

  • So the reaction from a lot of the real estate world

  • was, "Wow, that's crazy."

  • In part because there's a company

  • that trades in the UK, called IWG,

  • used to be known as Regus.

  • It trades at a fraction of that

  • and people were looking at that company,

  • which is profitable, and WeWork which is not,

  • and wondering what the geek is,

  • why people didn't understand

  • what SoftBank maybe knew that they didn't.

  • And that's because in many measurable areas

  • like global square footage, members, locations,

  • countries, revenue, and profit

  • IWG is either similar or much higher than WeWork,

  • except, of course, for one area, valuation

  • Where WeWork was valued nearly 13 times higher than IWG.

  • We, of course, looked at that every single day and said,

  • "What are we missing?

  • "Is there something that we're not doing?

  • "Is there something in that we're missing?

  • "Is there an ingredient, that sort of there

  • "that we are missing out on

  • "that we can add into what we're doing?

  • But we never found it.

  • After getting these investments from SoftBank

  • and license to spend quickly,

  • that's just what WeWork did.

  • Opening more and more offices around the world

  • making investments in a variety of different companies,

  • and even opening an elementary school in New York City.

  • It's almost stuff of legend right now,

  • how recklessly WeWork spend its money

  • on things from a company that makes wave pools,

  • to a company that makes super foods,

  • led by a guy that Adam met while he was surfing.

  • When you see a startup,

  • that's in the commercial real estate sector,

  • investing in an indoor wave pool company,

  • and in a children's school,

  • you know something has gone wrong.

  • But just how wrong wouldn't be fully realized

  • until WeWork announced in August of 2019,

  • that it would file for a public offering.

  • It was the first time since a bond offering last year

  • that investors were able to peel back the curtain,

  • and see into the company's financial performance,

  • read its metrics, see its growth.

  • And I got up really early,

  • and I was reading it,

  • and I remember on my way into the office,

  • and it was still dark outside,

  • and there was a small line, and just a couple of lines

  • about how Adam Neumann, the CEO,

  • he had personally purchased the trademark to the word, We.

  • And had sold that back to his own company for $5.9 million.

  • And I looked at that, and I thought, "That's kind of weird."

  • This was just one of many examples

  • of how the corporate leadership, including Adam Neumann,

  • seemed to find opportunities to enrich themselves

  • at the expense of shareholders

  • and at the expense of the company.

  • The filings also showed

  • in just the first six months of 2019,

  • WeWork last $690 million,

  • bringing its total losses to almost $3 billion

  • in the past three years.

  • Things start changing rapidly.

  • Investors are telling WeWork and it's bankers,

  • "You know what, this isn't for us."

  • People are throwing out numbers as low as 12,

  • potentially even as low as 10 billion.

  • And all these things that raised a few red flags,

  • just started, it kind of added fuel to the fire

  • of this discussion of is this company ready to go public,

  • it just doesn't feel like it has the controls in place

  • that you would expect of a public company

  • that needs to protect the value for shareholders.

  • On September 17th,

  • WeWork officially pushed back

  • it's much awaited Initial Public Offering.

  • We have decided to postpone our IPO

  • to focus on our core business,

  • the fundamentals of which remain strong.

  • The board, and in particular SoftBank

  • its biggest investor, decide that

  • there needs to be a big change

  • it needs to come from the top,

  • and that Adam is now more of a liability

  • toward the company than he is an asset.

  • on September the 24th, he resigned saying,

  • "Too much focus has been placed on me."

  • He realized he was a distraction to the company,

  • in a vote with all board directors of which he was one,

  • he actually voted against himself remaining as CEO.

  • Two senior WeWork executives,

  • Sebastian Gunningham and Artie Minson

  • were appointed as co-CEOs.

  • Among their housekeeping items,

  • sell Neumann's $60 million private jet,

  • put multiple WeWork acquisitions up for sale,

  • postpone the IPO indefinitely.

  • Close down WeGrow, the company's private elementary school,

  • and layoff thousands of employees.

  • We reported that the co-CEOs

  • Artie Minson and Sebastian Gunningham

  • have secured themselves

  • multimillion dollar severance packages at a time

  • when the company doesn't even have enough cash

  • to pay severance to its thousands

  • of rank-and-file employees that it plans to lay off.

  • Have you ever heard

  • of anything like that before?

  • A company not being able to afford to fire their employees?

  • I haven't.

  • Interesting.

  • Have you?

  • SoftBank would ultimately bail WeWork out,

  • injecting a much needed 9.5 billion into the company,

  • which now is valued at less than $8 billion.

  • Now that SoftBank has bailed out WeWork,

  • I think the overarching sense is one of uncertainty

  • for everyone who's involved in this company.

  • When I've talked to ex-employees from WeWork,

  • they often feel pretty drained by the experience,

  • they felt like they came in drinking the Kool-Aid

  • thinking WeWork was gonna change the world,

  • and make everyone more connected,

  • and help people do what they love.

  • And by the time they left, they felt like

  • they hadn't really been valued,

  • and that the company was kind of all over place,

  • and they felt worn out.

  • There are some cautionary notes

  • for every other young company.

  • The running the business

  • in a completely unprofitable manner.

  • The lack of board oversight,

  • that there was no adults in the room saying no.

  • And so I think what happened at WeWork is a sign

  • that you can only run a company

  • without guardrails for so long.

  • I mean, I think it's basically a shocker for everyone.

  • I don't think anyone's seen anything quite this big,

  • and this strange go down.

  • But for those of us in tech, there is great precedent

  • for a transformational change getting underway,

  • and then a bunch of the early folks sort of flopping.

  • I mean, there was a time that eBay

  • was 10 times bigger than Amazon,

  • now Amazon's 50 times bigger than eBay.

  • There was a time that MySpace was the only social network,

  • now the only one is Facebook.

  • Those kind of reversals happen quite regularly,

  • and so it's not really a surprise

  • that the first mouse to chase the cheese

  • is the one that got caught in the trap.

  • I think that's roughly what happened at WeWork.

  • I think WeWork is sort of both, a little bit of an outlier

  • in this era of technology startups,

  • but also kind of the perfect encapsulation

  • of what this era of sort of easy money and no rules,

  • has delivered in startup land.

I think when you cover IPOs and high-flying startups

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B1 中級 美國腔

WeWork的壯觀興衰 (The Spectacular Rise and Fall of WeWork)

  • 37 1
    Amy.Lin 發佈於 2021 年 01 月 14 日
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