WeWork

» see wework.com as it lived, on the wayback machine

~ the last words ~

wework was a coworking company that for nine years was somehow valued like a software company. adam neumann and miguel mckelvey opened the first location on grand street in manhattan in 2010. you rented a desk by the month. you got coffee and a wifi password, and a community team invited you to events. the rest was just commercial real estate dressed up in a logo.

the trick was the pitch. neumann sold wework as a "physical social network" that would "elevate the world's consciousness". softbank's masayoshi son put around 18 billion dollars into the company across multiple rounds. by january 2019 the private valuation hit 47 billion. wework had over 500 locations in 111 cities and around 12 thousand employees. for a brief moment it looked less like a landlord and more like a platform.

the s-1 filing in august 2019 ended that. analysts read it. it was the prospectus of a company losing about 219 thousand dollars an hour. governance was a mess. neumann owned trademarks the company had to license back from him, and he held super-voting shares that put him above any board pushback. the ipo was pulled within six weeks. neumann walked away with a roughly 1.7 billion dollar exit. softbank wrote the valuation down to about 8 billion.

wework was never my orbit. i build computer vision for drones in ankara. the wework universe was vc-funded sf startups doing pitch decks in glass conference rooms with free kombucha. wework opened a few istanbul locations around 2018, but the closest i ever got was reading the s-1 takedowns on hacker news in late 2019 and watching wecrashed three years later for the cinematic version of the same story.

~ the record ~

~ how it landed ~

the core product was real estate arbitrage. wework signed long-term leases on commercial floors, broke them into small private offices and hot desks, then rented those out short-term. when occupancy was high and rents on the building side were locked low, the math worked. the model assumed you could always backfill empty desks.

covid broke that assumption. occupancy collapsed in 2020 while wework's long leases stayed. the company finally went public in october 2021 through a spac at a 9 billion dollar valuation, less than a fifth of the 2019 peak. it never returned to growth.

~ the chapter 11 ~

wework filed for chapter 11 in the southern district of new york on november 6 2023. by then the stock had been trading under a dollar for months. the filing covered about 18 billion dollars in long-term lease liabilities. wework used the process to terminate around 70 leases in the first month and renegotiate dozens more.

by june 2024 it emerged from bankruptcy under new ownership controlled by yardi systems and softbank, with around 600 million dollars of new financing and most of the old equity wiped out. the surviving entity kept the brand. softbank's roughly 18 billion of investment was effectively zero.

~ the long tail ~

adam neumann is now running flow, a residential real estate startup that took a 350 million dollar check from a16z in 2022 before it had a product. masayoshi son moved on to ai. wecrashed got a hulu series and a podcast. the s-1 became a teaching artifact in graduate finance classes about what governance fraud looks like when nobody has yet called it that.

wework itself still has locations. you can rent a desk in istanbul or london. the brand survived. the 47 billion dollar story did not.

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