I guess I can't blame him for trying (okay, I can and do), but it is a very brazen example of self-dealing. I'd really like to collect my normal compensation at the same time that I use company resources to outsource my work to... myself... and pocket that as well.
WeWork CEO gives back $5.9M from 'We' trademark after criticism
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Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#42It's less about the actual transaction and more about the structure that permitted it and the capricious willingness to do it. There are red flags all over the place with this company, and the optics of him doing that just adds more fuel to the raging inferno of terrible governance.
I'm just kidding guys. I was just testing to see if you really cared about corporate governance. You passed the test! Now look at the top line and my super special non-GAAP sauce! Now with 100% less GAAP!
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#43What are the types of investors that will invest in WeWork after IPO? I can see that even on regular investment forums they think it’s a joke... Will it be daytraders? Index funds? Or just “suckers” that have a fear of missing out? I’m not trolling, I really try to understand what reasoning those people have.
Seems to me if someone is shorting We because they really expect a drop following this and just want in on the action to scalp what they can, are they really a sucker? Scalpers gonna scalp.
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#44Earlier quoted context omitted.
A true genius would increase his net worth by building a successful business. If you're not clever enough to do that though, there's always self-dealing.
It's not clear that it's possible to build a successful, long-term business by shouldering all the long-term risks of owning office space, and leasing it out at short-term rates to startups. In that situation, the smartest move is to plunder your investors and shareholders for everything they are worth.
I think that line of reasoning might take us to a realm where plundering is always the smart option, offering certainty where the alternative is risky.
It is not completely legal though. Someone like a CEO has a fiduciary responsibility to act in the best interests of the company. "Breach of Fiduciary Duty" is a real thing, and opens you up to liability for actual loses as well as punitive damages. So while I understand why the CEO would do this, it's probably a good idea to step back from that activity, especially on the verge of an IPO where the investor market might take a hard pass at a company whose CEO appeared ready to strip the enterprise for parts and abscond with the proceeds.
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#45Earlier quoted context omitted.
> the smartest move interesting definition of "smart" you're using
"smart" =/= "moral" in all instances. "Smart Decisions" are especially subjective.
Sure, but in this case "smart" may also != "legal". Breach of fiduciary duty would seem to come into play, especially after an IPO when activist shareholders may rise up and make a stink about it.
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#46Earlier quoted context omitted.
Being honest doesn’t garner press coverage. Ever hear of troubles at Twilio, PagerDuty, etc? I have not (disclaimer: no investment in either, happy customer of both).
Why would you need to disclaim that you are not an investor?
Transparency and disclosure of any bias is important.
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#47What are the types of investors that will invest in WeWork after IPO? I can see that even on regular investment forums they think it’s a joke... Will it be daytraders? Index funds? Or just “suckers” that have a fear of missing out? I’m not trolling, I really try to understand what reasoning those people have.
Most index funds won't buy because they aren't in the relevant index. Something like Vanguard's total market index fund would be an exception, since they buy everything. But it's market weighted, so maybe not that much?
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#48Earlier quoted context omitted.
A true genius would increase his net worth by building a successful business. If you're not clever enough to do that though, there's always self-dealing.
He is building a successful business, it's just that that business isn't necessarily WeWork. I don't hold their stock, I'm not one of their VCs, what he and WeWork do is not my business, I have no quarrel with it.
Precisely, the successful business may be him acting as vendor to which WeWork outsources various things. So he's the CEO, and uses company resources to outsource some of his responsibilities. It's just that he's also the person that is receiving those outsourced responsibilities. I'd like to try that myself-- "Hey boss, I can't do all of this work. I think we should outsource it, and I know just the person for the job, he's already familiar with the work, has free time, and is standing right in front of you!"
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#49If you want to expand this greed-driven view to how absolutely whacky and double dealing this IPO is going to be add in the following:
1) If WeWork does NOT raise at least $3billion in this IPO they will be in default of a contingency with lenders that will WITHHOLD a committed $6billion credit line. (a)
2) This at first glance sounds sage, keeps the bankers honest in pushing the IPO right? When in fact the lending bankers ALONE will split a 3% up front loan fee - $180,000,000 - if their buddies down the hall can sell $3b of stock to bag holders in the IPO.
3) If you're lending $6b to a property landlord you'd want some strong guarantees right and again ensure the banks customers are being prioritized? Of course not - these WeWork loans will be "secured against cash and leases" NOT real property.
So the bankers, many of whom are involved in both the IPO and the unsecuritized loan, will FEAST on short term fees but of course believe in the long term viability of the business right?
This should all end well.
(a) https://www.bloomberg.com/news/articles/2019-08-01/wework-se...
Re: WeWork CEO gives back $5.9M from 'We' trademark after criticism
#50Buffet's investment thesis strongly suggests staying away from companies with bad management teams. CEO seems like a self-dealer. I am going to stay away from this Stock.