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Some WeWork Board Members Seek to Remove Adam Neumann as CEO

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Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#111

Post by cdolan »

stagger87 wrote: post #77
iamleppert wrote: post #40

What kind of company that is controlled by a single man insists on branding itself as “we”? Even the name of the company is a bold-faced lie.

Is your argument that companies that use plural pronouns in their name should have certain types of ownership structures?

First rule of getting out of a hole is to stop digging.

Honestly how did you make this logical jump? It’s pretty obvious to me the parent post was pointing out that there is a lot of irony in a company, completely controlled by one individual (or his wife if he dies), is named “We”.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#112

Post by mbell »

rossdavidh wrote: post #86
notyourday wrote: post #74

Earlier quoted context omitted.

> Preferred shares existed before Facebook, and it may not the be norm, but there's a reason we no longer see the hostile takeovers from the 80's. That has nothing to do with preferred shares. Most of public companies adopted poison pills aka shareholder right protection plans which work along the lines of this: 1. If someone acquires a certain percentage of company shares without board of directors agreeing to it, t…

While there are issues with Zuckerberg, I think it bears noting that the FB IPO wasn't done because he needed the money, but rather because they were forced too by law because too many people had ownership. So, he didn't give great terms in the IPO because he didn't really need any cash; FB was already cashflow-positive. This is a marked contrast to WeWork.

> While there are issues with Zuckerberg, I think it bears noting that the FB IPO wasn't done because he needed the money, but rather because they were forced too by law because too many people had ownership.

This isn't entirely true. Once a company passes the shareholder limit they are required to publish public financials similar to what a publicly traded company must provide. However they are not required to sell their stock on the open market, it's just that it's such a small step at this point that most if not all do.

Also - while this is often quoted as the reason for Facebook's IPO, it's worth noting that the investor limit was actually raised (from 500 to 2000) a couple months before Facebook's IPO. If it were really the main reason they could have easily held off on the IPO and carried on as a private company.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#113

Post by jnwatson »

hef19898 wrote: post #64
MobileVet wrote: post #23

With $700M extracted and long term leases to the company for properties that he owns... One could easily ride off into the sunset. It will be interesting, and insightful, to see if that is the tact he takes. If he does... It will add credibility to the already strong case for this being deliberate deceit versus unchecked ignorant hubris.

I'm not sure if any other employee in any other company could get away with something like that. Sounds like a clear conflict of interest to me. Same goes for some of Elon's and Tesla's business transactions, so. Sounds like an overall bad idea to me, just how SoftBank accepted any of it is beyond my imagination. I'm all for letting founders cash out to a certain degree before an IPO, but 700M and the lease agreement…

Eddie Lampert, former CEO if Sears, seems to have gotten away with it.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#114

Post by DebtDeflation »

greenyoda wrote: post #32
exogeny wrote: post #19

Considering he has the votes to fire the entire board, I'd be shocked if this happens. Softbank is completely fucked.

If he fires the whole board, wouldn't that add further doubt about the company's governance and reduce the expected value of any future IPO even further? It doesn't seem like that would be in his best interest.

>If he fires the whole board

It's game over at that point. Kiss the IPO goodbye, kiss the $6B in lines of credit goodbye, kiss any further investment from Softbank goodbye. With their burn rate, they then have MAYBE another 6 months before they become insolvent. That having been said, it would be quite the Pyrrhic Victory for Softbank, might even mean their demise as well.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#115

Post by tyri_kai_psomi »

willwagner wrote: post #33
tyri_kai_psomi wrote: post #24

Earlier quoted context omitted.

What I don't understand is what is so mind boggling to GP? This is the norm for the vast majority of private companies.

I think if you are including coffee shops, dry cleaners, and the rest of small businesses that are self-funded, I agree. If you look at VC backed high tech startups, I don't think that is the norm: https://www.capshare.com/blog/4-key-insights-from-5000-cap-t...

What about non-vc backed high tech startups, which are the by far the majority of tech jobs? (my company, fwiw) We have investors sure, but the two founders retain the control. All of the companies we have acquired were in similar situations. In fact it is precisely not until you get to VC-backed startups where this becomes surprising, such as in the GP comment I was referring to.

If you actually make money, have positive cash flow, and have a sustainable business model, you don't have to give up control. The investors will come to you -- foreign concept to the SV-SF "high tech" bubble, I know.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#116

Post by some1else »

stagger87 wrote: post #77
iamleppert wrote: post #40

What kind of company that is controlled by a single man insists on branding itself as “we”? Even the name of the company is a bold-faced lie.

Is your argument that companies that use plural pronouns in their name should have certain types of ownership structures?

I think his argument was that if a company uses the name "We", it should have a certain type of ownership structure. The interpretation could probably be further extended to other names that signify plural governance. That sounds reasonable to me. I can't infer ownership implied by all plural pronouns though, so I suspect your interpretation is probably too general.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#117

Post by nknealk »

jayess wrote: post #71
racecar789 wrote: post #54

I wish a company going public could only release one class of shares. One vote per share.

It doesn't appear this company will go public anytime soon, if ever. I give it 90 days before it collapses.

It has enough cash in the bank already to survive well past 90 days, even at it’s current burn rate

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#118

Post by tempsy »

jakelazaroff wrote: post #101
mpalmer wrote: post #84

Earlier quoted context omitted.

> Yeah, but all that would have been fine if he’d acted responsibly. > if he’d acted responsibly > if The "if" is the point. SoftBank had the ability to eliminate the risk of this "if", and didn't.

So what you’re saying is: if someone doesn’t prevent you from doing something, they should shoulder more of the blame than you do for actually doing the thing?

Take an extreme example. If a VC decided to invest $1b in a lemonade stand run by a 7 year old and the whole thing falls apart, then yes I would blame the VC for not conducting proper due diligence and enabling someone who neither had the right business for $1b or was the right leader to execute on that business in the first place.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#119

Post by notyourday »

rossdavidh wrote: post #86
notyourday wrote: post #74

Earlier quoted context omitted.

> Preferred shares existed before Facebook, and it may not the be norm, but there's a reason we no longer see the hostile takeovers from the 80's. That has nothing to do with preferred shares. Most of public companies adopted poison pills aka shareholder right protection plans which work along the lines of this: 1. If someone acquires a certain percentage of company shares without board of directors agreeing to it, t…

While there are issues with Zuckerberg, I think it bears noting that the FB IPO wasn't done because he needed the money, but rather because they were forced too by law because too many people had ownership. So, he didn't give great terms in the IPO because he didn't really need any cash; FB was already cashflow-positive. This is a marked contrast to WeWork.

It is a bit more complicated than that - FB investors used SPEs rather than held the shares directly. When the number of SPEs got too high those SPEs themselves reorganized moving the investors more levels down.

Re: Some WeWork Board Members Seek to Remove Adam Neumann as CEO

#120

Post by marcinzm »

hbbio wrote: post #100
thedogeye wrote: post #53

WeWork is a useful product. Office real estate is broken for startups. Landlords make us take 5-10 year leases when startup planning horizons are almost never longer than 18 months. WeWork earning 30-40% margins by allowing us to take shorter terms that better fit our needs. Should be a good business.

There is clearly a market for WeWork... and many competitors. WeWork is and will be a great company, no matter what. WeWork main competitor is Regus, founded in 1989. Regus is now present worldwide with revenues of 2.535 billion GBP (2018). Their market cap is a mere 3.68 billion! There are also tons of smaller companies in that sector which are not international (mostly 1/2 countries) with much lower valuations. So,…

>WeWork is and will be a great company, no matter what.

That depends on their financial state. If they over expanded with the expectation of future capital to cover future contractual costs then they'll need to find a way to cover those costs without funding. That could be impossible without declaring bankruptcy.

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