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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

#231

Post by kunday »

goatinaboat wrote: post #223
DebtDeflation wrote: post #140

Earlier quoted context omitted.

> SoftBank in particular gave $10+ billion This is the fundamental conundrum. Softbank has invested a total of $10.65B for a 29% stake in a company that (if valued like the commercial real estate firm it actually is instead of the tech unicorn that it isn't) is probably worth $5-6B if we're being generous. Further complicating matters, We is posting losses and burning cash at an incredible rate and will need addition…

WeWorks next finance round was supposed to be $4Bn IPO money + $6Bn loans contingent on the IPO succeeding. Another SoftBank-sized mountain of cash, which is now looks unlikely they’ll get. It’s interesting that it’s the same amount. Maybe this was SoftBank’s planned exit?

Even if someone were to invest in we work they will expect bargain price, given things considering.

I think SoftBank is probably pushing things further enough until they raise money for their next vision fund.

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

#232

Post by LatteLazy »

No one discusses it, but I thought a bit reason WeWork got this far is that when they started, the financial crash meant commercial leases were very cheap. Since they lock those in for 10+ years, but then their contracts with the clients are 1m month plus, they have seen revenue rise with the economy but costs stay roughly the same.

Its sort of the opposite of the problem banks have where they borrow short term and lend long term.

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

#233

Post by solidasparagus »

manigandham wrote: post #179
solidasparagus wrote: post #177

Earlier quoted context omitted.

I assume they mean using WeWork for Stripe's non-primary offices where flexibility is often more valuable.

Stripe is at a size where they can easily afford all the flexibility they need without a middleman company.

'Affording flexibility' means accepting higher costs in order to get short-term leases, which is exactly what companies like We offer. Going the normal office rental route has longer-term leases and thus much less flexibility.

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

#234

Post by DavidHm »

dagw wrote: post #228
delfinom wrote: post #216

Earlier quoted context omitted.

But plenty of "non-WeWork" office space offerings have already been like that for decades. They'll provide janitors, receptionists, etc unless you opt for spaces without it to run your own.

But plenty of "non-WeWork" office space offerings have already been like that for decades. Cynically, those companies have the downside of needing to make a profit. WeWork strikes me as the sort of company that would happily take a massive loss, just to get to brag that Stripe and Facebook use their services.

That's 100% been the case - I am familiar with the industry and they have been more than willing to not make any margin in order to get the clients they want (big names, or poach from the competition)

That strategy works great, so long as you have unlimited funding.

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

#235

Post by andrekandre »

noneeeed wrote: post #146
Donald wrote: post #35

Earlier quoted context omitted.

You can thank loose monetary policy that has created an unbalance between capital seeking returns and the number of investment opportunities. Executives have leveraged this into abusive multi-class share structures that sacrifice shareholder's ability to reign in company behavior. The result is a few tech executives wielding unaccountable authority over incredibly powerful economic resources.

I think it was an episode of Planet Money a couple of months ago, that had an interview with someone senior in the bond world. She seemed really quite worried about the current state of the market. There is so much capital desperately trying to find a home that they are having to invest in companies with very little oversight or influence. In the past they would have been the grown-ups in the room, applying some scru…

do you have a link to that? (can’t seem to find it myself)

i would really like to listen to it because intuitively i’ve felt the same way and wonder what others who are-in-the-know have to say about that.

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

#236

Post by cylinder »

dagw wrote: post #224
abakker wrote: post #201

Earlier quoted context omitted.

That is already available. Ever heard of Cushman and Wakefield?

That is already available. Of course, but I assume that WeWork offered them a better deal.

So WeWork is a property management company which charges less than established players in a very mature market. Explain the valuation then.

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

#237

Post by dagw »

cylinder wrote: post #236
dagw wrote: post #224

Earlier quoted context omitted.

That is already available. Of course, but I assume that WeWork offered them a better deal.

So WeWork is a property management company which charges less than established players in a very mature market. Explain the valuation then.

Something something disruptive technology driven paradigm shift and then they'll make it up in volume :)

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

#238

Post by notyourday »

bradleyjg wrote: post #214
notyourday wrote: post #204

Earlier quoted context omitted.

Does not have much in common - single class of stock with the same rights vs. different classes of stock with different rights.

Still stands for the proposition that directors have a fiduciary duty to shareholders which is subject to judicial scrutiny in the face of self dealing.

That's where I happen to be disagree -- it goes back to the blue sky laws. I think we are going to see it fairly soon - SNAP, in my view, is heading there and it has an insane corporate structure.

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

#239

Post by tyri_kai_psomi »

goatinaboat wrote: post #222
tyri_kai_psomi wrote: post #115

Earlier quoted context omitted.

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 pos…

non-vc backed high tech startups, which are the by far the majority of tech jobs? Citation very much needed. The majority of tech jobs are not at startups of either kind.

Startups is such a loosely qualified term these days that it practically means any business that has "recently started", so no you don't need a citation because the word in of itself is subjective.

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

#240

Post by 100-xyz »

akulbe wrote: post #44

Question, because I don’t know how this works. Who sets the valuation on a company? Does a CEO have anything to do with that, or is it wholly external?

Valuation is based on what percent of shares an investor buys for how much. eg; if I buy 5% (0.05) of a company for 100$. The company valuation would be 100 / 0.05 = 2000$.

It can be a little more complicated with post and pre buy valuation, but that is the general idea.

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