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WeWork says will file to withdraw IPO

reuters.com

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Re: WeWork says will file to withdraw IPO

#91

Post by vasco »

wgerard wrote: post #72

I see lots of cheering which, to some degree, I understand given the public persona of Adam Neumann. I'm more interested in the ramifications, and I don't just mean the obvious ones like "potential tech recession" (maybe, who knows) or "more due diligence" (unlikely, or if so likely to swing completely the other direction). Given that "private markets are the new public markets" I wonder if this will just encourage m…

One possible ramification is that the so called "window" is about to close and as such, most companies will have a bit of a higher bar to IPO. "Good" companies might raise money at worse terms than otherwise. Backpressure could mean a harder environment to raise capital all the way back to early rounds. Or this is just a one time shitty governance company and things will keep going. You know, past results yada yada.

Re: WeWork says will file to withdraw IPO

#92

Post by flmontpetit »

goatinaboat wrote: post #70
goobynight wrote: post #52

Earlier quoted context omitted.

The people at these companies actually handling individual contributor level execution are pretty talented. It's just that the plan/model they work under is not sustainable.

Cultural fit is so important these days and every one of them was a cultural fit at an extremely shady company. Even if they weren’t participating in the rampant excesses, they were still willing to go along with it.

We're talking about an office here, not a SS regiment.

Re: WeWork says will file to withdraw IPO

#93

Post by pcwalton »

john_moscow wrote: post #71
axiak wrote: post #39

Earlier quoted context omitted.

I think the pure tech plays in 2019 are doing just fine. Zoom, Cloudflare, and Datadog all look like good companies. They're just not over-hyped and overinflated.

Cloudflare still relies on the "massive amount of free users creating buzz vs. a tiny fraction of paid users". Although not an obvious scam, they may very well go the Groupon way.

That wasn't Groupon's problem. Cloudflare and Groupon have virtually nothing in common.

Re: WeWork says will file to withdraw IPO

#94

Post by mytailorisrich »

S_A_P wrote: post #19

What I don't understand is how do things get this far down the road before a good old fashioned sanity check happens? I have got to think that Soft Bank knew/knows the valuation was off. The fact that they pushed on means they either intended to try and get away with it/take the money and run as I cant believe incompetence is the reason here. How did this get so far along??? As for Adam N, I have to think some part o…

In finance no-one admits that they screwed up unless they have no choice, if at all.

Re: WeWork says will file to withdraw IPO

#95

Post by akulkarni »

papito wrote: post #88
akulkarni wrote: post #77

Earlier quoted context omitted.

This is a classic "bottoms-up" model that is quite viable (eg Dropbox, Slack, Zoom, Elastic, MongoDB). Not sure why anyone would call it a scam. In fact, I would be wary of software companies without a base of free users, as that means the company needs to keep spending a lot of its revenue on sales and marketing.

Not necessarily. You don't need marketing and sales people if you have a free-tier product that markets itself. Michael Stonebraker, the guy who took Postgres from academia and into the real world, talks about how he applies this with VoltDB https://www.se-radio.net/2013/12/episode-199-michael-stonebr... Only on a tangent - it's an otherwise fascinating episode from a database wizard.

It seems like you are agreeing with me? :)

Re: WeWork says will file to withdraw IPO

#96

Post by jnwatson »

puranjay wrote: post #36
dcchambers wrote: post #6

Earlier quoted context omitted.

How many engineers does WeWork actually employ though? From everything I've read on here they're not really a tech company. I can't imagine that, even if it all goes up in flames, there will be many SWEs looking for new jobs from this. Uber is another story. They've got a sizeable engineering force.

I honestly think Uber has over-invested in engineering. The problem they're trying to solve isn't so complicated that it needs their current engineering force. They don't have to add new features at as rapid a pace as a true software-focused company like, say, Stripe.

Absolutely. They need a huge operations and driver support/sales team, but R&D not so much, outside of the self-driving money pit.

Re: WeWork says will file to withdraw IPO

#97

Post by callalex »

S_A_P wrote: post #19

What I don't understand is how do things get this far down the road before a good old fashioned sanity check happens? I have got to think that Soft Bank knew/knows the valuation was off. The fact that they pushed on means they either intended to try and get away with it/take the money and run as I cant believe incompetence is the reason here. How did this get so far along??? As for Adam N, I have to think some part o…

Twilio is an example of a recent unicorn with sane financials.

Re: WeWork says will file to withdraw IPO

#98

Post by benj111 »

axiak wrote: post #39
S_A_P wrote: post #19

What I don't understand is how do things get this far down the road before a good old fashioned sanity check happens? I have got to think that Soft Bank knew/knows the valuation was off. The fact that they pushed on means they either intended to try and get away with it/take the money and run as I cant believe incompetence is the reason here. How did this get so far along??? As for Adam N, I have to think some part o…

I think the pure tech plays in 2019 are doing just fine. Zoom, Cloudflare, and Datadog all look like good companies. They're just not over-hyped and overinflated.

This sounds slightly like a no true Scotsman arguement to me. I'm sure you could find some none pure tech plays that are successful.

Plus companies like Uber don't exactly own assets, its more tech company than not.

For all the promise of the Web, people live in the real world, that's where the money is to be made, mega tech companies are necessarily going to live at the interface.

Re: WeWork says will file to withdraw IPO

#99

Post by rdiddly »

S_A_P wrote: post #19

What I don't understand is how do things get this far down the road before a good old fashioned sanity check happens? I have got to think that Soft Bank knew/knows the valuation was off. The fact that they pushed on means they either intended to try and get away with it/take the money and run as I cant believe incompetence is the reason here. How did this get so far along??? As for Adam N, I have to think some part o…

Everyone has a vested interest in continuing to believe that which they already believe. To change your opinion requires acknowledging that your old opinion, the one you perhaps espoused publicly and persuaded others into believing, was wrong. It's embarrassing. So most people tend to put that reckoning off until the last possible moment, even in defiance of hard evidence in some cases.

Re: WeWork says will file to withdraw IPO

#100

Post by ac29 »

akulkarni wrote: post #77
john_moscow wrote: post #71

Earlier quoted context omitted.

Cloudflare still relies on the "massive amount of free users creating buzz vs. a tiny fraction of paid users". Although not an obvious scam, they may very well go the Groupon way.

This is a classic "bottoms-up" model that is quite viable (eg Dropbox, Slack, Zoom, Elastic, MongoDB). Not sure why anyone would call it a scam. In fact, I would be wary of software companies without a base of free users, as that means the company needs to keep spending a lot of its revenue on sales and marketing.

> Dropbox, slack

Are these good examples, though? Dropbox is down ~35% since IPOing, and Slack is down almost 50%. This certainly suggests the market thinks they were both overvalued when they IPO'd.

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