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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

#251

Post by notyourday »

goatinaboat wrote: post #235
notyourday wrote: post #157

Earlier quoted context omitted.

True, but consider: 1. They want some turkey. 2. WeWorks is a turkey that already exists, in a good enough form and, should non-wanker management be installed, fat trimmed and the co being returned to real estate business rather than technology business, it seems to be a pretty tasty and immediately available one. 3. Buying it outright would have been a lot more expensive. Is it any different from Softbank investing…

WeWork is not worth $16Bn. IWG is only worth $3.6Bn and is many times the size by sq ft under management. I don’t believe that WeWork is even worth $1Bn using similar valuation.

Err... that's not an accurate comparison. If Softbank gives WeWork $10B for 100% of the company then its book value will skyrocket as its liabilities won't increase even by a penny but it will get 10B on its balance sheet. There's not a single company in the WW lines business that has this kind of a prospect. Regus simply can't raise this kind of money -- if they could, they would have.

Re: WeWork says will file to withdraw IPO

#253

Post by JumpCrisscross »

semi-extrinsic wrote: post #182
JumpCrisscross wrote: post #156

Earlier quoted context omitted.

> WeWork's scale does give them a bit of an advantage Within the original thesis per se it gave them a possible demand-side advantage. (Commercial real estate is too big for any meaningful sell-side advantages.) Being able to say "let's open a branch in Singapore and see how it goes for 6 months" with a few clicks is quite awesome. If I trusted it to be around in a few years, it would change how I think about deployi…

> Being able to say "let's open a branch in Singapore and see how it goes for 6 months" with a few clicks is quite awesome. I'd have thought that for most businesses, the two big obstacles for doing this are a) getting skilled people to suddenly move to Singapore at your will, and b) getting the Singapore office well integrated with the rest of the company. Compared to those two, setting up an office lease is about a…

> Compared to those two, setting up an office lease is about as hard as tying your shoelaces

This has not been my experience. Given how localized real estate markets are, they haven't been subjected to efficiency-driving global competition. The result is every market has hidden oddities. Little details that are a nuisance if you know about them but a disaster if you bumble through the process.

For long-term commitments to a market, sure, it makes sense to own your plot. But for short-term assignments? Toes in the water? Being able to spin up an office with flown-in staff committed to for the short-term, to develop leads and/or find those skilled locals to hire, is a tactical advantage which doesn't presently exist.

Re: WeWork says will file to withdraw IPO

#254

Post by einpoklum »

ixtli wrote: post #12

I feel bad for the stary-eyed kids one year out of college that are going to get mass fired. They're all really young and naive :/

"Starry-eyed kids" who went to work for a company which is a glorified landlord for office space?

Somehow I doubt they had a bright and hopeful vision for humanity in mind when they joined up.

Re: WeWork says will file to withdraw IPO

#255

Post by rland »

danesparza wrote: post #200
wpietri wrote: post #188

Earlier quoted context omitted.

I think there's a class of narcissist that doesn't really have knowledge and beliefs as much as they have desires and things to say that get them closer to their desires. So in some sense I think asking what Adam Neumann and Elizabeth Holmes really believe is a category error. Knowing the truth makes lying really hard. If you spend a lot of time figuring out what's true, that builds mental habits that make lying feel…

I think the OP's question really involves the CFO or any accountants involved in this case. I would expect the CEO to be driven more by vision than by cold, hard facts.

I'm guessing that the issues have something to do with the management structure.

If your CEO is delusional, it's usually possible to reign him or her in... From what I understand, Neumann had some special votes that basically allowed him to fire the board at any point.

I imagine that anyone with a pragmatic mindset willing to ask "wait, but the numbers are..." was pushed out of the picture either explicitly or implicitly by the power imbalance.

Re: WeWork says will file to withdraw IPO

#256

Post by winslow »

samstave wrote: post #104

Here is the “how I built this” for ‘we work’ Listen to this, to compare to the current state of WeWork https://www.stitcher.com/podcast/national-public-radio/how-i...

Oh nice find! This is going to be an interesting listen.

Sounds like from the intro blurb that this was potentially recorded in June 2017 and this is a replay of that episode Sep 2 2018.

Re: WeWork says will file to withdraw IPO

#257

Post by sk5t »

rconti wrote: post #240
sk5t wrote: post #66

Earlier quoted context omitted.

> Peloton is one that comes to mind Is it not possible that both investors and the public will find the shine off the apple of pairing two independently somewhat unattractive things--a stationary bicycle and a hefty monthly fee--as used models start to hit the secondary market? Have you ever tried to sell a used stationary bicycle? It ain't easy! The evidence of the gulf between good intentions and regular use is rig…

We have a Peloton bike and treadmill both. I haven't watched too closely, but occasionally people ask about selling their bikes (or buying a used bike to save money), and the impression I get is that they hold their value relatively well. Then again, asking price != sale price. I'm trying to validate but all I'm finding on sfbay.craigslist is coupon codes and "Peloton style spinning bike" and so forth.

What I've observed, very very anecdotally, is that Peloton buyers become emotionally invested, and it turns out that they don't use the thing much, but resist strongly the idea of selling it at a huge loss and admitting defeat. Because buyers tend to have quite a bit of disposable income, it takes a long time to drift down to a market-clearing price.

Re: WeWork says will file to withdraw IPO

#258

Post by rhizome »

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…

>What I don't understand is how do things get this far down the road before a good old fashioned sanity check happens?

Willing dupes. It's a one-step jackpot if you can handwave all that stuff away, or if it never comes up in the first place.

Re: WeWork says will file to withdraw IPO

#259

Post by dragonwriter »

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…

> As for Adam N, I have to think some part of him knew that it was a bullshit valuation

But that's always the goal: get someone to pay you for somethig more than you think it is worth. And, conversely, they always want to buy it for less than it's really worth. Each side is hoping the other side’s value assessment is BS.

Re: WeWork says will file to withdraw IPO

#260

Post by goatinaboat »

notyourday wrote: post #251
goatinaboat wrote: post #235

Earlier quoted context omitted.

WeWork is not worth $16Bn. IWG is only worth $3.6Bn and is many times the size by sq ft under management. I don’t believe that WeWork is even worth $1Bn using similar valuation.

Err... that's not an accurate comparison. If Softbank gives WeWork $10B for 100% of the company then its book value will skyrocket as its liabilities won't increase even by a penny but it will get 10B on its balance sheet. There's not a single company in the WW lines business that has this kind of a prospect. Regus simply can't raise this kind of money -- if they could, they would have.

Well sure but why would they pay 10x as much as it’s worth? Remember they have already invested $10.5Bn. So they would be paying a grand total of $20.5Bn and what would be their exit strategy from that?
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