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WeWork lays off 2,400 employees

cnbc.com

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Re: WeWork lays off 2,400 employees

#141

Post by rchaud »

toomuchtodo wrote: post #32
macspoofing wrote: post #30

Earlier quoted context omitted.

To be clear, Neumann's $1.7 billion payout is from SoftBank shareholders. There's nothing obviously criminal about SoftBank's bailout. But I agree SoftBank didn't have to do it. WeWork was ostensibly bankrupt and SoftBank could have dictated pretty much any terms they wanted.

SoftBank is trying to obtain a $2.8B loan for turning around WeWork [1]. Sunk cost fallacy at scale. SoftBank should've burned WeWork and Neumann's comp to the ground, while still paying out severance to the rank and file ("shoot the hostage"). Instead, SoftBank looks incompetent, Son looks incompetent, Neumann walks away a billionaire for delivering nothing of value, and layoffs are still happening. They're doubling…

They're doubling down to save face. They're betting that WeWork can survive as a much smaller company and that in 5 years people will forget what a disaster this was.

Re: WeWork lays off 2,400 employees

#142

Post by kp98 »

neya wrote: post #17

I still can't believe this guy gets to walk away with 1.7 billion dollars just for building up fluff while all the people who helped him grow have dire consequences both financial and personal. Unbelievable that this guy gets a clean chit, and all this isn't considered criminal. This to me is almost at the scale of Theranos. Only, this guy was smarter in the legal side of things, perhaps.

I think you could consider WeWork worse than Thernanos in many ways. Far more people understood what was going on at the highest level, and when all was said and done Elizabeth Holmes walked away with nothing but criminal prosecution. Both screwed their investors, arguably Thernanos did worse, but investors prepare for potentially big losses.

The employees on the other hand are all screwed: at Thernanos Holmes was the most screwed given the potential jail time, but at WeWork Neumann is walking away with over a billion, which is sort of like spitting on your employees.

WeWork (Neumann) preached about the 'We Generation' and 'elevating the world to a new consciousness,' but really his actions were traitorous against the people who made him. Thernanos never claimed the moral high ground, nor did the leader get off like a bandit.

Re: WeWork lays off 2,400 employees

#144

Post by [deleted] »

rchaud wrote: post #141
toomuchtodo wrote: post #32

Earlier quoted context omitted.

SoftBank is trying to obtain a $2.8B loan for turning around WeWork [1]. Sunk cost fallacy at scale. SoftBank should've burned WeWork and Neumann's comp to the ground, while still paying out severance to the rank and file ("shoot the hostage"). Instead, SoftBank looks incompetent, Son looks incompetent, Neumann walks away a billionaire for delivering nothing of value, and layoffs are still happening. They're doubling…

They're doubling down to save face. They're betting that WeWork can survive as a much smaller company and that in 5 years people will forget what a disaster this was.

[deleted]

Re: WeWork lays off 2,400 employees

#145

Post by JanSt »

chewz wrote: post #119
prewett wrote: post #82

Earlier quoted context omitted.

> if you define a market simply as a mechanism of wealth transmission from dumb people to smarter Who defines a market with that kind of cynical, silly definition? I don't think most of us want that kind of "market". And if that's the only way to make Neumann look good, then maybe the reverse is true.

There is a definition of stock market as a mechanism of wealth transfer from active investors to patient/intelligent investors. Most of the people are jumping one over the other to lose money as quickly as possible on some fantastical promise of profits. Human nature is like that. Intelligent people made money out of this sentiment since money had been invented.

> There is a definition of stock market as a mechanism of wealth transfer from active investors to patient/intelligent investors.

That's certainly not a definition. Investing is not zero-sum.

Re: WeWork lays off 2,400 employees

#146

Post by lotsofpulp »

chris11 wrote: post #137
lotsofpulp wrote: post #115

Earlier quoted context omitted.

Unless Neumann presented fraudulent numbers, then the buyer is responsible for valuing what they buy. Sellers don't get to dictate what something is worth.

I'm not arguing that Neumann's actions meet the legal definition of fraud. I'm arguing that he has a moral responsibility. Investors are responsible for believing Neumann. But I think that if he had been an ethical person who did not self-deal, WeWork might not have been over valued so much. I think self-dealing and dishonestly representing your company's worth is related.

The self dealing was not hidden, so I am perplexed why one would think a company with self dealing is worth more than a company without self dealing.

Neumann, as a seller, went out into the market and found some buyers. A seller sells for the most they can, and the buyer buys for the least they can. Except in this case, the buyer wanted to flip it, so the buyer wanted to over value it, so that they could claim it was worth even more (due to the rate of increase in "valuations") when they try to IPO it.

If anyone was lacking in morals, it would be the buyer who intentionally paid more than they knew they would if their aim was to hold onto it as a business, just so they could pawn it off onto someone else who didn't know better.

Re: WeWork lays off 2,400 employees

#147

Post by Uhuhreally »

rollerboi wrote: post #116
AlexandrB wrote: post #99

Earlier quoted context omitted.

> was phenomenally successful at building a large, real business What? How? He built an 8b business with 16b in investment. Anyone can do that. Take 16b, put it in index funds, call yourself an investment bank. You'd get better returns than -50%, for sure.

Not just anyone gets 16b of funding to lose 50% on it. You need to be a very charismatic CEO - maybe borderline cult-leader status

and there you have hit the nail on the head

Re: WeWork lays off 2,400 employees

#148

Post by SwiftyBug »

p1esk wrote: post #106
raincom wrote: post #95

Earlier quoted context omitted.

Thanks to surveillance and collusion between politicians and the elite, now the elite is more protected than ever.

Was the elite less protected in 17th century?

They ended up having their heads cut off, so, yes.

Re: WeWork lays off 2,400 employees

#149

Post by rchaud »

kevin_thibedeau wrote: post #98
neya wrote: post #17

I still can't believe this guy gets to walk away with 1.7 billion dollars just for building up fluff while all the people who helped him grow have dire consequences both financial and personal. Unbelievable that this guy gets a clean chit, and all this isn't considered criminal. This to me is almost at the scale of Theranos. Only, this guy was smarter in the legal side of things, perhaps.

On the bright side. He has to watch his back for MBS henchmen.

He really doesn't. For that kind of investor, the portfolio is more about having strategic connections to big players rather than purely making money. I'd imagine the next time Son comes around to ask for money, MBS will have more leverage than he previously did.

Re: WeWork lays off 2,400 employees

#150

Post by nopriorarrests »

dickeytk wrote: post #74
Strom wrote: post #69

Earlier quoted context omitted.

Options in a startup are always a lottery ticket. I would argue that no rational person assigns any significant value to them, because even career investors aren't able to pick winners and instead earn money by betting on a lot of different startups.

Big difference between a startup and a massive valuation that everyone assumes is about to IPO. WeWork deflated more than any company in HISTORY. You’re technically correct but people are irrational and I’m sure they were being lied to their face in all hands about how great the future would be. At that stage as an employee you’re counting on those to be able to put down a down payment or do a much needed renovation,…

>WeWork deflated more than any company in HISTORY.

Cisco went from 77$ per share in 2000 to $10 per share in 2002, while being public (so the value was much more real than WeWork, you could hit the 'sell' button to make it real money in 5 minutes, unlike WeWork equity).

IIRC it was valued around 500 billions in 2000, so it was much larger destruction in value. It still hasn't recovered, with $45 per share right now, never reaching its 2000 peak during these 19 years.

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