WeWork has had a roller coaster ride. In 2019, it was valued at $47 billion after Softbank had poured $18.5 billion into the start up. Yesterday it went public via a SPAC at a $9 billion valuation.
WeWork's troubles began when the company released its IPO filing in August 2019. It had lost $1.9 billion the previous year, and was on track to run through its remaining cash. CEO, Adam Neumann's management style and activities, such as selling a trademark he owned ("We"), to WeWork for $6 million came under intense scrutiny. Neumann stepped down as CEO that month, and received a cool $1.7 billion to do so.
WeWork's troubles did not stop as it suffered massive losses after Covid-19 shut down its office spaces worldwide.
Yesterday, WeWork got a 2nd chance after its $9 billion SPAC merger with BowX Acquisition. After all the drama, Neumann is worth about $2.3 billion. Even after his share sales, he’ll own stock worth $722 million in the new company.
Short Squeez Takeaway: Only time will tell if WeWork is able to make the most of its 2nd chance. Adam Neumann is probably not worried though. Other than his WeWork ownership, his venture capital portfolio is worth $2 billion, which includes companies such as loan servicer Valon Mortgage and Selina, a hotel chain. His real estate portfolio is also worth about $1.5 billion. (Looks like he is doing slightly better than fellow scammer, Theranos founder, Elizabeth Holmes)