WeWork has been discussed on the forum a couple times, notably HERE where the discussion is around the concept and if people like it, and HERE where discussing if a lack of professionalism may have been the straw that broke the camels back.
For those not following along, there has been a lot going on lately. The tl;dr is that the company was scheduled to IPO this month, at an estimated $47b valuation, making it one of the most valuable startups of the decade.
Further due diligence showed increasing losses every quarter and year. As revenue increased, losses increased. It was a good test of the markets appetite for another high growth-high loss IPO. The company wanted to be valued as a tech company vs a real estate company. Ultimately, the much hyped IPO was delayed, then shelved indefinitely.
Now, SoftBank is expected to announce a package to take control of the company it has already invested billions into, at a valuation that is 20% of what it was a month ago.
Now, we must give credit where credit is due. Adam Neumann, the founder and former CEO saw a need and came up with a valuable solution. He is receiving an exit package worth up to $1.7b for his role.
Also, SoftBank’s team are no dummies, you don’t develop two $100b investment funds by being lucky or by buying Apple at the right time.
With the new deal, SoftBank will have a company, valued at $8b that they have already and/or committed to investing $15b into.
I would love to hear some takes on a path to profitability for WeWork. Is this a massive example of sunk cost fallacy for SoftBank? Or did they just acquire a $45b company for $15b?
For those not following along, there has been a lot going on lately. The tl;dr is that the company was scheduled to IPO this month, at an estimated $47b valuation, making it one of the most valuable startups of the decade.
Further due diligence showed increasing losses every quarter and year. As revenue increased, losses increased. It was a good test of the markets appetite for another high growth-high loss IPO. The company wanted to be valued as a tech company vs a real estate company. Ultimately, the much hyped IPO was delayed, then shelved indefinitely.
Now, SoftBank is expected to announce a package to take control of the company it has already invested billions into, at a valuation that is 20% of what it was a month ago.
Now, we must give credit where credit is due. Adam Neumann, the founder and former CEO saw a need and came up with a valuable solution. He is receiving an exit package worth up to $1.7b for his role.
Also, SoftBank’s team are no dummies, you don’t develop two $100b investment funds by being lucky or by buying Apple at the right time.
With the new deal, SoftBank will have a company, valued at $8b that they have already and/or committed to investing $15b into.
I would love to hear some takes on a path to profitability for WeWork. Is this a massive example of sunk cost fallacy for SoftBank? Or did they just acquire a $45b company for $15b?
Dislike ads? Become a Fastlane member:
Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)
Last edited:
Access Restricted: Unlock 1,000,000+ Posts
Stop Peeking Through the Keyhole.
Open the Door.
You hit a wall because the best advice isn't free—it's earned. Since 2007, MJ DeMarco has been active here daily (99.9% active rate), building a war room for entrepreneurs who refuse to settle for mediocrity.
- Active Daily: Life-changing content posted dozens of times every day. No dead threads.
- MJ's Inner Circle: Direct access to the author of The Millionaire Fastlane.
- Vetted Network: Connect with founders scaling to 7 and 8 figures.
- Proven Roadmaps: Strategy over motivation. Execution over "hustle porn."
"SCALED TO 6-FIGURE MONTHS"
"Tips and advice here saved me from huge mistakes, others allowed me to scale my business to 6-figure months."— User MitchC
"INSANE QUALITY OF PEOPLE"
"The number of high quality people I've met from this forum has been insane. All of it predicated on building real value."— User Richard Peck
"You are the average of the five people you surround yourself with."
Are you surrounding yourself with success?
