At its peak, WeWork was once valued at $47 billion, making it one of the most valuable tech companies (honestly, who were they kidding) in the world. It has since endured a staggering 99.9% decline, left with a meager market cap of less than $50m. The stock price, which hit an ATH of $520 in October 2021, closed at $0.84 on Friday.
And now, it finally happened. Only 8 months on from a multibillion-dollar rescue package, WeWork announced yesterday that the company was filing for bankruptcy. Or, as they put it, “Strategic action to significantly strengthen balance sheet and further streamline real estate footprint.” Adam Neumann would have been proud of that one.
It marks yet another low point in a remarkable fall from grace. The filing revealed a few details that highlight the extent of the troubles facing WeWork, most notably, the 18.6 billion dollars it listed in debts. It also cited $2.9 billion in long-term debts, which have been crippling the company, and even 100 million dollars in unpaid rent. Numbers that large are hard to pay off when your business doesn’t make profits. In the 13 years WeWork has been operational, it has had one month of profitability, which came last December (and that was adjusted earnings before interest, tax, depreciation and amortization.)
Bankruptcy was the only option left on the table.
Of course, Adam Neumann felt compelled to throw in his two cents, the man who helmed the downfall and pocketed over a billion dollars in return. While his credentials as a CEO should be questioned — if anything, he should be facing criminal charges — it’s clear his ability to extract personal wealth is not in doubt. In a statement released yesterday, he said:
“It has been challenging for me to watch from the sidelines since 2019 as WeWork has failed to take advantage of a product that is more relevant today than ever before. I believe that, with the right strategy and team, a reorganization will enable WeWork to emerge successfully.”
To me, that reads, “if they had just stuck with me, put up with my reckless spending and copious amounts of tequila shots, and believed in the ‘energy of We,’ I would have made the company a success.”