In light of co-founder Adam Neumann's recent bid to buy back the company, see how the start-up went from being worth $47 billion to bankrupt in under a year.

2019 was the year of scams and scandals. From Lori Laughlin's college admission scandal to <a href="https://www.lofficielusa.com/pop-culture/taylor-swift-joe-alwyn-relationship-timeline-dating" target="_blank" rel="noopener">Taylor Swift </a>and Scooter Braun's <a href="https://www.lofficielusa.com/music/why-is-taylor-swift-re-recording-old-albums" target="_blank" rel="noopener">feud over the rights to her music</a>, scandals both lowbrow and high were doing the most. But it seems like one drama from that era is still brewing.
The WeWork scandal was both tabloid and business page fodder. But before it turned into Hollywood fodder, it was just Adam Neumann and Miguel McKelvey setting up a small business in 2010. Things only went up, up, up, until they unceremoniously came crashing down. Accused of mismanagement and illegal behavior, Neumann was forced out of the company a few years ago, and is now, unsurprisingly, trying to climb his way back in with a multi-million dollar bid. While Neumann claims to be raising $500 million in funds to bid for WeWork and reclaim the success the company was once known for, some suspect he won't be good for the cash, according to <a href="https://www.wsj.com/articles/adam-neumann-submits-bid-to-buy-back-wework-for-more-than-500-million-5148f59d">WSJ</a>.
To catch up on the scandal, check out Apple TV+'s miniseries <a href="https://www.lofficielusa.com/film-tv/anne-hathaway-jared-leto-we-work-series-apple" target="_blank" rel="noopener">WeCrashed</a>. It was released in 2022, and follows the story with stars <a href="https://www.lofficielusa.com/film-tv/jared-leto-new-movie-morbius-trailer" target="_blank" rel="noopener">Jared Leto</a> and&nbsp;<a href="https://www.lofficielusa.com/pop-culture/anne-hathaway-reveals-she-was-ninth-choice-the-devil-wears-prada-role" target="_blank" rel="noopener">Anne Hathaway</a> as Neumann and his wife Rebekah. While the miniseries recreates the public and private drama behind the company's demise, here's a recap of what really brought the multi-billion dollar enterprise to its knees, and what lies ahead as this scandal continues.&nbsp;

Born in Israel, but raised in the United States, Adam Neumann had a dream for the future of workspaces. Tired of the mundane and depressing cubicle lifestyle, Neumann wanted to make office work an experience. Alongside his Oregan native business partner, Miguel McKelvey, the pair opened the first WeWork location in New York City. The space was rented out to freelancers, startups, and other businesses for office purposes. While some leases were contracted for up to 15 years, others could rent monthly. The business boomed and put Neumann and McKelvey's brainchild on the map.&nbsp;

After years of success, WeWork is valued at $4.6 billion. Big shot investors, such as JP Morgan Chase &amp; Co, T. Rowe Price Associates, Wellington Management, and Goldman Sachs Group invest in the company. Neumann has reached a different level of rich and spends his money extravagantly.&nbsp;

Skepticism begins to rise about how long the company will be able to maintain its value. <a href="https://fortune.com/2016/01/21/unicorns-hype-valuations/" target="_blank" rel="noopener">Fortune</a>&nbsp;writes, "For WeWork to live up to its $10 billion valuation, it faces the daunting task of scaling like a software company&mdash;but with people, long-term leases, and office furniture."&nbsp;

Despite people's suspicions about how WeWork will continue to grow, Japanese multinational conglomerate holding company SoftBank invests $4.4 billion into the company. This causes WeWork's funding round to be worth $20 billion.

The company faces backlash from employees as they are restricted to eating-plant based meals only in efforts to "help the environment." Meanwhile, Neumann buys a $60 million jet that he frequently uses. More employees speak out against WeWork's difficult working environment and things begin to tip downhill.

SoftBank invests another $2 billion in funding at a $47 billion valuation. Their investment into the company now totals $10 billion.&nbsp;

WeWork files a public prospectus, or a disclosure document that describes financial security for potential buyers, in order to go public. It reveals the extent of the company's losses for the first time since its start in 2010. From these statements, investors and analysts express suspicions about the company's true value and corporate governance. The documents reveals that Neumann has been charging the company for personal expenses on things such as credit card debt secured by WeWork stock.

September 2019 is a busy month for WeWork. After the backlash over the public prospectus, WeWork announces it is changing the company's governance. Among other things, this allows the board to pick a new CEO, despite Neumann's majority voting rights. WeCompany, the parent company to WeWork, postpones its IPO, or initial public offering, due to the skepticism over the company's public prospectus in August of the same year. After the announcement of the aborted IPO, WeWork faces severe backlash from the public and investors. Neumann is forced to step down as CEO and the company puts his private jet up for sale.&nbsp;

Reports come out that state phonebooths in select WeWork offices are ridden with cancer-causing formaldehyde. After these reports, the company is forced to look into financial lifelines as they face bankruptcy. The company agrees to take a $9.6 billion lifeline support from SoftBank, but Neumann is forced to resign from the board and gives up his special voting rights. SoftBank executive Marcelo Claure takes Neumann's spot as Executive Chairman.&nbsp;

After Softbank bails WeWork out of trouble, Neumann sues the Japanese conglomerate for walking away from a $3 billion bailout. The bailout was a part of the $9.6 billion lifeline deal that gave SoftBank control of the company. As the COVID-19 pandemic throws the world into lockdown, WeWork suffers even further due to its inability to operate. SoftBank values WeWork at $2.9 billion and says it is expected to survive the pandemic hardship due to its larger portfolio companies.&nbsp;

Investors who bought shares in WeWork prior to the failed IPO file a class-action lawsuit against WeWork and SoftBank. The investors allege that WeWork downplayed losses and overhyped its business plan. McKelvey announces his departure from the company soon after the lawsuit.&nbsp;

After Sandeep Mathrani, a veteran retail real estate executive, was announced CEO in 2020, the company begins to get back on its feet. Mathrani cuts overhead costs by $1.1 billion and $400 million in operating expenses. This improves WeWork's free cash flow by $1.6 billion. The company lets go of 106 underperforming or yet-to-be opened branches and negotiates more than 100 lease amendments that bring the company a $4 billion reduction in future lease payments. WeWork signed $850 million of lease contracts in the first quarter of the year, the most it's had since 2019.&nbsp;

Neumann is no longer affiliated with the WeWork company, and only had a share of stocks to his name. WeWork starts working towards restoring the company's reputation and getting back on its feet. As the world began to loosen its grip on lockdowns and COVID-19 restrictions, WeWork could resume operations at a higher capacity.
As far as Neumann goes, he faced severe backlash due to his mishandling of WeWork, most of which were dramatized for your viewing pleasure in AppleTV+'s WeCrashed. Although fans were eagerly awaiting the show's premiere, Leto told <a href="https://variety.com/2022/film/features/jared-leto-morbius-marvel-wecrashed-wework-1235205322/" target="_blank" rel="noopener">Variety</a> that he advised Neumann to not watch it.

Since Neumann's separation from the company, WeWork went down in value, and its share price plummeted. In November 2023, WeWork filed for bankruptcy in the United States but surprisingly still remained in other locations, like Dublin.

Now, WeWork remains bankrupt, and Neumann is trying to get back into the company. He reportedly has been trying to buy WeWork back for months, and recently offered an unsolicited $500 million for the business&mdash;even though its not confirmed he has the financial support to do so.
WeWork hasn't accepted any of his requests, and it's unclear whether they will. What's the future of WeWork?

Everything You Need to Know About the WeWork Scandal

Tags

Related Articles

Film & TV

Anne Hathaway and Jared Leto to Star as Founders of WeWork in Upcoming Series

Film & TV

Get a First Look at Jared Leto in 'Morbius'

Pop culture

Anne Hathaway Reveals She Was the 9th Choice for Her Role in 'The Devil Wears Prada'

Recommended posts for you

L'Officiel Art

That Viral Duct-Taped Banana Just Sold for $6.2 Million

Pop culture

Inside Sabrina Carpenter and Barry Keoghan’s Relationship: Timeline of Key Moments

Fashion

Steph Curry on His Style and NBA Tunnel Walk Philosophy

Fashion

Discover Fashion Inspired by Lanzarote, the Canary Island Gem

Film & TV

Madelyn Cline Navigates Fame

Politics & Culture

The Shocking Tale of a NoHo Nightmare Tenant Who Scammed Across the Globe

Fashion

The Top Resort 2025 Trends, From Fringe to Animal Prints

Fashion

Onitsuka Tiger and Patou Bring Balletcore to the Mexico 66 in New Collab