WeWork has always been a wild idea, so it comes as no surprise that its co-founder and previous CEO, Adam Neumann, is known to be a bit too wild as well. When the company started opening up workspaces in 2010, its future looked promising (and so did the future of offices). People who had the chance of working for companies that rented facilities in WeWork buildings always shared stories about their week, casually mentioning going to a yoga class during lunch break or drinking five free macchiatos in one day. Working in WeWork spaces sounded like the future of the workspace. So what happened to WeWork, and when did Adam Neumann lose the plot? Could this be the end of the ‘workspace revolution’?
On 22 September, reports from big publications, such as The Wall Street Journal, announced that WeWork directors were planning on asking Neumann to step down as CEO, after “a tumultuous week in which his eccentric behaviour and drug use came to light.” The Wall Street Journal reported that he had taken $700 million out of WeWork before the planned initial public offering (IPO) of the company. Two days after, Neumann resigned and Artie Minson and Sebastian Gunningham replaced him as co-successors.
WeWork’s filing (also called an S-1) was an expected step in what, up to that point, had been a perfectly choreographed march toward an IPO for the tech industry’s most highly valued startup. Less than a month ago, the company was valued at $65 billion by bankers at Goldman Sachs. Now? It’s valued at $10 billion maximum, and that is only if Softbank, the Japanese tech investment giant that is WeWork’s largest shareholder with 29 percent, invests in the company again in 2020.
WeWork’s other branches, such as WeLive, and WeGrow are all part of the We Company. On its website’s main page, a letter written by Neumann welcomes visitors. Ironically, it is titled The Beginning of a New Story. This letter isn’t about his resignation, however, but rather about how We Company’s goal is to upgrade the WeWork business model by applying its strategy to every other aspect of our lives, which, until now, has been a success.
In less than five years, WeWork became the largest private tenant in London, expending at a ferocious speed. While WeLive has branched into residential accommodation in the U.S., WeGrow has a school in Chelsea, New York, and offers other short term courses all over the world. In other words, We Company is, or should I say used to be, a giant in the market. And like with many companies before, rapid growth mixed with a narcissist CEO prove to be a recipe for their collapse.
The success of the company could explain—without justifying—why Adam Neumann is known to have a messiah complex, stating many times that he wants to “change the world”. But with WeWork’s filing came a steady stream of headlines detailing Neumann’s mismanagement and dreadful behaviour. Despite not talking to anyone about what is happening inside the company right now, WeWork employees previously shared with Business Insider that the previous CEO was known for drinking expensive tequila and smoking marijuana in the office. Neumann made more statements, declaring he wanted to become Israel’s prime minister, the president of the world, and even live forever.
What was supposed to be his celebration as a visionary became one of the most catastrophic debuts in business history. Since the 14 August filing, the company’s free flow of alcohol and its spiritual consciousness has been torn to pieces. And finally, last week, it was announced that WeWork is planning to lay off between 10 and 25 percent of its workforce as its new CEOs focus on the core business.
So what will be left of the myth that WeWork was? The possibility that, maybe, even if the company is on its way out, the workspace revolution isn’t. What WeWork sold to startups, freelancers, and other businesses was the idea that a workspace could also be a place of fun, relaxation, and healthy work—something that we should all aspire to, as freelancers or nine to fivers. And while having candle-making classes every day is not necessary, clean shared facilities and reasonable rents sound appropriate. It’s up to the competition to step up now, and rebrand the idea of a perfect workspace (once more).