2023-11-08 04:30:14
In front of the entrance to the WeWork offices, in New York, November 7, 2023. PETER MORGAN / AP
A few years ago, an innovative concept was imagined: working in a shared office space, in the city, by bringing your computer. This was before the Covid-19 pandemic, which widespread the use of working from home. The American office space rental company WeWork then hoped to “Uberize” the organization of work and was valued at up to $47 billion in 2019. Today, the company is no longer worth anything. As expected, it filed for bankruptcy on Monday, November 6, in a New Jersey court, hoping to restructure its debt and renegotiate its leases with 517 creditors to once again move forward.
According to court documents, it is seeking court authorization to terminate 69 underperforming commercial leases, more than half of which are in New York. WeWork has liabilities of $18.7 billion and assets valued at $15 billion. According to its boss, David Tolley, about 90% of the company’s creditors have agreed to convert their debt into shares, erasing about $3 billion in liabilities.
Thus collapsed WeWork, founded in 2010 in southern Manhattan by Adam Neumann, a young Israeli entrepreneur then aged 31, and the American Miguel McKelvey. The concept was ingenious: carve out office space and sublet it (expensively) to start-ups and individuals. The financial commitment is short-term, the location in the city center is ideal, the conviviality is essential, with the sharing of printers, sofas but also the coffee machine or even the beer keg. Welcome to capitalism 2.0, deceptively casual and in T-shirts.
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An excellent salesman, Mr. Neumann constantly raised funds to be able to get ahead of his competitors. The charismatic young man seduces the Japanese Masayoshi Son, billionaire founder of Softbank, whom he meets in 2016, and who will swallow up more than 10 billion dollars in the adventure. WeWork signs leases in full swing, just before Covid-19, with premises in around a hundred countries, from Sao Paulo in Brazil to Shanghai in China. In New York and London, the firm had become the leading private landlord.
One of the most promising start-ups in the United States
It is one of the most promising start-ups in the United States. This is how it was valued at $47 billion at the start of 2019. Mr. Neumann, who leads the way, is becoming the darling of the media. “Neumann ponders the improbable: becoming the leader of the world, living forever, amassing more than $1,000 billion in wealth. The party has long been part of his professional life, marked by tequila”Write the Wall Street Journal in September 2019, in a portrait which announces his fall.
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