The idea was relatively simple — what if offices, but
disruption? Essentially the company bought up some of the most expensive real estate
in the world — in some of the most expensive cities
in the world — and gave them a nice millennial once-over. You know the look: mid-century modern furniture, clean lines, blinding white natural night, hardwood, open floor plan, succulents, kombucha, revolting neoliberal work ethic sloganeering like “Rise and Grind” and “Do What You Love” everywhere. Then they spent a ton on marketing, believing they were destined to rake in a rentier’s ransom from freelancers, gig workers, and “small business owners” with a keen eye for start-ups — hey, why not build your tenuous bubble on a whole bunch of other smaller, even more tenuous bubbles?
As an added bonus, WeWork tracked their tenant’s data (the profit potential of which isn’t terribly clear), allowing them the dubious self-identification of “tech company,” despite the entire thing hinging on a massively speculative and costly real estate venture.
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SoftBank’s initial investments totaling $8 billion in 2017 sent WeWork global, and another $2 billion in 2019 doubled their valuation to $47 billion, a number that the absolute bare minimum of bar-napkin math would have exposed as wildly overvalued. For their part,
Financial Times had been sounding the alarm well before they hit $47 billion, but by August of this year, even
Forbes was declaring WeWork “the Most Ridiculous IPO of 2019.”
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Neumann became famous for demanding his employees do shots of $140-a-bottle Don Julio tequila with him during interviews, staff meetings, and at the mandatory, hours-long team-building exercises (called, of course, “Thank God It’s Monday”). He boasted that he worked twenty-hour days and hid employees during public appearances so the company looked “leaner.” He would insist he needed no support staff for overseas work, change his mind, then fly out assistants to London for six hours of work before sending them right back to New York.
The cult of WeWork was an intimate one; at one point, Neumann formally employed at least twenty friends and family members and surrounded himself with many others in less formal capacities. His father sat in on meetings, despite not working at the company. His sister wasn’t a WeWork employee either, but she did the same, and reportedly ordered WeWork staff to watch her young children, who Neumann preemptively secured work emails for. His brother-in-law was appointed head of WeWork’s gym venture. His experience? Fifteen years as a professional soccer player. Neumann envisioned a WeBank, a sea-steading WeWork called WeSail, and insisted that “WeWork Mars is in our pipeline,” (though
by his own account, he failed to woo fellow intergalactic space god Elon Musk into a business partnership).
Neumann’s wife, Rebekah Paltrow Neumann (cousin of Gwyneth), was given the title of his “
strategic thought partner.” Ivanka Trump and Jared Kushner came to her birthday in Italy. Rebekah opened a private, “conscious, entrepreneurial”
elementary school in New York, with tuition ranging from $22,000 to $42,000 a year, hoping to attract parents with this terrifyingly messianic mission statement: “We are committed to elevating the collective consciousness of the world by expanding happiness and unleashing every human’s superpowers.” They are closing after their first year.
To say that Neumann has a god complex is almost underselling him; this is a man who was so sure of his genetic dynasty that he believed his “generationally controlled” company would
pass down that absolute control to his descendants in perpetuity. In a leaked video at an “all-hands” staff meeting, he frothed in his megalomania:
It’s important that one day, maybe in one hundred years, maybe in three hundred years, a great-great-granddaughter of mine will walk into that room and say, “Hey, you don’t know me; I actually control the place.”
Only on his way out did Neumann finally get nailed, but even then, only on one of his smaller grifts; in 2019, he trademarked the word “we,” changed the name of the company to “The We Company,” and then sold the rights to use it
back to his own company for $5.9 million. His punishment? After some understandable ethical scrutiny,
Neumann gave the money back. Three weeks later, the board voted on his position of CEO; along with others, Neumann voted himself out, scot-free.
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It’s true that there are
no clean hands in a dirty world, but WeWork has been
exceptionally dirty from the get-go, even for tech, even for
real estate. It’s an American company, but it was funded primarily by SoftBank’s $97 billion “Vision Fund,” the largest private pool of money ever raised, nearly half of which was bankrolled by the Saudi sovereign wealth fund.
SoftBank famously secured this cash after its CEO, Masayoshi Son, had a quiet little meeting with the crown prince to let him know that the recent dismemberment of Jamal Khashoggi hadn’t shaken his faith in the royal family. And, of course, Neumann strove to maintain that relationship.
