Are SoftBank And WeWork About To Head For A Sibling Rivalry?
Despite this, WeWork is planning to press forward according to Reuters. Looking at the bigger picture, it appears that WeWork and SoftBank truly are two peas in a pod.
WeWork’s S-1 filing revealed its goal to “elevate the world’s consciousness,” which may have offered a nervous chuckle from critics, but is it much different from SoftBank’s mission to deliver “happiness for everyone?”
One clear factor the two firms share are their leaders. WeWork CEO Adam Neumann’s majority voting rights gives him the freedom to control who is on his board, while SoftBank’s Masayoshi Son ultimately has the end say over the Vision Fund’s investments.
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Another similarity the two share is how they report their finances. SoftBank’s earnings are fluffed up by “fair value” gains on its investments, despite some of these documented profits being wishful thinking. WeWork, while still unprofitable, tries to make it seem like it is by adding back basic expenses at a “contribution margin.”
Still, WeWork received its first SoftBank investment in 2017, so it might be a reach to blame Son for questionable practices revealed in the coworking firm’s prospectus. Regardless, it is uncanny.
Now, WeWork must choose between delaying its IPO to raise funding from its biggest backer, or go ahead with the offering to the potential disappointment of Son.
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