WeWork’s mission to “elevate the world’s consciousness” reads like the opening to a George Orwell novel.
So how did a so-called technology company manage to receive a $47 billion valuation and the title of New York City’s largest private office tenant?
CEO Adam Neumann claimed that growing up in Israel led him to supposedly invent coworking after living in a Kibbutz and being enamored with the sharing ideology. It seems that someone forgot to mention that flexible office company Regus first launched when Neumann was still a pre-teen.
The irrationality doesn’t stop there. WeWork’s detailing expenses in their accounts and S-1 filing are not accurate thanks to a community-adjusted EBITA. This accounting principle allows the company to hide fit-outs and marketing expenses. If they had been reported, the firm’s losses would have been at $6 billion instead of $4 billion.
Although one would think the company’s endless supply of beer, freebies and social media ads would be enough to keep their workspaces full, they reportedly sent in teams to photograph competitors’ tenant directories. In fact, Regus is currently engaged in legal actions that have accused WeWork of poaching customers.
While Miguel McKelvey has become less involved in WeWork’s operations, even demoting himself from Co-Founder to Head of Global Culture, Neumann is poising himself as the next Masayoshi Son of SoftBank through his venture capital firm.
Furthermore, Neumann also came under great scrutiny when it was revealed that he was leasing his owned buildings to WeWork, making him both the tenant and the landlord.
Neumann and Co. continue to play dumb, but critics and analysts alike understand that WeWork has dug a hole into an fraudulent, ponzi-like abyss that pays no mind to the audience they continue to bamboozle.