SoftBank has given WeWork a valuation of $2.9 billion as of March 31, a drop from $7.3 billion at the end of 2019 following its failed attempt to go public.
Masayoshi Son, founder and CEO of SoftBank, said that he was “foolish” to invest billions into the company during an earnings presentation. The conglomerate has reportedly invested $18.5 billion into the coworking company.
On Twitter, WeWork Chairman Marcelo Claure tweeted that he and Son still have faith that the company will emerge from the current pandemic “stronger than ever and are committed to profitability by 2021.”
After two of SoftBank’s Vision Fund portfolio companies, Uber and WeWork, had massive losses last year, the conglomerate’s reputation started to take a hit.
In early January, SoftBank’s $2 billion funding round into WeWork valued the company at $47 billion, shocking many. But as WeWork’s bid to go public started unraveling, so did its hefty valuation.
“We made a failure on investing in WeWork and I’ve been admitting that several times I was foolish,” said Son.
According to Son, out of the 88 companies the Vision Fund has invested in, about 15 will be successful and 15 could go bankrupt in the wake of the coronavirus.