WeWork, valued at $47B in 2019, files for Chapter 11 bankruptcy protection for its US and Canada locations, and reports liabilities ranging from $10B to $50B

The company reported liabilities ranging … Kritikopoulos Spiros : Today's diamonds may easily end up tomorrow's coal! Jerry Kallas : The company leases millions of square feet of office space in 777 locations around the world, according to its regulatory filings. Thomas Hadley : You mean to tell me lease duration arbitrage is not a $50B idea? David Kwok : For anyone who watched WeCrashed on Netflix or really for anyone who lived through social distancing during covid, this outcome will not come as a surprise. … Rashad Morton : See what happens when y'all don't come back to the office lol... Rick Lahkar : One day you're valued at $47 billion with a B. This valuation is done by the best of the best. Then a few years later you file for bankruptcy protection. … Yasir Shaikh : Renting Long and Subleasing Short," which left it “Exposed to Risk. Anukul Singh Mohan / Anukul Singh Mohan, PMP : Wishing WeWork a quick and strong rebound from chapter 11 — Firms exists because of high transaction cost of using the market. … Ryan Himmelreich : If a company worth $47B can file for bankruptcy...any company can. Seltzer Group Partners offers credit insurance and the real-time intelligence to avoid the losses & find the sales opportunities. … Simon Kesterlian / Simon Kesterlian, CFA : We(Didn't)Work — This is what happens when a business model can only work in a certain environment and that environment comes to a sudden end. … Dana Leonetti : A round of applause for all the white male-run “startups” that continue to excel! We could all learn something from them. #startup #greed 👏🏼 … Anessa Allen Santos / Anessa Allen Santos, JD : Remember when WeWork CEO Adam Neumann was hailed by Silicon Valley elites as some kind of genius? It was like they had never heard of Regus. … Peter Deans : WeWork was one of the startup boom's poster children. — It was however not so much a technology business, as a real estate play. … Forums: Hacker News : WeWork, once valued at $47B, files for bankruptcy r/economy : WeWork, once valued at $47 billion, files for bankruptcy r/business : WeWork, once valued at $47 billion, files for bankruptcy r/news : WeWork, once valued at $47 billion, files for bankruptcy r/popculturechat : WeWork, once valued at $47 billion, files for bankruptcy

CNBC 2023-11-07 Rohan Goswami

Context & Ripple Effects

WeWork’s filing confirms the outcome flagged a week earlier in reports that a Chapter 11 filing was imminent. It closes an arc that ran from a $16B financing valuation in 2016 to the company’s 2019 effort to reset IPO expectations amid governance changes.

The stated $10B–$50B liability range makes this more than an equity-value collapse: the restructuring directly involves the creditors and property counterparties behind WeWork’s US and Canadian footprint.

First-order effects

WeWork’s US and Canadian operations enter a court-supervised restructuring, putting creditors and landlords at the center of negotiations over outstanding obligations and locations.
Customers and employees face near-term uncertainty around which locations and services continue as the company addresses liabilities reported at $10B–$50B.

Second-order effects

Landlords with WeWork exposure may need to re-lease or renegotiate space, while flexible-office rivals such as Regus can compete for displaced members and available sites.
The filing reinforces the scrutiny already visible when WeWork cut its targeted IPO valuation sharply in 2019, making capital providers more demanding about the durability of long-term lease commitments.

Third-order effects

If similar lease-heavy, venture-backed businesses face sustained pressure, funding and valuation frameworks will place more weight on contractual liabilities and cash-flow resilience than growth narratives.
The case points to a clearer separation between software-like valuation expectations and property-linked operating risk, though the scale of that shift depends on restructuring outcomes across the sector.

The trend: WeWork is a prominent test of frontier-capital businesses being repriced against the fixed obligations embedded in their operating models.

Discussion

@rogoswami Rohan Goswami on x
WeRestructuring
@internethippo @internethippo on x
Tried to tell them [image]
@ivanthek @ivanthek on x
Gonna start finding out who's been swimming naked soon.
@andyorin Andy Orin on x
more like we don't work [hold for applause]
@refsrc Manish Singh on x
WeWork India statement on WeWork filing for bankruptcy. [image]
@ryanshead Ryan Shead on x
WeWork, once valued at $47 billion, files for bankruptcy. This is why some folks don't want telework to become the norm. Because who will rent the office spaces the rich people own? 🤷🏻‍♂️ https://www.cnbc.com/...
r/economy r on reddit
WeWork, once valued at $47 billion, files for bankruptcy
r/business r on reddit
WeWork, once valued at $47 billion, files for bankruptcy
r/news r on reddit
WeWork, once valued at $47 billion, files for bankruptcy
r/popculturechat r on reddit
WeWork, once valued at $47 billion, files for bankruptcy
@vijayp Vijay Pandurangan on x
... if Adam Neumann somehow buys back wework from bankruptcy with like 2% of the money he made selling his shares, sheds their crappy leases and makes it cashflow neutral, maybe he is some kind of genius afterall.
@thebenbergman Ben Bergman on x
Neumann adds: “I believe that, with the right strategy and team, a reorganization will enable WeWork to emerge successfully.”
@buccocapital BuccoCapital Guy on x
Adam Neumann's official statement on the WeWork bankruptcy filing [video]
@followtheh Tom Hearden on x
Lol Adam Neumann: the company's anticipated bankruptcy filing is disappointing. It has been challenging for me to watch from the sidelines since 2019 as WeWork has failed to take advantage of a product that is more relevant today than ever before.
@andrewglynch Andrew Lynch on x
Is there a more canonical example of “good product, bad balance sheet” than WeWork? $22bn in capital raised, and the only bit of that that's now worth anything is $2.1bn that Adam Neumann skimmed off the top [image]
@jasminecrowe Jasmine Crowe-Houston on x
What's crazy is that the WeWork founder, whom we all watched a documentary on Adam Neumann, last year raised $350 million for at the time a brand new startup. Talk about failing up.
@dceiver Jason Linkins on x
WeWork's Adam Neumann was a guest at The Atlantic's Ideas Forum the same year the firm's market capitalization hit $47b. None of the journalists available to the Atlantic thought to ask Neumann to make that make sense. Oh well: “Womp, womp,” as they say.
@gmomurder Punished Giorgio on x
I do love that FT now describes WeWork simply as a “desk renting business.” Son Masayoshi kept calling it a tech company and for years people went along with it.
@damianwild Damian Wild on x
Adam Neumann says impending bankruptcy “disappointing.” “Challenging for me to watch from the sidelines as WeWork failed to take advantage of a product that is more relevant today than ever.” Ch. 11 allows #WeWork to terminate leases early with little financial penalty in US/Can
@yossigestetner Yossi Gestetner on x
Just because Masayoshi Son valued #WeWork at $47 billion does not mean it was worth that much just as FTX being valued by a few dozen clowns at $32 billion didn't make it so.

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