WeWork announces sweeping corporate governance changes in amended S-1; sources: WeWork is now seeking a valuation as low as $10B to $12B in its IPO
Supervoting shares (for Adam Neumann and others) are now 10 votes, not 20 — Rebekah, his wife and WeWork cofounder, no longer has role in picking his successor — they'll add independent board member https://twitter.com/...
CNBCAnnie Palmer
Context & Ripple Effects
The $20B-$30B target floated last week was already a steep retreat from WeWork's $47B private mark, but sources now put the ask at $10B-$12B — less than a quarter of the last private valuation. The amended S-1 pairs the price cut with structural concessions: supervoting shares drop from 20 votes to 10, Rebekah Neumann loses her role in choosing Adam Neumann's successor, and an independent board member is being added.
Adam Neumann's voting grip is halved per share and his succession control is narrowed, while institutional IPO investors gain real board influence through the new independent seat.
Pricing at $10B-$12B would crystallize a collapse from the $47B private mark, leaving employees and late-stage backers holding equity worth far less than their paper valuations.
Second-order effects
Every other loss-making company preparing to list now faces the same buyer's market: underwriters can point to WeWork and demand comparable cuts to founder super-voting rights and related-party entanglements before committing capital.
A valuation below the last private round pressures WeWork's existing investors and any future financing terms, since new capital will be priced off the public number rather than the old mark.
Third-order effects
If the pattern holds, governance concessions — capped supervoting, independent directors, removed family succession clauses — become a standard toll for unicorns crossing into public markets, ending the era when founders could list with unchecked control regardless of losses.
The trend: Public-market investors are forcing loss-making startups to trade founder control and headline valuations for a price the IPO window will actually clear.
“Founder-CEO Adam Neumann will still control @WeWork through dual-class stock for the rest of his life, but only for the rest of his life; the previous version gave him control from beyond the grave.” ~ @matt_levine https://www.bloomberg.com/...
How can an IPO be both “hotly anticipated” and face “tepid interest from investors”? Who, exactly, is anticipating this offering...journalists? https://www.wsj.com/...
WeWork bonds are having a huge rally today as the company presses ahead with its IPO. Here's the spread to USTs https://www.bloomberg.com/... https://twitter.com/...
WeWork looks like it's going to get its IPO out the door by any means necessary - even if it means demoting the founder's wife from her succession-pick role. Wild stuff. https://www.wsj.com/...
Easy to chuckle at this clusterf*ck, but legitimately feel for the common shareholders, the “rank and file”, and entire employee base. They were promised “first floor of AWS”. Now likely almost all will be drowning underwater. https://twitter.com/...
WeWork announces some governance changes Chief among them - Reducing Adam's voting shares to 10 votes per share, from 20. ....Of course, they were increased to 20 from 10 within the past year, in advance of the IPO https://www.wsj.com/...
WeWork has made a handful of cosmetic governance changes as tho appalling governance wasn't just icing on the cake. SNAP IPO'd with essentially no shareholder rights. The concerns are about the biz. Which raises questions why the solution wasn't additional financial disclosures. …
WeWork's pushing forward with IPO 🚨🚨 Amended S-1 changes today include: — Supervoting shares (for Adam Neumann and others) are now 10 votes, not 20 — Rebekah, his wife and WeWork cofounder, no longer has role in picking his successor — they'll add independent board member https:/…