Episode 2 of The Closer – The Failed Deal That Doomed WeWork (no, not the one you're thinking of) – is out now!
WeWork’s failed IPO is one of the most spectacular and well-covered business flops in recent memory. The company’s 2019 aborted public offering was covered almost with hourly headlines and cable-news chyrons tracking each stumble.
We wanted to go deeper and understand what set WeWork on the path to that failure.
And we found it: it’s called Project Fortitude and it is, in a sense, the deal-behind the deal. Or, in this case, the failed deal behind the failed deal.
We start with Adam Neumann, ensconced in Hawaii for the winter holidays, getting a call from Softbank’s Masayoshi Son on Christmas eve, with some bad news: the Japanese investor is backing out of the audacious plan they’d forged for WeWork. $20 billion to buy most of WeWork, ensuring the company could keep burning through cash and Nuemann could avoid the scrutiny of an IPO.
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The full story is, even after we’ve all been somewhat desensitized to WeWork’s nuttiness, shocking. To fully understand it, we talked with the two people who know the ins and outs of WeWork better than almost anyone: reporters Eliot Brown and Maureen Farrell.
As always, there’s just too much to cram into a single episode, so we wanted to share some of the amazing reporting that helped us create this episode.
So, sit back and crack open a few browser tabs:
– Let’s start at the very end of WeWork’s IPO story. The company finally did go public in 2021 and CNBC has a detailed story on how it happened.
– The rise of WeWork is fundamental to understanding the crash. The WSJ’s Eliot Brown reported in 2018 on the soon to be delivered massive capital injection from SoftBank: WeWork in talks with SoftBank to double valuation to as much as $40 billion
– It’s hard to say exactly when the wheels started to publicly come off WeWork, but if I had to pick a moment, it’d probably be this story from the Brown: WeWork’s CEO makes millions as landlord to Wework.
– The as-it-happened reporting on Softbank abandoning its plan to buy almost all of WeWork.
– Perhaps the definitive news profile of Neumann, written by Brown, has some of the canonical WeWork anecdotes: leaving the cereal box full of weed on the private jet; wanting to be “president of the world”; the semi-random firings by Neumann’s wife Rebekah based on employees’ energy. It’s all there – and a few days later, it was reported that the board was considering getting rid of Neumann.
– The Financial Times’ Eric Platt and Andrew Edgecliffe-Johnson go deep on Project Fortitude. “In hindsight... Project Fortitude was the turning point for both WeWork and the easy-money era it represented.” We couldn’t agree more ;)
– The definitive WSJ port-mortem – The fall of WeWork: How a startup darling came unglued
– Lastly, The Cult of We: WeWork, Adam Neumann, and the Great Startup Delusion by Eliot Brown and Maureen Farrell. It’s the WeWork source. The writing is energetic, the sourcing is exhaustive and impeccable and it’s chock full of absolutely wild details.