WeWork Inc. (NYSE:WE) is a Manhattan-based company that provides flexible workplace solutions to individuals and organizations around the world. The company and its founder and former CEO, Adam Neumann, have been the subject of significant controversy and speculation in recent years. Neumann is now facing his toughest test as the company is reportedly wrestling with major financial issues.
Earlier this week, the Wall Street Journal reported that WeWork planned to file for bankruptcy as early as the first week of November. A bankruptcy filing could finally spell the end for the company’s headline-grabbing rollercoaster ride. At one point, WeWork had reached a valuation of US$47 billion before it tried its hand at an initial public offering (IPO). However, its valuation sank to U$10 billion which quashed hopes of a successful public offering.
After the debacle, Neumann was removed as CEO and the company was eventually taken over by its largest investor Softbank. While the IPO debacle hurt its reputation, WeWork sustained the hardest blow due to the COVID-19 pandemic. The health crisis saw millions upon millions of citizens in the developed world start to work from home. This made WeWork’s business model largely outdated overnight. It attempted to explore projects like a private elementary school and a gym concept called Rise By We.
Shares of WeWork have plunged 43% week-over-week as of close on Wednesday, November 1. The stock has now dropped 97% so far in 2023. Investors will want to keep a close eye on WeWork to see if the reports on its bankruptcy filing turn out to be accurate.
