Equity How WeWork's Adam Neumann made a pigeon look like a swan
Jul 21, 2021
Eliot Brown, a Wall Street Journal reporter and co-author of "The Cult of We," shares insights into the controversial rise and fall of WeWork and its charismatic CEO, Adam Neumann. He discusses the nuances of tech journalism and the challenges it faces in an era dominated by venture capital. Brown highlights lessons for startups, such as the perils of valuing founders over sound financial practices and the need for transparency. Ultimately, the tale of WeWork serves as a cautionary story for today's entrepreneurs navigating the startup landscape.
AI Snips
Chapters
Books
Transcript
Episode notes
Early WeWork Access
- Initially, WeWork welcomed Eliot Brown, giving him open access.
- However, they didn't like being covered by a real estate reporter, as they insisted they weren't a real estate company.
Tech Label vs. Real Estate
- WeWork wanted a tech company label to justify higher valuations, despite operating on slim gross margins, unlike software companies.
- Each new user required physical expansion (desks, office space), incurring costs, unlike software's scalability.
Valuation Red Flags
- Brown's skepticism grew as WeWork's valuation ballooned from $1.5B to $10B in 13 months with minimal business changes.
- This rapid, unjustified growth raised red flags, prompting Brown to question the company's narrative.
