WeWork CEO under pressure
Japan’s SoftBank Group Corp, the biggest investor in WeWork owner The We Company, is exploring ways to replace Adam Neumann as chief executive of the US office-sharing startup, four people familiar with the matter said on Sunday.
The rare showdown between SoftBank and one of its biggest investments comes after We Company postponed its initial public offering last week, following pushback from prospective investors, not just over its widening losses, but also over Neumann’s unusually firm grip on the company.
This was a blow for SoftBank, which was hoping for We Company’s IPO to bolster its profits as it seeks to woo investors for its second US$108 billion Vision Fund.
It invested in We Company at a US$47 billion valuation in January, yet stock market investor skepticism led to the startup considering a potential valuation in the IPO earlier this month of as low as US$10 billion.
What was the venture capital world’s biggest upset is now morphing into one of corporate America’s most high-profile boardroom dramas. Some We Company board directors are deliberating how to replace Neumann as CEO. The exact number of directors opposed to Neumann is not clear.