WeWork's valuation, $47 billion in a private funding round last January, could be set as low as $12 billion.
Business
Standard : The WeWork’s roadshow is set to begin this week,
perhaps as soon as today. Such corporate processionals through the
ranks of blue-blooded Wall Street institutions are usually a triumph
for buoyant, young companies. WeWork’s
roadshow, on the other hand, will likely more closely resemble Cersei
Lannister’s humiliating march to the Red Keep in Game of Thrones.
Shame!
WeWork’s valuation, $47 billion in a private funding round last
January, could be set as low as $12 billion.
Shame!
Shame! Investors will no doubt be distrustful of any evidence of
apparent self-dealing by the chief executive officer, Adam Neumann,
such as buying properties and leasing them to the company. (WeWork
took additional steps on Friday to change some of the unorthodox
aspects of its governance structure and seek an independent
board
member.)
As
the nine-year-old office-sharing startup continues its stumble to the
public markets, some prognosticators see this moment as something
more significant: that a WeWork belly-flop portends the end of the
unicorn era in Silicon Valley.
The
argument goes like this: SoftBank, the Japanese conglomerate and its
$100 billion Vision
Fund, has become an engine pushing the technology market to its
limit. If it’s forced to retreat on its $10 billion commitment to
WeWork, SoftBank will reconsider the nearly blind sanguinity that has
perverted incentives for founders and distorted valuations in the
industry over the last few years.
In
this seductive vision of a calamitous—and cleansing—WeWork
initial public offering, modesty will once again return to Silicon
Valley; humbled venture capitalists will stop bidding the valuations
of unprofitable startups into the stratosphere; and the
unicorns—those magical startups worth a $1 billion or more—will
be put out to pasture, their legendary horns clipped like the tusks
of poached African elephants.
But
that’s probably wishful thinking.
