3 ms·
This paragraph at the end stood out to me: > ...The We Company, used to be called WeWork, but it changed its name. The new name was owned, Bloomberg’s Ellen Hu
by driverdan 7y ago
This paragraph at the end stood out to me:
> ...The We Company, used to be called WeWork, but it changed its name. The new name was owned, Bloomberg’s Ellen Huet reports, by We Holdings LLC — so WeWork paid $5.9 million to acquire “we” and changed its name last month. We Holdings — you guessed it! — manages stocks and assets owned by… WeWork’s founders.
That's a huge conflict of interest. How would something like that be approved?
- tempestn 7y agoApproved by whom? Someone might look at it after the fact, but nothing stops a company from buying or selling with its shareholders. (In fact it's quite common for private companies to pay owners for things like office space.) But yes, it should be at fair market value; you're not supposed to buy something for one price just to flip it to your company for a higher price (effectively taking compensation as a capital gain).
- nostromo 7y agoIn theory, the board. The board represents investors. And usually the big investors will have a seat on the board. The board should have intervened here.
- driverdan 7y agoThat's my point. The LLC owners / WeWork shareholders should have recused themselves due to conflict of interest and the board should have shot it down. This seems really sketchy to me, an end run to get money out of the company.
- lancesells 7y agoDefinitely seem sketchy and should give some people second thoughts about investing.
- tempestn 7y agoAh, yes, in that case I agree. I thought the parent comment was referring to an agency like the SEC.
- elliekelly 7y agoPutting aside the fact that it's absolutely asinine that "we" can be trademarked at all, $5.9 million seems like a pretty hefty price tag for a relatively unknown trademark. Edit: I pulled the trademark[1] on USPTO. I don't know much about IP law but it looks like the mark was only registered in December 2018. And WeWork "rebranded" as the "We Company" in January 2019.[2] Am I reading the trademark info wrong or is that suspicious timing? Could Dec. 17, 2018 be the date WeHoldings LLC assigned it to We Work Corp.? [1] http://tsdr.uspto.gov/#caseNumber=88232116&caseSearchType=US_APPLICATION&caseType=DEFAULT&searchType=statusSearch http://tsdr.uspto.gov/#caseNumber=88232116&caseSearchType=US... [2] https://www.bloomberg.com/news/articles/2019-01-08/wework-s-backers-staff-can-cash-out-in-2-billion-softbank-deal https://www.bloomberg.com/news/articles/2019-01-08/wework-s-...
- quaquaqua1 7y agoThe timing is deliberate-- the founder used company money (from 3rd party investors) to personally enrich himself. It's better than stocks or salary-- it's cold hard cash in an entity he wholly owns rather than partly owns :)
- 3JPLW 7y agoThe whole company is premised upon a conflict of interest. They rent space from the founder. What's another 5.9 million between friends?