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How WeWork spiraled from a $47B valuation to talk of bankruptcy

28 points by RandomWorker 7y ago

crb002 7y ago
Hopefully they keep on truckin. Gobble up all the abandoned malls etc and flip them for a tidy profit while keeping equity without the IPO dilution.
- notfromhere 7y ago
  They don't actually own any property. The business model just doesn't work in the long-term.
- bobthepanda 7y ago
  Given the siting of most abandoned malls (low density suburbia) and how large they are, I don’t think they’re appropriate for WeWork.
chmod775 7y ago
Valuation isn't money in the bank and - more often that not - does not reflect actual company performance when talking about startups. News at 11. This obsession with IPOs and whatever clowns at wall-street seems to think about certain companies is absolutely unreasonable. If history taught us anything, wall-street is probably the last people you'd want to ask for an opinion. No other sector needs infusions of public money on the reg like they do. I have a suspicion I'll run out of toes to count the number of bail-outs before I die. We're asking them? Might as well flip a coin.
- pmart123 7y ago
  More importantly, once a company exits the product/business model fit phase, it should have better understanding of how it can become self-reliant either through having positive cash flow or a means to it. I would say the recent events have shown why public markets offer transparency and scrutiny that prevents crap being offloaded to smaller investors.
tryitnow 7y ago
This is why I'm skeptical of private weakly regulated markets and why I actually support regulation of capital markets that forces disclosure. WeWork was able to claim an absurd valuation in the public markets, but as soon as they started filing the reports mandated by government regulation they started imploding. I think when government regulation mandates self-reporting and disclosure it has a tendency to work (though not always), whereas when government regulation takes punitive prohibitionist approaches it starts to stumble (again, not always).
WheelsAtLarge 7y ago
I think all of this devaluation for unicorns is a plus for the capital markets. What we are seeing is that VC's have overvalued companies simply because they have fallen into a feedback loop that raises companies value just because someone else invested at a certain valuation. My suspicion is that VC's will start to evaluate companies at a more realistic value and will force new companies to be more realistic about whether there's value in the area they are trying to succeed in therefore giving strength to the market for startups. The downside is that it's going to get harder for startups to get financing. But as always, if you have a good idea and have the perseverance to succeed then you will.

28 points by RandomWorker 7y ago

Hopefully they keep on truckin. Gobble up all the abandoned malls etc and flip them for a tidy profit while keeping equity without the IPO dilution.

notfromhere 7y ago
They don't actually own any property. The business model just doesn't work in the long-term.
bobthepanda 7y ago
Given the siting of most abandoned malls (low density suburbia) and how large they are, I don’t think they’re appropriate for WeWork.

chmod775 7y ago

Valuation isn't money in the bank and - more often that not - does not reflect actual company performance when talking about startups. News at 11. This obsession with IPOs and whatever clowns at wall-street seems to think about certain companies is absolutely unreasonable. If history taught us anything, wall-street is probably the last people you'd want to ask for an opinion. No other sector needs infusions of public money on the reg like they do. I have a suspicion I'll run out of toes to count the number of bail-outs before I die. We're asking them? Might as well flip a coin.

pmart123 7y ago
More importantly, once a company exits the product/business model fit phase, it should have better understanding of how it can become self-reliant either through having positive cash flow or a means to it. I would say the recent events have shown why public markets offer transparency and scrutiny that prevents crap being offloaded to smaller investors.

tryitnow 7y ago

This is why I'm skeptical of private weakly regulated markets and why I actually support regulation of capital markets that forces disclosure. WeWork was able to claim an absurd valuation in the public markets, but as soon as they started filing the reports mandated by government regulation they started imploding. I think when government regulation mandates self-reporting and disclosure it has a tendency to work (though not always), whereas when government regulation takes punitive prohibitionist approaches it starts to stumble (again, not always).

WheelsAtLarge 7y ago

I think all of this devaluation for unicorns is a plus for the capital markets. What we are seeing is that VC's have overvalued companies simply because they have fallen into a feedback loop that raises companies value just because someone else invested at a certain valuation. My suspicion is that VC's will start to evaluate companies at a more realistic value and will force new companies to be more realistic about whether there's value in the area they are trying to succeed in therefore giving strength to the market for startups. The downside is that it's going to get harder for startups to get financing. But as always, if you have a good idea and have the perseverance to succeed then you will.