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WeWork Accepts SoftBank Takeover Offer
- deleted 7y ago[deleted]
- untog 7y ago[edit: deleting comment]
- nighthawk648 7y agoWhat’s more insane is the hundred mill he got after being forced out... such a shame
- ceejayoz 7y agoI know it's basically "go away quietly" money, but the idea of wanting him consulting on anything is kinda hilarious.
- nighthawk648 7y agoDamn what do I do to get go away money instead of jail time?
- vkou 7y agoWell, he did spend 12 billion dollars building a 8 billion dollar company, so surely, he deserves some reward for his efforts..?
- nickpinkston 7y agoYea, and Elizabeth Holmes should've gotten richer for her "innovation" and "job creation"... /s Let's not reward charlatans. Here's how we used to treat them: https://en.wikipedia.org/wiki/Jeffrey_Skilling#Legal_proceedings https://en.wikipedia.org/wiki/Jeffrey_Skilling#Legal_proceed...
- misiti3780 7y agoI'm not defending Adam N, but Jeffrey Skilling committed out right fraud, as far as i know, no one has accused that of happening at We Work
- xkjkls 7y agoIt depends on how you define "fraud". It was definitely run with a lax definition of truth.
- nickpinkston 7y agoSeemingly there's a lot of pump-n-dump types of situations going on that in this case SoftBank was complicit with Adam with. This is not an isolated case, and I'm glad Wall St. called bullshit on WeWork, but likely only because even they couldn't place those bullshit IPO shares - not enough greater fool liquidity out there apparently... Sounds like a case for optimism :D
- untog 7y ago[removed]
- hef19898 7y agoTrue! And why would you expect a billionaire to invest some money i to his own company when said billionaire is a serial entrepreneur!
- SirensOfTitan 7y agoI strongly dislike WeWork, even may have issues with its fundamental business model, but it's difficult for me to understand how someone could label it as a failure. WeWork is not Theranos: they have a product offering that works well for a lot of businesses.
- xkjkls 7y agoA single product offering doesn't make a sustainable business. Ultimately, for it to work for these businesses, they need to prove that they can sustain the business model without capital injections.
- deleted 7y ago[deleted]
- dang 7y agoWould you please stop posting unsubstantive, ranty comments to HN? It isn't that you owe dysfunctional companies or dislikeable billionaires any better. But you owe this community better if you want to keep posting here. There are lots of places on the internet to vent rage. There are not as many to gratify intellectual curiosity. These two things are incompatible. Here we want intellectual curiosity. If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html and taking that spirit to heart, we'd appreciate it.
- untog 7y agoIt was a flip, lighthearted comment and I thought that was pretty self-evident. But fine, I’ve deleted it.
- save_ferris 7y agoThis is a feature of the current Silicon Valley model, not a bug.
- xkjkls 7y agoIt's a feature of extremely cheap capital and low interest rates, not just Silicon Valley
- achow 7y agoReuter is giving better picture of how this is being worked upon. SoftBank has agreed to give him (Neumann) $500 million to refinance his personal loans, as well as pay him a $185 million consulting fee. SoftBank will additionally launch a tender offer for up to $3 billion to acquire WeWork shares from existing investors and employees.. Neumann’s ability to tender his shares will be capped at $970 million. https://www.reuters.com/article/us-wework-softbank-group/wework-board-accepts-softbank-rescue-deal-source-idUSKBN1X11JN https://www.reuters.com/article/us-wework-softbank-group/wew...
- dang 7y agoOK, we've changed to that from https://www.nytimes.com/2019/10/22/business/dealbook/wework-softbank.html https://www.nytimes.com/2019/10/22/business/dealbook/wework-.... Thanks.
- champagnepapi 7y ago>Mr. Neumann also will receive a $185 million consulting fee LOL, that's they type of "consulting fee" I need
- pashabitz 7y agoIf you owe the bank $100, that's your problem. If you owe the (soft)bank $100 million, that's the bank's problem.
- hef19898 7y agoIn the latter case you also kind of own the bank.
- tibbydudeza 7y agoSoftbank ... now offically the Pets.com of 2019.
- birdyrooster 7y agoPersonally, I enjoy watching the Saudi Vision Fund money go up in flames. SoftBank is deeply associated with the murderous Mohammad Bin Salman and gets the benefit of his brand.
- nostromo 7y agoExcept 250 times bigger. (Pets.com max market cap was $400 million. Softbank's Vision Fund is 100 billion.)
- xkjkls 7y agoHow much of that capital has actually been deployed yet?
- basch 7y agoSoftbank was the Pets.com of 2000. Their market cap dropped from $200B to $2B. Masayoshi Son was "worth more" than Bill Gates for 3 days. It's their playbook. Although they left the dotcom crash losing 99% of their value, they walked out with a stake in Alibaba now worth over $100B.
- jjakque 7y agoPlanet money has a podcast episode on WeWork and Masayoshi: https://www.npr.org/2019/10/04/767379358/episode-943-unicorn-cowboy https://www.npr.org/2019/10/04/767379358/episode-943-unicorn...
- nostromo 7y agoI'm confused as to why this is so terrible. He created a very valuable company, worth billions of dollars. It makes sense that he should capture some large fraction of that wealth. Yes, some people will lose their jobs. But it's worth noting that those jobs wouldn't have existed in the first place if he hadn't started the company. His mismanagement has cost him and Softbank billions, which is appropriate as well. I say this completely aware of what a shitshow WeWork is. edit: For context this was a response to https://news.ycombinator.com/item?id=21325431 https://news.ycombinator.com/item?id=21325431 but the mods detached it for... some reason?
- ianlevesque 7y agoDid he though? The IPO revealed it to be essentially a scam that failed to fool the public.
- Barrin92 7y ago>He created a very valuable company, worth billions of dollars he created something that may very well lose its investors billions of dollars without ever turning a dime of profit. What the company is evaluated as on paper by people increasingly disconnected from reality isn't really meaningful. I'm not really sure what the market function or social function is of rewarding people with billions of dollars who create money-losing machines. If anything it's an indication that some part of the system is increasingly broken.
- nostromo 7y agoPerhaps I'm just not seeing any real victims here. Softbank and the Saudis wanted to roll the dice on some overpriced unicorns. They went into the deal with eyes open. And it looks like they're taking a massive haircut. Play stupid games... I do feel sorry for some WeWork employees that will lose their jobs. But, again, many of them joined hoping to get some upside when the company went public -- which was a gamble that didn't pan out. Thankfully it's a good time to be on the job market.
- x0x0 7y ago
- neural_thing 7y agoWhat I don't understand is why Softbank didn't just buy the bonds and take control of the company during a restructuring. Would've been much cheaper, no need to pay Neumann anything.
- xkjkls 7y agoPartly to probably save face on all of their other investments in the Vision Fund. They still have a number of other companies in their portfolio that they hope to one day take public, and compounding this disaster wouldn't be helpful to them
- vkou 7y agoThat would have given Neumann a few more months to run it into the ground.