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is it a bailout? I thought it was a thinly vieled takeover.

• ineedasername 7y ago
  Kind of both. The takeover was necessary to preserve their investment and any possibility of future gain: improved governance and pivot to profitability instead of growth are the cornerstones of a better IPO valuation in a year's time. In order to make it that year, they have to pump more money in. If they can convince IPO investors in a year that it's a $20billion company by doing so, they might approach break even territory.
  • perl4ever 7y ago
    $20B? That seems like at least one too many zeros. My impression is their largest competitor is IWG plc, formerly Regus, which has a market cap of around $4.5B or 1.3x sales. Applying that to WeWork I get around $2-3B.
    • ineedasername 7y ago
      $20B is optimistic, but not outside the realm of possibility if they can show revenue growth by filling the inventory they've been building, at the same time they drastically curtail the cash burn needed to obtain still more inventory. They're on track for a 50% increase in 2019 revenue over 2018 revenue, and if that growth continues into 2020, then an IPO in a year wouldn't be completely unreasonable at 5x revenue on the basis of continued revenue growth. Still a bit high for a traditional real estate company, but they may still have some tech-adjacent mojo to prop it all up. It's a longshot, but not impossible.
      • perl4ever 7y ago
        It seems unlikely to stop selling space at a loss while maintaining revenue growth. After all, if they can do that, why didn't they already?