WeWork has filed for bankruptcy in the U.S.
The company was credited with revolutionising traditional offices when it launched co-working spaces in the 2010s.
At its peak in 2019, WeWork was valued at $US47 billion.
How did it end up bankrupt?
What is WeWork?
WeWork Inc. launched in New York in 2010, providing shared workspaces for freelancers and entrepreneurs (without a ‘usual’ place of work) to conduct their business from.
By December 2022, it had more than 700 office spaces across 39 countries.
WeWork was founded by Adam Neumann and Miguel McKelvey. Neumann’s wife Rebekah was later listed as co-founder in official documents. The Neumanns were the subject of the 2022 Apple TV+ series ‘WeCrashed‘.
WeWoe
WeWork planned to go public in 2019, meaning it would be listed on the stock market.
However, it backed off from its Initial Public Offering after official documents revealed it had obligations to pay at least $US47.2 billion for its ongoing leases.
Further instability emerged with reports the Neumanns’ lifestyle was costing the company significantly.
WeWork planned to go public in 2019, meaning it would be listed on the stock market.
However, it backed off from its Initial Public Offering after official documents revealed it had obligations to pay at least $US47.2 billion for its ongoing leases.
Further instability emerged with reports the Neumanns’ lifestyle was costing the company significantly.
Decline
The company was impacted further by the COVID-19 pandemic, which forced shared office spaces to shut down around the world.
As more employers switched to hybrid work models (a mix of working from home and in the office) demand for co-working spaces has seen a slow recovery.
The share price for WeWork fell to $US0.84 this month, down from a high of around $US520 in 2021.
Bankruptcy
WeWork filed for bankruptcy in the U.S state of New Jersey this week, meaning the company can continue to run while it organises its assets in order to pay its debts.
The company said it plans to file similar proceedings in Canada. However, its offices outside of Canada and the U.S. won’t be immediately affected by the bankruptcy proceedings. There are 15 offices in Australia.
Hours ahead of the announcement, Neumann said the impending bankruptcy was “disappointing”.
