WeWork Chapter 11 bankruptcy
WeWork filed for Chapter 11 bankruptcy, and I've been waiting for this shoe to drop for years. The company that was once valued at $47 billion in 2019 just collapsed under $10-50 billion in liabilities. This bankruptcy covers their U.S. and Canadian operations.
CEO David Tolley's talking about "restructuring and focusing on core products," which is corporate speak for "we're in deep trouble." The pandemic destroyed their business model, but let's be honest - WeWork's problems started way before COVID. They were burning cash and signing terrible long-term leases while pretending to be a tech company instead of a real estate sublease business.
Remember their failed IPO five years ago? That should've been the warning sign. They had to go public through a SPAC in 2021, which is basically the last resort for companies that can't pass traditional IPO scrutiny. Then they did a 1-for-40 reverse stock split just to stay on the NYSE. When you see that, the writing's on the wall.
Adam Neumann calling this "disappointing" is rich. He walked away with billions while the company burned down. Sure, WeWork's product might have potential in today's hybrid work environment, but the execution was catastrophically bad. They're sitting on nearly $16 billion in long-term lease obligations they can't afford.
WeWork says they're "here to stay," but Chapter 11 is about survival, not thriving. This is a cautionary tale about hype, terrible unit economics, and what happens when investors confuse growth with a sustainable business model.