WeWork cofounder Adam Neumann bedazzled start-up investors, eventually growing the company to a $47 billion valuation. But when the company’s plans for an IPO tanked, his fall was just as dramatic
JPMorgan CEO Jamie Dimon was also an evangelist. In 2018, JPMorgan led a $700 million bond offering for WeWork. The bank extended Neumann nearly $100 million in loans and was among a group of banks that provided Neumann with a $500 million personal credit line. Neumann told an executive that Dimon was his “personal banker” and might leave JPMorgan to run Neumann’s family investment office one day.
Suddenly, the pasha lifestyle that made Neumann an avatar of the new economy seemed like something else—millennial entitlement gone insane. “When he was on the rise everyone painted the most beautiful picture. On the way down they only wanted to show the most ugly picture,” Sam Ben-Avraham, a Neumann friend and early WeWork investor, told me. Neumann began hearing from WeWork’s bankers that Wall Street viewed him as “toxic,” a person who spoke with Neumann told me.
It was a delusional idea at the time. Neumann was a college dropout with no commercial real estate experience and a business track record of having launched two failed start-ups: a company that sold women’s shoes with a collapsible heel and a line of baby clothes called Krawlers that featured pants with kneepads sewn into the legs.
But achieving this blistering growth resulted in barely controlled chaos inside the company. “The place made the Trump White House look like a well-oiled machine,” a former senior executive said. At WeWork’s first headquarters in the Financial District, there were twice as many employees as available desks in the early days. “They scattered employees throughout WeWorks around the city,” a former executive recalled.
Until a few years ago, the Neumanns were devout followers of Kabbalah, the Jewish mystical faith, and it infused WeWork’s office culture. One employee said key meetings were often scheduled for the 18th of the month because 18 is a sacred number in Kabbalah’s 32 paths to wisdom. Adam encouraged senior WeWork executives to participate in weekly study sessions with his spiritual adviser at the time, Rabbi Eitan Yardeni.
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