WeWork Going Broke Is Not the Real Problem
I mean, you know I had to write about the WeWork bankruptcy, right?
I’ve been targeting WeWork and Adam Neumann for years — as the embodiment of everything that’s wrong with the current state of the startup ecosystem. But I’m certainly not taking any pleasure in this final(?) coda to the WeWork horror story. I’m not trying to use Neumann as a punching bag or anything like that. There is no schadenfreude here.
Because I don’t think the failure of WeWork is necessarily the real problem.
Cult Of Personality As a Business Model
Adam Neumann is an easy target because he defines the cult of personality that is the modern-era investable CEO. He, along with Elizabeth Holmes at Theranos and maybe even Billy McFarland with Fyre Festival, were arguably the holy triumvirate of the concept of bad money chasing even worse money down a hole of what eventually was revealed to be nothingness.
This isn’t to call a crook a crook. That’s for courts and civil actions to decide. What I’m talking about is the revelation, after the last of their company embers have burned out, as to how these folks raised so much money and built out so much… stuff on an idea and a business model that turned out to be, at best, paper thin.
When you do the post-mortem and sift through the ashes, there’s a general vibe of “holy shit, good thing we caught on to those guys” — and this is often coming from the same outlets and mouthpieces that were pumping them up on the way up.
When you read about the downfall of the companies, especially Theranos, it takes quite a while before the article gets past the person and into the company and how that company went from everyone’s darling to everyone’s cautionary tale.
In other words, the schadenfreude is more about the alleged fraudster than the actual failure. Adam Neumann is an easy target because WeWork is not.
WeWork Was Not An Overnight Success
WeWork caught absolutely no one off guard. The company formed in 2010 and then landed a $1 million seed round in 2011. They…