Adam Neumann, co-founder and CEO of WeWork, the popular shared workspace community and office services globally, has been in the news lately as he stepped down from the position of CEO.. The official reports also informed that, he will continue his journey in the company as a non-executive chairman of the board.
WeWork’s Artie Minson, formerly co-president and chief financial officer, and Sebastian Gunningham, formerly vice-chairman, have been named co-CEOs of the company.
Adam Neumann said:
While our business has never been stronger, in recent weeks, the scrutiny directed toward me has become a significant distraction, and I have decided that it is in the best interest of the company to step down as chief executive.
This move comes after WeWork’s plans for a stock market listing ran into trouble, with investors raising concerns about losses and governance.
Who is Adam Neumann?
Adam Neumann was born in Israel, the son of Avivit and Doron Neumann. He graduated from the Israeli Naval Academy and subsequently served as an officer in the Israeli Navy for five years. In 2002, he attended the Zicklin School of Business at Baruch College in New York City but dropped out later. Before founding WeWork, Neumann founded a children’s clothing company, Krawlers, that went on to become a luxury Egg Baby brand.
In 2010, Neumann and McKelvey co-founded WeWork, and since then, the firm has expanded from a single office in New York City to more than 500 locations in 29 countries.
Furthermore, the Japanese investment giant Softbank helped the company to reach a valuation of about $47 billion (approx €43 billion) in its most recent investment round.
However, Adam Neumann charming personality emerged as a liability, as WeWork decided to sell its shares on the public market. Amid this, the firm’s expected valuation had sunk to between $10bn and $12bn.
Potential investors also questioned his decision making and the ways his hard-partying habits had infused corporate culture. Most of them believed that Adam Neumann had blurred the lines between his finances and WeWork.
As a result, Neumann made some arrangements since it became clear that he was losing support from significant backers, including Softbank. So he returned $5.9 million (approx €5.3 million) in stock he received for selling WeWork the trademark “We.” Also, his wife Rebekah, the cousin of actress Gwyneth Paltrow, had her role reduced.
Richard Kramer, the founder of Arete Research, said:
“WeWork is a property company trying to sprinkle tech company fairy dust over itself. That won’t work with investors.”
In an interview with BBC, Sam Reynolds, a technology analyst, said:
“I think the IPO will be delayed indefinitely. WeWork certainly has a future, but not as a public company.”
Main image credit: Stock Photos from lev radin/Shutterstock
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