WeWorked Over

I am late to the WeWork story, but in my speed education I find it fascinating.  The non-traded alt space is not the only place were reality can get suspended.  In August, WeWork was looking to go public at a $47 billion valuation, and some investment banks had its valuation close to $100 billion, and today, IPO shelved, WeWork is laying off employees and may have to face bankruptcy.  WeWork will inspire a book similiar to Bad Blood's telling of Theranos' rise and fall. 

WeWork's tale to me is simple, and does not involve Theranos' scientific shroud.  WeWork took venture money along with heavy debt and entered into long-term leases with expensive improvements, then leased the office space on a short-term basis.  The timing mismatch between WeWork's lease obligations and its revenue from short-term releases is enough to make me question the viability and sustainability of its business model.  Like Theranos, WeWork had a charismatic founder/CEO who was as able to get continued financing and continued increased valuations for up-round financing. 

The real-world reality of the WeWork story is that it is the largest tenant in New York City and one of the largest in London.  I bet there are some nervous major market landlords.