The story of WeWork: When excesses defined a multi-billion dollar startup

In 2008, when the crisis struck, one of the easiest explanations was that some bankers took the money, injected it with steroids, gave it fancy names, and ultimately this crazy money led to the near downfall of the markets. What is not discussed, however, is how this crazy money came about and what has been done to curb this phenomenon. While Marxists would claim that the system is beset with these bubbles and crashes, and the intensity is only set to increase with time as internal contradictions in the capitalist framework move us towards a revolution, what they did not portend was that the system would go blind in pursuit of nothing. The last decade has been a story of both successes as failures, but more important it has been a story of excesses.

The bigger the ego of the founder, the more money he/she can command. Nothing exemplifies this better than the story of Theranos, where investors kept pumping in money for a dream that did not exist. And, the latest on the block is WeWork, where again excesses defined a multi-billion dollar startup, which ultimately collapsed under the weight of its own cliches and desires. Change, the superpower that its co-founder Adam Neumann asserted he possessed, came and destroyed the startup, which was little understood and yet revered.

While one can read a million articles about it and the story is well documented, Reeves Weideman still does justice in bringing out the details of the company leading to Neumann’s exit. Billion Dollar Loser is written carefully and meticulously, devoid of any drama or hype, and thus details the life of Neumann in a careful and calibrated manner.

Weideman starts the book detailing his meeting with Neumann, where he describes Neumann as this larger-than-life unicorn founder (who isn’t?) with a cult-like personality trying to throw obscure ideas at him. The man is depicted as creating and spreading his own legend. That doesn’t deter Weideman in capturing his eccentricities and presenting his own view of the situation. But the author is careful of not letting go of the plot too early.

Weideman carefully builds his narrative with 24 succinct chapters detailing every aspect of Neumann’s life and excesses and how the money supported him and let him use company resources for his whims and fancies. While the focus is certainly Adam Neumann, Weiderman does not lose sight of the story of WeWork. He details the life of Neumann’s wife, Rebekah, who started a school WEGrow, signing admission certificates with her name and a heart. He describes the lavish parties and Adam Neumann’s incessant desire to maintain a billionaire’s lifestyle and the corporate money’s desire to sustain this dream. In one instance, Weideman, describes how this tech-enabled startup was at one point of time managed by a high school kid from Queens. He also deconstructs the farce of a capitalist kibbutz that Neumann spun to distinguish himself, his company and philosophy from other landlords. And, of course, gives us a peek into the mind of Neumann, pouring words that at best mean nothing, aptly representative of today’s times.

While some of the instances do get repetitive, that is not Weideman’s fault, as he is just detailing what happened and how it transpired. WeWork has since undergone a turnaround, and although the pandemic would deal a blow to the company’s fortunes, it would not quench the thirst of capitalists to invest on more such Neumann-styled founders. The market may still not have learnt its lesson, because everything gets whitewashed after a Twitter tirade or a turnaround story.

The start of the field of economics is attributed to Adam Smith and his work, An inquiry of nature and causes of the wealth of nations. We need a careful examination in nature and causes of wealth of startup founders. Probably, that will help us understand what works and what doesn’t, and if a cult personality and lofty ideas are a factor in money making.

Billion Dollar Loser
Reeves Wiedeman
Hachette
Pp 352, Rs 699