Softbank supports ousting WeWork CEO Adam Neumann
The embattled CEO of WeWork, Adam Neumann, is facing more backlash which has top-level insiders pushing for his resignation.
As first reported by the Wall Street Journal on Sunday, investors including SoftBank CEO Masayoshi Son, the company's largest investor, are now in support of his stepping down and may meet as early as this coming week on the matter.
The report further clouds the company's plan for an initial public offering.
The company parent, The We Company, which describes itself as giving "our members with flexible access to beautiful spaces, a culture of inclusivity and the energy of an inspired community, all connected by our extensive technology infrastructure. We believe our company has the power to elevate how people work, live and grow" is experiencing a chilly investor reception.
Adam Neumann, co-founder and chief executive officer of WeWork, speaks in Shanghai, April 12, 2018. (Jackal Pan/Visual China Group via Getty Images, FILE)
Last week, the company reportedly postponed meetings with investors as it prepares to go public - also known as a roadshow. The company faced concerns in the last few weeks about the sustainability of its business model, which relies on a mix of long-term liabilities and short-term revenue, according to Reuters. It also faces criticism of its governance standards, as founder Adam Neumann, according to Reuters, has 20 times the voting power of ordinary shareholders.
The concerns also question some personal issues such as drug use and eccentric behavior by Neumann, as reported by the WSJ.
WeWork declined to comment to FOX Business citing the company's "quiet period" ahead of any planned offering.
In recent weeks, the company's valuation has dropped to about $20 billion from nearly $50 billion, according to reports.
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WeWork lost $1.9 billion last year, according to its filing with Securities and Exchange Commission.