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Money News

The Rise and Fall of WeWork

October 29, 2019
wework sign on building exterior

3 min read

WeWork’s initial public offering (IPO) was supposed to be one of the most successful of 2019.

In less than a decade, it had received billions of dollars from investors, expanding from a single office building in Manhattan to a network of shared working spaces across the globe.

But soon after it filed its S-1 paperwork with the Securities and Exchange Commission (SEC) in August 2019, things began to unravel.

The paperwork showed WeWork had hundreds of millions of dollars of debt, which reportedly caused investors to question the company’s $47 billion valuation, and whether the company’s business model was working. It also brought up questions about the leadership of Adam Neumann, WeWork’s chief executive, and co-founder.

Sometimes things don’t always work out as planned. And an IPO can just as easily be unsuccessful as successful.

If you’re confused by what happened with WeWork, we’ll break it down for you.

Why are IPOs important, and why do they sometimes fail?

More details about WeWork

Other unsuccessful IPOs this year

While WeWork’s scenario is extreme, because it ultimately cancelled its IPO and had to be bailed out from the brink of bankruptcy, it has followed other unsuccessful high-profile IPOs this year, such as Uber, Lyft, and Peloton.

The lack of success of ultra-hyped IPOs has led experts to speculate that private valuations of many companies seeking IPOs today are maybe too high.

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All investing involves risk, and it’s possible for your investments to lose value. Stash recommends following the Stash Way, which includes investing for the long-term, investing regularly, and diversification.

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By Jeremy Quittner
Jeremy Quittner is the senior writer for Stash.

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