What do the words “physical social network” mean to you? A pub? A tennis club? A book group? Wrong, wrong and wrong again. In fact, a “physical social network” is how the founder of Wework describes his world-changing creation. The purveyor of shared office space is less a company and more a “state of consciousness”, according to Adam Neumann. If there were an award for new-age hokum, the 40-year-old Israeli would scoop the Oscar every time. It says something of the mindset of the venture investors at the tail end of a near-decade-long bull run that Mr Neumann has been able to raise such prodigious sums for his loss-making company. There’s little doubt he’s a charismatic showman. One part Elon Musk, one part L Ron
WeWork’s portfolio of 27 offices across 425 countries makes it highly vulnerable to a downturn in the economic cycle. Despite mitigating its risks and reducing the possibility of contagion by creating new subsidiaries for each building it leases, SoftBank ’s reduced investment in the company has unnerved investors, who seem focused on: Oscar personal portfolio of property investments leased to the company that has raised governance flags, a burn rate of $1.2m in the first nine months of last year and its bond price indicating the company’s borrowing cost is now north of 10% .