I think losing $1.9 billion on $1.8 billion in revenue in 2018 (yes, I know it's more complicated than that) has made getting additional capital more difficult. At the same time a self-dealing CEO gives the appearance to investors that he might not be confident that his normal compensation/stock will be worth that much, hence the extraction of value in other ways, leading to concerns about corporate governance that makes private capital more reluctant still. So the IPO is necessary to raise capital, not just to give early investors a soft exit. Now its catching up to them a bit too soon for a maximal IPO, so they're rethinking and perhaps a bit desperately (my interpretation only) going back for more private money.

They didn't anticipate the meddling kids.

What I mean is, they thought they were going to get away with it.

Yup, which to an outside observer is pretty shocking, given how grossly deficient the S1 is. Another commenter in a different thread posted this informative Jason Calacanis podcast about WeWork:

https://thisweekinstartups.com/e969

One part that really resonated is when Calacanis is arguing that, once you become super rich, you need to rely on your authentic, pre-rich friends to give you candid advice (because after you become super rich, you can't really trust new friends when so many folks want a piece of your wealth). Calacanis' idea, which makes sense to me, is that Neumann didn't have a strong enough social base, so that he didn't have anyone candidly telling him stuff like "Umm, you know, this We trademark licensing deal is completely batshit insane and analysts will see this as a giant, bedazzled red flag" before he went ahead and did it.

Insightfully, Calacanis predicted Neumann would walk back the licensing deal, and actually talks about Masayoshi Son being one of the only people that can give Neumann the harsh dose of reality he needs.

I think this is all kind of a moot point, though. It's like WeWork jumped out of an airplane without a parachute and is now going "How do we fix this??" I'd put money down on some form of either (a) a restructuring or (b) essentially being taken over by the major lenders/investors as inevitable.

Softbank cannot let either scenario S or B happen. Masatoshi-san needs the plates to stay in the air for his second fund to come together. He is a man who doubles down until broke. It is both what has made him so successful, and also why I do not buy softbank stock.

> They didn't anticipate the meddling kids.

Nor their dumb dog![1]

[1] The parent reference is to the catch line in Scooby Doo, for those that aren't familiar. And quite well fitting to the situation. https://youtu.be/mbXxgQLlF08

Scrappy was the biggest meddler...always mucking up the works.

I'm not sure what you mean by late to the party. They were the first ones at this party. WeWork has grown through the charisma of its CEO. Based on past performance, it has worked every time.

They're on the extreme end of "startup realizes public markets will call them on their shit" but you can see why they'd be confident they could pull it off.

> "they're on the extreme end of..."

Yes, and it caught up to them just a bit too soon for the IPO. Had the CEO been a little less brazen in his self-dealing, they might have pulled it off with more success.