The company believed it was ready for an IPO, but all the potential IPO investors disagreed after reading the S-1 and doing some diligence. In a sense the system worked well in that regard.

The big issue was with the private investors letting the CEO do whatever he wanted and pushing the valuation up very high.

It's clear that investment banks are incentivized to maximally value a company. Valuing a company is pretty simple, in that you can tweak certain values in, say cash flow analyses and depreciation projections to literally make billions of dollars appear on paper. They have complete deniability in that, at whatever moment, their proprietary analyses and due diligence appears in a prospectus that public markets are supposed to just trust in good faith. That way, when the banks capture the spread on an IPO (difference in price guaranteed to a firm vs IPO price), the banks can offload shares en masse to investors and gain the spread, only paying capital gains taxes. It's pretty much theft, unless you are a very very early investor, to sell stock in something like WeWork as an investment bank. Financial giants aren't like other companies. If they don't make deals every single day, they will die. They have no product, nothing to offer that improves and compounds upon previous products (save, perhaps, for algorithmic trading software). Are we really surprised that this bloated corpse of an industry known for churn, extreme burnout, and grift would overvalue an IPO when it serves them?

> how is it possible that one moment the company is ready for an IPO...and then next month be desperate for cash?

An IPO is fundamentally a fundraising event, so it makes some sense.

The harder question would be why is some successful, well-funded company looking do dilute shareholders for even more funding.