Softbank also has full access to the company’s financials and will be in a position to restructure. It’s safe to say they are a lot better informed than we are.

Why did they do this?

Source: https://outline.com/yCcgS5

If not likely to result in your real estate agents sending more things to you in the future.

They had one open position. It required all applications to have an extensive history at a prestigous VC firm, i.e. they are looking for people from the in-group.

I think a less-incestuous vetting strategy would give more honest results. Too bad, I think there's a lot of people on HN who would excel at this position despite not having worked at a big VC.

WeWork is just going to have to transition from wartime to peacetime. Ben Horowitz has a great article about what this looks like [1]. They're going to clean up the books, stop making risky acquisitions, and focus on the core business instead of side projects. After a few years of being "boring" and improving margins, then they ostensibly will look like a much more stable investment to public markets.

[1] https://a16z.com/2011/04/14/peacetime-ceowartime-ceo-2/

This looks like the upper limit for WeWork. It doesn't matter how much nicer looking their offices are or if they have free beer bashes and parties, those expenses are all tiny when it comes to the bottom line of a multibillion dollar corporation.

Plus, Regus has more desks and branches than WeWork, and is orders of magnitude less expensive.

Just as a thought experiment, imagine that Regus ended up just straight out getting all of WeWork's assets in some sort of liquidation, and half the tenants stayed. They would get bigger!

There is a possibility that WeWork can tap into more interesting markets.

Purely annecdotal, but the people I hear about who ending up in WeWork used to be in either dirt cheap local coworking spaces, or just getting their own offices. It does feel like a "pie got bigger" sort of thing, that wasn't before captured by such a large player.

If WeWork get all Regus assets for free and half their business, sure, why not? That would be an immediate 3-4 billion dollar injection. As it currently stands, their coolness(tm) is not enough to compensate for their bloated fees and limited office space locations.

WeWork can't keep it up forever. Eventually they have to raise prices and/or cut perks (probably both).

But it's definitely not a certainty that the locations will fill to capacity.

The bull case for WeWork that I always heard was based on the existence of a WeWork-shaped market opportunity, and WeWork themselves being in pole position to take it. The bear case was that WeWork was run by crazy people. I think SoftBank’s decisions here are making the best of a bad situation.

If it turns WeWork profitable by cutting costs and implementing responsible leadership, it just keeps its share of all future profits. SoftBank wouldn't be doing this if it didn't think those profits were likely to be more than total investment so far.

In other words, WeWork got acquired instead of IPO-ing.

Yes. The Vision Fund, like all VC funds, has a finite lifespan that all the investors agreed to when they funded it.

WeWork, though, needs a lot more than new capital.

I suppose it’s theoretically possible but Vision Fund invested $10.5Bn in WeWork expecting a multiple of that back for Vision Fund investors. Where will SoftBank get that kind of money?