NYU professor calls WeWork 'WeWTF,' says any Wall Street analyst who believes it's worth over $10 billion is 'lying, stupid, or both'
Comment of the Day

August 23 2019

Commentary by Eoin Treacy

NYU professor calls WeWork 'WeWTF,' says any Wall Street analyst who believes it's worth over $10 billion is 'lying, stupid, or both'

This article by Scott Galloway for Business Insider may be of interest to subscribers. Here is a section:

Adam Neumann has sold $700 million in stock. As a founder, I've sold shares into a secondary offering to get some liquidity and diversify holdings. Ok, I get it. But 3/4 of a billion dollars? This is 700 million red flags that spell words on the field of a football field at halftime: "Get me the hell out of this stock, but YOU should buy some."

— Gross margins are a pretty decent proxy for how good or bad a business is. And this is a sh**ty business:

— Adam has several family members working in the business who make "less than $200,000."

— The ownership structure chart is similar to a hieroglyphic on a cave wall about the survival of the species: Harvest the crops when the sun is high in the horizon, do not venture over the hills, hostile tribes live there, and … don't buy this stock. The corporate governance structure of WeWTF makes Chinese firms look American, pre-big tech.

Eoin Treacy's view

There is a growing risk the “liar loans” of this cycle are in the private equity space.

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