By Ellen Cans
It appears that Adam Neumann, the CEO of WeWork’s parent company is calling it quits, for the time being, at least. It was announced Tuesday that embattled CEO has stepped down as the firm tries to salvage its flailing initial public offering, according to a report on theStreet.com
“As co-founder of WeWork, I am so proud of this team and the incredible company that we have built over the last decade,” Neumann said in a statement announcing the move. “While our business has never been stronger, in recent weeks, the scrutiny directed toward me has become a significant distraction, and I have decided that it is in the best interest of the company to step down as chief executive.”
The Street web site reported that Neumann will stay on as parent company We Cos.’ non-executive chairman, but company Chief Financial Officer Artie Minson, formerly of AOL and Time Warner Cable, will become an interim co-CEO along with Sebastian Gunningham, a former executive at Amazon
Gunningham and Minson said in a joint statement that “it is an incredible honor to lead WeWork during this important moment in the company’s history,” adding that they are “evaluating the optimal timing for an IPO.”
It was also recently reported that Wendy Silverstein, the co-head of WeWork’s real estate investment arm, has left the company, as per Bloomberg News. Silverstein stepped down from her leadership position at the company’s investment unit, known as ARK. She will be spending time caring for her elderly parents, as per a source familiar with the matter, who did not wish to be named. Silverstein joined WeWork last fall, as a prominent New York real estate veteran.
Managing Director Rich Gomel will continue to lead the ARK, the source revealed. Larry Fuchs, most recently a managing director of alternative investments at JPMorgan Asset Management, will also be joining the unit. ARK was launched in May with the goal of buying stakes in the buildings which WeWork rents space out in. ARK secured $1 billion from Canadian real estate investor Ivanhoe Cambridge, bringing its assets under management to $2.9 billion.
As reported by the Real Deal, Silverstein said her departure has nothing to do with the company’s troubled planned initial public offering. “Worldwide travel was not compatible with being available for my two elderly parents,” Silverstein commented, in an interview on Friday. A WeWork spokeswoman declined to comment.
Before joining WeWork, Silverstein was CEO of New York REIT. Before that, she had led Vornado Realty Trust’s acquisition and capital markets divisions, overseeing $30 billion of debt and equity financings. She has also previously served on the boards of several well-known companies, including Toys R Us Inc., TPG RE Finance Trust Inc. and Alexander’s Inc.
Silverstein is not the first exec to leave her post at the office space giant. More than six other important figures have already announced their departures from WeWork, as the company has fought to attract investors for its looming public offering. Last week, Sarah Pontius, WeWork’s head of real estate partnerships, declared she was parting as well.
Last week, WeWork announced that it has decided to delay its initial public offering. The co-working space provider, founded in 2010, has enjoyed exponential growth, but operates on small margins and has yet to make a profit. Last year, the company lost roughly $1.61 billion, despite total revenues of $1.82 billion. The super charged startup, which manages over 500 locations of office space around the world, is facing rigorous scrutiny regarding the much anticipated IPO, which is slated to become a measure of the company’s true standing value. Earlier in the month, Wall Street slashed the company’s valuation to less than half, pricing the company’s IPO at $20 to $30 billion.
