It would appear that rumors of WeWork’s demise have been greatly exaggerated.
That’s according to Marcelo Claure, the SoftBank executive who’s been charged with revitalizing the beleaguered shared office-space provider after its botched IPO last year. In an interview with the Financial Times on Sunday, Claure—who presently serves as WeWork’s chairman—said the company is on track to meet its goals of positive cash flow and profits by 2021.
“Everybody thought WeWork was mission impossible,” Claure told the FT. “And now, a year from now, you are going to see WeWork to basically be a profitable venture with an incredible diversity of assets.”
Claure attributed the firm’s abrupt turnaround to heavy cost cuts that saw WeWork shed 8,000 jobs—more than half its total workforce—as well as strong demand for the company’s flexible office spaces in the wake of the coronavirus pandemic. The likes of Mastercard, Microsoft, and Citigroup have signed new lease agreements with WeWork over the past month, with the goal of providing satellite offices for employees and spreading out workers beyond their main offices.
“We have companies like Facebook, Google, and Amazon who have told their employees that they can work from wherever they are,” according to Claure. “We have a lot of those employees who basically now come to a WeWork facility to use it one day a week, two days a week, three days a week.”
SoftBank—the Japanese private equity giant that drove WeWork’s valuation to an astronomical, ill-fated $47 billion—installed Claure as WeWork’s chairman in October, shortly after company cofounder and CEO Adam Neumann stepped down following the IPO debacle. Since then, WeWork has appointed real estate industry veteran Sandeep Mathrani as CEO, and has pursued a restructuring that has seen the company downsize its office portfolio and shed noncore assets.
Meanwhile, SoftBank and WeWork remain locked in litigation over SoftBank’s decision to pull out of a $3 billion stock buyout of WeWork, which would have seen shareholders like Neumann and venture capital firm Benchmark reap a windfall. SoftBank scrapped the deal in March as economic conditions deteriorated owing to the pandemic, claiming that certain stipulations had not been met.
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