The Cult of We: WeWork, Adam Neumann, and the Great Startup Delusion
“A revealing, highly readable account of megalomania run amok.”
How did a long-haired college dropout and former baby-clothes salesman who looked like the lead singer in a rock band convince major investors and awestruck millennials that his office-leasing company was a high-tech juggernaut destined to make big money and save the world?
Wall Street Journal reporters Eliot Brown and Maureen Farrell tell the bizarre story in their brightly written The Cult of We. They show how far charisma, audacity, free-flowing alcohol, a dab of New Age woo-woo, and smoke and mirrors made WeWork co-founder Adam Neumann a wealthy man.
In 2008, at 29, Neumann yearned to be rich. He and a partner started GreenDesk, an “eco-friendly coworking space” renting to Brooklyn’s huge population of freelancers. Two years later, they expanded and established WeWork in Manhattan.
Within 10 years, WeWork had more than 400,000 renters (“members”) at 425 locations in 27 countries. They worked in glass-walled offices and common areas that resembled Brooklyn coffee shops. The company was growing faster than Amazon a decade after its founding.
WeWork was valued at $47 billion. Neumann had a personal net worth of $10 billion and owned seven homes.
How it happened is a dizzying, surreal tale.
People were “thirsting to believe in the vision of a messianic and charismatic founder and the profits he could seemingly deliver,” write the authors. “It’s a story about the toxic brew of confirmation bias, fuzzy math, and hubris. It’s a story about what people will do when they are allowed to spend other people’s money with minimal oversight.”
Maybe meeting the wealthy Rebekah Paltrow (cousin to Gwyneth) hastened his downfall. They married in 2008. After she interested the Israeli-born Neumann in mysticism, he realized that he was not just leasing floor space at WeWork. He was creating “tight-knit communities,” eliminating boundaries between work and play, and offering “hipster chic” liberation and “dorm-like energy” to millennial freelancers and small-business people.
On the other hand, one venture capitalist concluded Neumann had created a hook-up culture for twentysomethings. He was “selling sex.”
The authors detail the many ways in which Neumann enticed investors here and abroad. He would elaborately stage company offices for visitors, so they were always “bursting with life and energy.” Chronic growth and higher and higher valuations kept the Wall Street bankers, the mutual funds, Japan’s SoftBank, and other moneymen coming.
The era’s “Silicon Valley hype machine” celebrated Neumann’s “mission-driven” innovation. Investors were “too entranced” to ask questions. Business reporters were adoring. Neumann landed on the cover of Forbes, while 6,000 WeWork staffers sat in the English countryside listening to spiritual guru Deepak Chopra.
The Cult of We chronicles all of Neumann’s “sprawling ambitions.” He seemed “detached from reality, musing about the impossible,” write the authors. He would bring about world peace. He would help develop a new World Trade Center. He made disparate techy-seeming acquisitions: Meetup.com, an event planning site, and Flatiron School, a coding boot-camp.
He gave the firm a new, all-embracing name: We Company.
All along, he had been enriching himself through financial shenanigans. That fact, together with his inability to define the nature of his enterprise, except that “it wasn’t just a real estate company,” triggered sufficient criticism to make him a “laughingstock” in 2019 when his attempt to go public failed.
Neumann became “a meme—a caricature of an irresponsible CEO, driven by avarice and narcissism,” the authors write. He stepped down and took a $185 million exit package.
Business junkies will enjoy the details on deal-making that lace these pages. Most readers will be left incredulous at the unmitigated gall and greed that drove all the major players.
A revealing, highly readable account of megalomania run amok.