WeWork has embraced the “too big to fail” mantra and poses an honest-to-goodness systemic risk...and the punchline??? They know it. Thanks for all the great content.
"You're tearing me apart, Scott!!" "It's BS, I did not con investors, I did naaaht" "I can't tell you, it's confidential. Anyway, how is your sex life?" It plays so well and now I can't get it out of my head.
@@sinematographers3344 I picture meetings with investors as the scene when Tommy is collecting flowers "Hi, can I have another billion dollars please?"..."Oh hi Adam, I didn't know it was you, here you go"..."Thanks, I'll keep the change... Hi, doggy"..."You're my favorite CEO"... Or when asked about the cult-like following WeWork has, it could cut to the scene "You know what they say... Love is blind" or "If a lot of people love each other, the world will be better place to live"
The “business” video world on RUclips is an absolute shitstorm. Thank you for providing real expertise and valuable content. I am increasingly annoyed at the amount of useless and surface level business content online. This channel gives me hope
Strong unit economics - analysis here of gross margins is wrong because it doesn't account for GAAP straight-lining of leases which overstates expenses. There's costs when you open a new location (find a building, sign a lease, design the space, build it out, then fill it) that only happen once at the beginning of 15 years. They've opened a huge number of locations so those costs are high, but they've been funded because the cash-on-cash returns are high, which is what SoftBank sees.
This video, in retrospect, is probably the greatest all-time take down of a major company. WeWork was a disaster prior to the IPO, during the IPO, and to top it all off, the discussion about asymmetric timelines was written for 2020.
I read that We has structured the leases through "fuse" companies. If they need to get out of a lease, they let the lease holder go bankrupt and walk away. The landlords will be holding the risk. Anyone looked into this?
Yes that's true, they're held in special purpose vehicles and they only guarantee leases for a short amount of time. They can walk away from them, though in reality this probably just gives them an additional point of leverage if things do really go badly in one of the markets and their space (which is cheaper than most corporate space on a per employee basis) isn't filled.
@@damanamathos sounds to me like we and the landlords will be fighting it out in court and the tenants will be collateral damage, by getting locked out or something. Fun times ahead...
@@Nico-wp6jq unlikely to come to that. Easier for landlords to renegotiate, although before it even goes there WeWork has some benefits from wide geographic diversification, 40%+ enterprise tenants with longer leases, and the fact they save corporates 50% on occupancy per employee. Downturns could be positive for them, apparently they've done ok in weaker markets so far.
Let's look at WeWork from a different point of view. Let's say, that the name should be complete, such as WeWorkForBanks. Why? Easy. Just analyze the fake recovery of the housing market since 2010. Soon you will find out, that there are millions of homes under disclosure... but the lenders don't act against them. Why? Because that would bring down the market value of their properties. If you throw 3 million estates on the market, the prices will go down like in a illegal tobogan. Banks tried it all, as you can see. They need the subprimes, they need mortgages... but they cannot get rid off their delinquent base. This is not only the case for the US. The same in Europe, the same in Asia. Now... what about creating some companies that could use all these void square meters? Doesn't matter if they cost a lot, they will ALWAYS be cheaper to maintain than delinquent propierties in the millions. So, there companies pop up, who - against all odds - offer space, make some money, but cannot attract enough customers. Why? Because they are limited to the propierties their investors push into their scope. Just have a look at the properties they are using now, and find out that a huge percentage... comes from banks. Investment banks can have losses. Traditional banks, mortgage related positions... cannot. So, the investment bank flips billions into the farce-company, traditional banks earn some return for the first time in 9 years, their properties get renovated, and... adios WeWork, welcome WeWash... as this is money laundering at its best, completely legal... as long as you haven't the original and secretive agreement found out about. I mean, if an idiot like me can come to this fast conclusion, bankers wouldn't have let this opportunity go, or reserved it for very critical moments. Btw, that housing bubble is now like eight times bigger than it was like 12 years ago. Banks are clearly out of cash, worldwide. Looks pretty critical to me, but... I'm not a banker. Lol.
I watched Rick and Morty and I could understand it well despite the high speed they talked. This guy - I can't understand what he is saying unless I put payback to .75.
Well perhaps Adam plans to buy some cheap buildings when his creation is liquidated during the next downturn. Then he can start the cycle all over again. I’d bet he could find some money center banks to lend him money again.
WeWork has embraced the “too big to fail” mantra and poses an honest-to-goodness systemic risk...and the punchline??? They know it.
Thanks for all the great content.
Think Arbitrage the movie.
So WeWork is just the Fyre Fest version of The Office.
They're just the biggest there's a few friends they've got coming in hot too.
Then there's the rival dog walking services
I love how people say "WeWork was the Fyre Fest of startups" conveniently forgetting that Fyre Fest was actually the Fyre Fest of startups.
I personally love it. Gotta teach these "investors" a few lessons. I SWEAR THESE COMPANIES ARE REAL DAD!
Tommy Wiseau plays Adam Neumann "Oh hi Markets"
"You're tearing me apart, Scott!!"
"It's BS, I did not con investors, I did naaaht"
"I can't tell you, it's confidential. Anyway, how is your sex life?"
It plays so well and now I can't get it out of my head.
@@JB-so5gr "Leasing the Room"
“ Why, Leasa, why, WHY?!”
@@sinematographers3344 I picture meetings with investors as the scene when Tommy is collecting flowers "Hi, can I have another billion dollars please?"..."Oh hi Adam, I didn't know it was you, here you go"..."Thanks, I'll keep the change... Hi, doggy"..."You're my favorite CEO"...
Or when asked about the cult-like following WeWork has, it could cut to the scene "You know what they say... Love is blind" or "If a lot of people love each other, the world will be better place to live"
Damn I love this guy! straight to the point deliveries. No BS. Under 3 mins! Clean and clear!
I’m really glad you used the tone you used. I feel like everyone should be talking about this company this way
So you’re sayings there’s a chance...
Appears Big Dawg was spot on... again... As if there was any doubt!
The “business” video world on RUclips is an absolute shitstorm. Thank you for providing real expertise and valuable content. I am increasingly annoyed at the amount of useless and surface level business content online. This channel gives me hope
What i don't understand is why Softbank invested in them
Prop up paper profits prior raising their next fund. They inflated WE to have 'profits'
Strong unit economics - analysis here of gross margins is wrong because it doesn't account for GAAP straight-lining of leases which overstates expenses. There's costs when you open a new location (find a building, sign a lease, design the space, build it out, then fill it) that only happen once at the beginning of 15 years. They've opened a huge number of locations so those costs are high, but they've been funded because the cash-on-cash returns are high, which is what SoftBank sees.
I just want a supercut of Scott Galloway roasting WeWork for the last 4 years.
This video, in retrospect, is probably the greatest all-time take down of a major company. WeWork was a disaster prior to the IPO, during the IPO, and to top it all off, the discussion about asymmetric timelines was written for 2020.
I read that We has structured the leases through "fuse" companies. If they need to get out of a lease, they let the lease holder go bankrupt and walk away. The landlords will be holding the risk. Anyone looked into this?
Yes that's true, they're held in special purpose vehicles and they only guarantee leases for a short amount of time. They can walk away from them, though in reality this probably just gives them an additional point of leverage if things do really go badly in one of the markets and their space (which is cheaper than most corporate space on a per employee basis) isn't filled.
@@damanamathos sounds to me like we and the landlords will be fighting it out in court and the tenants will be collateral damage, by getting locked out or something. Fun times ahead...
@@Nico-wp6jq unlikely to come to that. Easier for landlords to renegotiate, although before it even goes there WeWork has some benefits from wide geographic diversification, 40%+ enterprise tenants with longer leases, and the fact they save corporates 50% on occupancy per employee. Downturns could be positive for them, apparently they've done ok in weaker markets so far.
What is the closing music?
Harder, better, faster, stronger by daft punk
Loved the daft punk ending!
I knew wework was sus, but the adam leasing building to wework and him personally owning the logo is suuuper sus to the point of fraud.
he's smart to cash out $700M since the company wouldn't exist in 5 years
@@charlech like that's what this whole thing looks like.
What a nightmare, who in their right mind is going to invest in this?
SoftBank
"Get me the Hell out of this stock but you should buy some!".... No "Fake News" here 😂😂 #wework #ipo
This dude called it out years ago.... 🤠
Wework is so fucked up Scott needed to do 2 videos 😱😱😱
oh there will be more than two...
Section4
delightful
Let's look at WeWork from a different point of view. Let's say, that the name should be complete, such as WeWorkForBanks.
Why? Easy. Just analyze the fake recovery of the housing market since 2010. Soon you will find out, that there are millions of homes under disclosure... but the lenders don't act against them. Why? Because that would bring down the market value of their properties. If you throw 3 million estates on the market, the prices will go down like in a illegal tobogan.
Banks tried it all, as you can see. They need the subprimes, they need mortgages... but they cannot get rid off their delinquent base.
This is not only the case for the US. The same in Europe, the same in Asia.
Now... what about creating some companies that could use all these void square meters? Doesn't matter if they cost a lot, they will ALWAYS be cheaper to maintain than delinquent propierties in the millions. So, there companies pop up, who - against all odds - offer space, make some money, but cannot attract enough customers. Why? Because they are limited to the propierties their investors push into their scope. Just have a look at the properties they are using now, and find out that a huge percentage... comes from banks.
Investment banks can have losses. Traditional banks, mortgage related positions... cannot. So, the investment bank flips billions into the farce-company, traditional banks earn some return for the first time in 9 years, their properties get renovated, and... adios WeWork, welcome WeWash... as this is money laundering at its best, completely legal... as long as you haven't the original and secretive agreement found out about.
I mean, if an idiot like me can come to this fast conclusion, bankers wouldn't have let this opportunity go, or reserved it for very critical moments.
Btw, that housing bubble is now like eight times bigger than it was like 12 years ago. Banks are clearly out of cash, worldwide. Looks pretty critical to me, but... I'm not a banker.
Lol.
Using investor dollars to make founders rich, while losing billions for non-founder shareholders.
0:56 wework is evangelion
Israeli military man founded by and loosing money coming from Arabic investors......? Isn't there a deeper issue????
I watched Rick and Morty and I could understand it well despite the high speed they talked. This guy - I can't understand what he is saying unless I put payback to .75.
I have a new youtube hero
i think u meant to say like the Clinton Foundation. but good vid.
Waiting for the Tesla video
well yes. But my wework hosts a party every other day so Im good.
WeCon
Well perhaps Adam plans to buy some cheap buildings when his creation is liquidated during the next downturn. Then he can start the cycle all over again. I’d bet he could find some money center banks to lend him money again.
Please just make this one big video instead. RUclips gives you more ad revenue for >10 minute videos.
If I could invest in WeWork I would. After all we all must donate to Israel.