As WeWork contemplates an IPO at a far lower valuation that previously expected, its biggest backer — SoftBank — is bracing for a potentially staggering loss.
As WeWork contemplates listing on the public markets at a far lower valuation than previously expected, its biggest backer — Japan’s SoftBank Group Corp. — is bracing for a potentially staggering loss, a stark reminder of the risks of an investing strategy that inflated startup valuations across Silicon Valley.analyst call Wednesday
Now, SoftBank’s big bet may already be turning sour as WeWork mulls an IPO that would peg its worth at Because the Vision Fund is so exposed to WeWork, it will play a substantial role in compensation for employees of the fund. People at the Vision Fund are not paid on a deal-by-deal basis, as with some other venture firms. Vision Fund employees, including high-profile bankers and investors, receive base salaries and bonuses, but they get payouts only when profits are booked. They are also on the hook for, facing clawbacks of 20% and above for some senior staff, and 7% for more junior employees.
Sometimes, though, the investors he comes into conflict with are his own. The Vision Fund’s backers, particularly Saudi Arabia’s Public Investment Fund and Abu Dhabi’s Mubadala Investment Co., early this year scuttled a $16-billion investment in WeWork that Son had championed — something Son alluded to in anin March. SoftBank ended up making only a $2-billion investment separately from the Vision Fund.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
WeWork Slashes IPO Expectations as Investors BalkThe controversial startup, which was previously valued at $47 billion, could now be targeting as little as $20 billion for its initial public offering.
Read more »
WeWork is dramatically slashing its IPO valuation to less than $25 billion because of weak demandEven at a $25 billion valuation, demand for WeWork is weak, people familiar with the matter say. It last raised money at a $47 billion valuation.
Read more »
WeWork considers slashing IPO valuation amid pushback: sourcesWeWork owner The We Company is considering slashing the valuation it will seek in an initial public offering (IPO) at a little over $20 billion
Read more »
WSJ News Exclusive | WeWork Weighs Slashing Valuation by More Than Half Amid IPO SkepticismWeWork parent weighs slashing its valuation roughly in half to around $20 billion amid IPO skepticism, say people familiar with the matter
Read more »