WeWork, which replaced its controversial Israeli chief executive last week, announced Monday that it will withdraw a plan to go public but will revive an initial public offering down the road.
The company’s co-CEOs Artie Minson and Sebastian Gunningham said in a statement they decided to “postpone our IPO to focus on our core business, the fundamentals of which remain strong.”
But they signaled they still intend to take the company public, saying “We have every intention to operate WeWork as a public company and look forward to revisiting the public equity markets in the future.”
The announcement comes six days after a shakeup atop the office sharing business that led to Minson’s and Gunningham’s appointments after controversial co-founder Adam Neumann stepped down.
The charismatic Neumann was credited with growing WeWork, founded in 2010, into a real estate giant with operations in 111 cities in 29 countries.
However, the company faced questions over its prospects for achieving profitability, and Neumann came under scrutiny for perceived self-dealing between his personal assets and WeWork and over unconventional personal conduct, including drug use.
Before last week’s executive shakeup, WeWork’s bankers were eyeing a much smaller IPO than initially envisioned. It was originally valued at $47 billion, but that figure has plummeted to some $15 billion as investors have opened the company’s books and raised questions about how it is run.
Skepticism about WeWork’s business model has mounted in recent weeks after it delayed a planned initial public offering. The company’s revenue has risen sharply, reaching $1.8 billion in 2018. But its losses have mounted almost as quickly, climbing to $1.6 billion last year.
A Wall Street Journal profile published earlier in September portrayed Neumann and his wife as eccentric executives who made rash decisions. According to the profile, Neumann has plans to become prime minister of Israel and the world’s first trillionaire.
The 40-year-old Israeli grew up on a kibbutz and in the US, and served as an officer in the Israeli navy.