Inside the $47 Billion WeWork Con

L isten up, ambitious young people: Master these catchphrases and you, too, can become a billionaire. Repeat after me: “It’s based on community.” “Our mission is to empower the world through collaboration.” “Good morning. Let’s build the largest networking community on the planet.” If you can come up with a new way of saying, “We’re going to change the world,” have your buckets ready because it’ll be about to rain money. Try, “We will expand the bounds of human possibility through delivering pizza over the Internet” or maybe “We will redefine what it means to be neighbors by mowing lawns over the Internet.” Come to think of it, maybe leave out the “over the Internet” part; it’s kind of a given.

An Israeli-born megalomaniac named Adam Neumann said stuff like this and became a billionaire by renting out desks. The cult he created is the subject of Jed Rothstein’s dizzying and delightful new Hulu documentary WeWork: Or the Making and Breaking of a $47 Billion Unicorn. Neumann (who didn’t participate in the doc, although it includes a lot of archival footage of him from corporate videos and interviews) co-founded WeWork, the colossally overvalued “tech unicorn” that bought up long-term leases in office buildings and redecorated and subdivided them for short-term tenants, thus taking on a lot of risk and burning through piles of money. Neumann cashed out of the company in 2019, as investors grew first skeptical, then furious, with what he’d done, e.g., buying up buildings that he would then rent back to the firm and paying himself $5.9 million out of the company till for use of the term “We” after he had it trademarked. (He later repaid the company.) Thanks to Neumann, WeWork became the Fyre Festival of real-estate companies.

Neumann has long, luscious, shiny, I-could-play-guitar-for-Aerosmith hair, a blinding smile, and a cool Israeli accent. He’s six-and-a-half feet tall, and he uses gongs in his presentations. He’s basically a teen idol for venture capitalists, who collectively tossed their underwear at him as he sang insipid hits. He’s one of those guys who pats his heart and punches the air and shouts motivational-speaker clichés at bedazzled rooms full of gullible young idiots: “The only thing that stands in the way of achieving anything you want is just you.” No industry, no matter how numbers-focused, can resist the talismanic power of a true B.S. artist, and this guy was the Leonardo of claptrap. “He’s really, really — he’s really friendly!” remarks a former employee interviewed in the film. Among his goals was to become president of the world.

Neumann’s first get-rich-quick idea was kneepads for babies, until he hit on the more saleable notion of flipping office space to small businesses, using foosball tables and free beer as enticements. WeWork eventually became the largest lessee of office space in Manhattan, but as it grew, its financial statements began to resemble science fiction. NYU business professor Scott Galloway read the company’s S-1 financial statement and likened it to a novel written by someone who was ’shrooming.

Hilarious company videos provide a glimpse into how Neumann created something that looked a little like a cult. Then he brought on his hippie-dippie yoga-teacher wife Rebekah to be his co-visionary, and it suddenly looked a lot like a cult. At mass-brainwashing sessions, she would admonish the WeWork family “to feel an energy of unity, where I am you and you are me, and we all are we.” In a TV interview she proposed to “elevate the world’s consciousness . . . specifically through unleashing human superpowers.” She branched the company out into day care and private schooling (“WeGrow”), because what is a cult without youth indoctrination? Her husband made preposterous statements such as, “We could wake up someday and say we want to solve the problem of children without parents in this world. We can win and do it within two years.” This kind of flabberjabber made the Neumanns’ delirious acolytes cheer, sometimes holding up signs reading “We Not Me.” The company called some of its officers “C-We-O’s.” Get it?

Neumann understood perfectly how to exploit young people who, beneath a veneer of urban sophistication, are so many atomized souls craving community. What better way to seize hold of their imaginations than via a collectivist utopia? Some of these people would move to Pyongyang if you promised them a smoothie bar and one month’s advance access to new Apple gadgets. To extend the bubble, WeWork even had a residential branch — WeLive — that stuffed Millennials into 200-square-foot apartments that amounted to human filing cabinets. One disabused former resident says that the place was so creepy and programmed that he lost all of his friends from the outside world. When executives came by, the kidults in residence would be ordered to mingle in groovy common areas for show, like a Potemkin Friends.

Neumann has a classic tell: Whenever he says “definitely” he’s about to say something that isn’t true, as in, “So, definitely not a real-estate company, we are a community of creators. We create an environment for entrepreneurs and freelancers. We leverage technology to connect people.” Er, by flipping real estate? A company lawyer compares Neumann to “one of these spiritual or religious people who think they can cure, like, the plague by touching your head.” The doc presents such Moonies-meet-Oprah scenes as Neumann roaming the aisles at his presentations saying, “You’re a creator! And you’re a creator! And I know you’re a creator!”

Flattering the audience is a critical skill. Neumann would say, “If you take the ‘me’ and you flip it, and you get the ‘we,’ you understand that we’re about to change the way people work and the way people live but more importantly, change the world.” Sure, buddy, let’s reinvent community, and please pass the bong.

When WeWork’s principal backer, Japan’s SoftBank, nixed a planned $20 billion capital infusion, any investor with ears could hear the theme from Jaws, but Neumann rolled out another specialist in the world of make-believe, actor Ashton Kutcher, to make his case. Kutcher, who got lucky with a bet on Uber and consequently fancies himself a savvy investor, is seen telling a TV interviewer, “The notion that anybody is projecting that they [SoftBank] don’t have confidence in the company, I think, is crazy.” Neumann promised that the company had plenty of money to run for four or five years. But as a business journalist explains to Rothstein, “Adam was saying things that were completely false.” One of his accounting innovations was “community-adjusted” profit, meaning the kind that ignores lots of expenses.

Pursued by investors with pitchforks, Neumann left the company in 2019 as a planned IPO collapsed. He is now worth a mere $750 million. He has yet to be held to account, but perhaps the story isn’t over yet. Neumann loved to recount how, when he met his future wife, she initially told him, “You have a lot of potential but right now you are full of sh**.” He related this detail so many times, to so many audiences, that it became a kind of compulsion. It wasn’t enough for him to get rich on an illusory business model; he also had to rub people’s noses in the thing that he was full of.