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- WeWork CEO Adam Neumann has led the company since cofounding it in 2010. It is scheduled to go public under the holding company The We Company in September.
- Since the release of We’s S-1 prospectus in August, Neumann’s unusual relationship to the company had undergone intense scrutiny.
- Neumann controls a private company that owns a majority stake in The We Company and has used it to sell the "We" name to The We Company for nearly $6 million. He also previously rented property to his company and borrowed millions in loans from it.
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The coworking space giant WeWork, under its parent company The We Company, is set to go public next month in one of the biggest and most polarizing IPOs of this year.
Since releasing its S-1 prospectus in August, analysts have not only been scrutinizing We’s financials, but also its charismatic founder and CEO, Adam Neumann.
Neumann cofounded WeWork in 2010 and has led it to a valuation of $47 billion with 466,000 members across 28 countries.
Along the way, Neumann has been a landlord to and a borrower from his company. He’s controlled a separate private company, WE Holdings LLC, which as the S-1 revealed, sold the copyright to the "We" name to this company about to go public, for almost $6 million. The corporate structure is also quite complex, though a key takeaway is that it grants Neumann maximum control.
As the IPO approaches, we’ve collected some of the highly unusual ways Neumann has made millions, and will continue to make if the IPO is successful, from WeWork.
He controls other companies that give him the majority ownership of the We Company.
Neumann and his team decided to go with a relatively unusual Up-C structure (an upstream C-corporation) that makes the We Company a holding company. Neumann and his cofounder Miguel McKelvey have a separate private company called WE Holdings LLC that is the largest shareholder in the We Company, and Neumann has 100% ownership of the voting shares.
WE Holdings owns more than 2.4 million shares of Class A common stock and 111.9 million shares of Class B common stock, the latter coming with 20 votes per share.
The S-1 showed Neumann has separate companies called Anincentco1 LLC, Anincentco2 LLC, and Anincentco3 LLC that own shares in the We Company.
And then Neumann and the other eight directors own shares in the We Company Partnership, but Neumann has sole ownership of its 1.06 million Class C shares.
He sold the rights to the "We" name to The We Company for $5.9 million.
When it was time for the We Company to incorporate, it had to buy rights to its name — from Neumann.
Neumann had previously purchased the "We" name for WE Holdings LLC, and he sold it to the company he planned to go public, for $5.9 million.
When Business Insider’s Julie Bort asked the We Company earlier this week about the arrangement, a representative declined to comment.
He cashed out $700 million ahead of the IPO.
Michael Kovac/Getty Images for WeWork
Neumann cashed out more than $700 million through stock sales and debt ahead of the We Company’s IPO, the Wall Street Journal reported last month.
Unnamed sources close to Neumann told the Journal he did so because he’s bullish on the stock, but it’s an unusually large move for a founder ahead of an IPO, rather than following it.
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