Searching for WeWork on Google reveals how many NPCs there are out in the world. Almost every article you’ll find from a simple, one-word search query carries the title:
“Why WeWork went wrong”
If’n you’re unfamiliar, WeWork was a big deal back in the day. A really big deal.
When I landed my first “big boy” job that was fully remote long before we thought a lockdown was possible, let alone reality, all my remote co-workers went to a WeWork at least a couple of times per week.
I always got some sense of FOMO from my co-workers working at WeWork. I didn’t care to be surrounded by as many people would work at the co-working space, but the IPAs on draft, the barista behind the coffee bar, and some of the other “millennial candy” they added to the co-working space made me feel like I was missing out—especially back then.
Anyway, WeWork was founded in 2010. And within a decade, yes, by just 2019, their private valuation was the type of the American Tech Dream: From absolutely nada in 2010, WeWork was valued at $47 billion by 2019.
Now, yes, it did go bankrupt within six weeks of being valued at $47 billion.
But believe it or not, that ain’t the most interesting part of the story.
(By the way, I’m writing this fresh off of watching a documentary about it last night called—and the title is worthy of study for anyone interested in copywriting and persuasion: WeWork: Or the Making and Breaking of a $47 Billion Unicorn.)
The reason WeWork was so stupidly overvalued is simple: Adam Neumann, founder and former CEO of WeWork, was a master persuader. And I do mean master in the cult-like sense.
He had somehow fooled the entire world (including WeWorkers who used the co-working space to work, employees who Neumann convinced would be millionaires, investors, media talking heads—the actual entire world) into believing that WeWork wasn’t a real estate investing company, and were instead a tech company.
Since everyone wets their pants over tech companies—and every venture capitalist is on the lookout for “the next Uber or Facebook,”—then, well, the recipe for destruction has already been written.
But here’s the thing…
The documentary I watched had a bend to it. Of course, you’re supposed to hate Neumann. Not only did he elicit cult-like leadership (which is a bit of a gift and a curse), but when he was finally forced to step down as CEO, even after over investing in the company and spending bill-yuns of doll-hairs that he didn't have, he did so to a 10-figure buyout.
10-figures!
And the documentary, not to mention all the hit pieces in the media who feel like they got “got” by Neumann because they did get “got,” seem to miss the most important part of this story:
Yes, Neumann utterly bankrupted the brand… but he also built it.
He had that “it” factor that cult leaders have. And he brainwashed the entire millennial generation into believing that we > me.
Now, I have to be fair here: Part of the reason for all the outrage (besides having a natural gag reflex to the ultra wealthy and successful) is sensible. Neumann built his entire brand off the idea of “we,” but at the end of the day, he chose me.
I’d call that simple human nature because it is. And that’s what irks people even more: You’d think you’d act differently in the same situation until, well, the same situation is reality and not make believe.
But the WeWork brand itself, especially in the early days, is more than worthy of your study.
In fact, the culture that WeWork built, the millennial existential dread and angst they tapped into, and the unadulterated charisma of Adam Neumann is how they grew to be valued at $47 billion—for a company who sells desk space!—in the first place.
In fact, let me share a story that shows how deep the WeWork conditioning went:
Neumann was every bit as revolutionary as Steve Jobs, in many ways. Part of the reason he was able to convince the entire world that WeWork was a tech company instead of a real estate company was because he truly believed it. And he had plans, albeit plans that never truly materialized but plans nonetheless, to transform WeWork from a real estate company to a tech company. He even created an entire WeWork social media site—to network with professionals with similar values—to feed this narrative. But nobody who worked or lived at WeWork used the social media site.
“Wait, did he really just say ‘who worked or lived at WeWork’? What does he mean by lived at WeWork?”
I’ll tell ya, cully - people actually lived at WeWork. Well, technically WeLive, but you get the point.
One of Neumann’s ideas, which is nothing more than an extension of his WeWork’s community-driven mission, is WeLive: A special place where the best WeWorkers had an opportunity to live with other cream-of-the-crop WeWorkers.
And so, they sold apartment spaces. I don’t know how much they charged, but since WeLive only went live in New York City (don’t quote me on that), they weren’t big. In fact, 200 square feet for a room was the exception that proved the rule: Most were 200 square feet or under. I’m sure they charged an arm and a leg too.
But that didn’t matter: Their community mission was so powerful that people happily overpaid for a small apartment. Now, the apartments were very Japanese-esque, they made the most out of a small living space. But still.
WeLive was the most cult-like aspect of WeWork (well, until WeGrow became an idea, which was WeWork’s version of early childhood education). You were shamed and shunned when you left the building or invited a friend from the outside, in. That’s cult behavior 101.
But the impressive part, at least as a marketer and entrepreneur myself, is that people actually lived in WeLive.
The brand reached a level of omnipotence that most brands never enjoy.
This was, of course, the downfall of Neumann (who kept spending his money more and more frivolously).
But you can’t tell me with a straight face that WeWork did nothing right.
This kind of success doesn’t happen to most people. It doesn't even happen to most brands.
And yet, not only did it happen, but it happened with a 30-some year old visionary in Adam Neumann—who also quietly became a billionaire in the process.
Moral of the story?
There are plenty:
For one, study WeWork’s rise and fall.
For two, be aware of cults.
WeWork wasn’t an official cult—but it was as close as you can toe that line without crossing it. Neumann probably even believed in some part of his psyche that he was a cult leader. (He even mentioned becoming president of the world on occasion.)
But it’s said that the smartest among us are actually most likely to fall for the lies of a cult. And you can see the actual human psychology of this play out in real life with the WeWork story. WeWork’s first customers, the people who first helped create the vision of co-working space utopia, were creators. They were freelancers, small business owners, designers, marketers, what have you.
By many accounts, these people were probably some of the smartest from their areas. And yet, they fell for the aggrandized lies of utopia the fastest and the hardest.
For three, learn to spot the nuance in any story—it helps you extract the good and repudiate the bad in a way that’s more real and authentic.
And for four, think bigger.
WeWork’s biggest investor was CEO of SoftBank from Japan, one Masayoshi "Masa" Son.
In a meeting where Masa promised Neumann $4 billion, he told him to think bigger. He had wanted to invest, but he was thinking 10x too small—and it worried Masa.
While this may have been a bastardized, Tech Bro version of a self-help fan-fic, when Neumann began thinking “10x” bigger (which in this story, meant turning WeWork into a global tech brand despite not being a tech company), is one of the reasons Neumann left the company a billionaire.
Yes, even after sabotaging a $47 billion valuation and bringing it to $0 in just six weeks time.
Alright, onto business:
Thinking bigger in your business might be as simple as hitting reply, chatting with me about your email marketing strategy, and, if I sound like the man to solve your problems (deliverability, revenue, or otherwise), deciding to partner with me.
Ball’s in your court.
John
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