WeWork reportedly prepared to fire 2,000 workers
WeWork is expected to lay off at least 2,000 people as early as this week, the Guardian reported on Tuesday.
The layoffs, which amounted to about 13% of the work-space sharing firm's staff, were expected be the just the first of many more cuts. WeWork employees told the Guardian that as many as 15,000 workers could be let go.
Staff told The Guardian little or no work was getting done as workers prepared for the layoffs and new projects were put on hold.
One worker, who spoke anonymously for fear of reprisals, said: "The atmosphere is toxic. A lot of people worked so hard for this company. We thought we were in on something really big."
In online chats on WeWork’s Slack channel, staff shared memes about co-founder Adam Neumann, who for many was the man to blame for the company’s fall.
The news came as the company was trying to cut costs and remain afloat after halted plans to go public in September.
Ahead of its much-anticipated IPO in August, which later fell through, the company revealed a massive $900.0m loss for the first six months of 2019, eliciting concerns over its corporate governance.
There was also a degree of uncertainty surrounding the company as SoftBank, one of its main investors, who was reported to be readying a financing package to take control of the company, reported the Wall Street Journal on Monday, aggravating the tensions between former CEO Adam Neumann and Softbank chief Masayoshi Son.
In 2018, WeWork lost $1.6bn and had $2.5bn in cash as of 30 June. According to analysts at Sanford C Bernstein & Co, the company could run out of money after the first quarter of 2020.