When the 2019 IPO imploded, Neumann was ousted and a leadership reshuffle swiftly followed.
The startup did eventually go public in 2021, though it couldn’t quite shake off the pandemic dust that had settled in empty offices and real estate across the U.S. in its 649 global locations.
Brian Wieser, principal analyst and owner of consultancy Madison and Wall, believes WeWork’s fall has been less about the brand itself and more about its operational woes: “WeWork was losing hundreds of millions each year on an operating basis and needed to deploy hundreds of millions more in ongoing investments in their space,” he said.
Blank spaces
Marisa Mulvihill, partner and head of brand and activation at growth strategy consultancy Prophet, argues WeWork’s lack of a cohesive marketing plan, coupled with its determination to pitch itself as a tech business, did play a part in its downfall.
WeWork “went awry,” she says, in its early days when it created a purpose that strayed too far from its core business. She points to Neumann’s description of We-owned companies as being designed “to elevate the world’s consciousness.”
“That might be inspiring, but it didn’t feel relevant or actionable for the business they were in, which was renting office space,” Mulvihill said.
One former senior WeWork employee, with knowledge of its early marketing priorities, revealed the structure of the business simply wasn’t set up to handle sophisticated marketing campaigns. “It was growth at all costs, which meant give everybody deals, do all these things. It wasn’t even about the money, it was about filling up space,” they told Adweek.
The former staffer claimed, during the company’s early stages, that Neumann heavily encouraged brand marketing strategies, to the detriment of performance marketing and driving conversions. At this time, WeWork’s marketing team was not centrally managed, they said, resulting in regional silos that prevented data sharing or any consistent global strategy.
“It was very, very difficult to figure out what was working and what was not, because there was no incentive for those [regional] teams to actually share that information,” the source said. “There was a constant pull and push within WeWork to either become centralized or become regionalized.”
After the failed IPO, the source alleged that regional marketing teams had been sharing inaccurate results. They declined to share specifics, and said the regional teams weren’t necessarily to blame. Instead, they pointed to the broken marketing infrastructure, and pressure from Neumann. “I think that there was always a very strong desire to make sure that everything was great for Adam. He didn’t react well to poor numbers. There was a lot of winging it,” the source added.
