Technology

The life and career rise of Adam Neumann, the billionaire WeWork founder and CEO taking his company public

Adam Neumann, CEO of WeWork

Adam Neumann has run WeWork from when it got its start nearly 10 years ago to now, as it files for an IPO.

The 40-year-old Israeli-born Neumann is worth an estimated $4.1 billion, and has come a long way from the shoe-box-sized New York city apartment he first lived in in the early 2000s.

His company, last valued at $47 billion, filed its public S-1 IPO paperwork on Wednesday morning, revealing spiraling losses, with the company posting a net loss of $1.6 billion in 2018 on revenue of $1.8 billion.

Here’s everything you need to know about Adam Neumann, the WeWork cofounder and CEO:

SEE ALSO: WeWork, the $47 billion co-working company, is gearing up for a huge IPO this year. Here’s everything we know about what’s going on.

Adam Neumann, 40, was born is Israel in 1979. His parents got divorced when he was 7, and he moved around a lot as a child with his mother — he reportedly lived in 13 different homes by the time he was 22.

Source: New York Magazine

As a child, Neumann lived for some time on an Israeli kibbutz, one of the collective community settlement across the country. Neumann attended school near the Gaza Strip while his mother worked as a doctor at a nearby hospital.

Source: Haaretz

Neumann is severely dyslexic, and couldn’t read or write until he was in third grade.

Source: Forbes

As is customary for Israeli citizens, Neumann served in the Israel Defense Forces after grade school. He served in the navy for five years, although only three years of service is required. “That’s where I got to know a lot of my best friends,” Neumann told Haaretz in 2017.

Source: Haaretz

After leaving the IDF, Neumann moved in 2001 to New York City, where he lived in a Tribeca apartment with his sister Adi. He spent his early days in New York going to clubs and “hitting on every girl in the city,” he said in a commencement speech in 2017.

Source: New York Magazine

Neumann enrolled at city school Baruch College in January 2002 and majored in business. He said he thought of the concept of WeLive, WeWork’s communal living business, for a school entrepreneurship competition. However, the idea was killed in the competition’s second round, because a professor didn’t think Neumann would be able to raise enough money “to change the way people live.”

Sources: New York Magazine, TechCrunch

Neumann dropped out from college just four credits shy of graduating. He ultimately finished his degree 15 years later in 2017 after completing a four-month long independent study, and delivered the commencement speech for Baruch College’s graduating class.

Sources: TechCrunch, Business Insider

While in college, Neumann met his now-wife, Rebekah Paltrow Neumann, who is the cousin of actress Gwyneth Paltrow. The pair got married in 2009, and now have five children together.

Source: Observer, Real Deal

On their first date, Paltrow Neumann called out the WeWork CEO for being “full of s—.” Neumann credits his wife for getting him to stop smoking, and for telling him to pursue his passions instead of dreams to be rich.

Sources: Business Insider, Business Insider

Paltrow Neumann serves as the founder and CEO of WeGrow, the business under the WeWork company umbrella that operates an elementary school in New York. She was a WeWork founding partner, when she learned there’s “no job too big or too small for each person.”

Sources: Coveteur, WeGrow

Read more: WeWork is just one of the businesses owned by a $47 billion company that could reveal its IPO paperwork any day now — check out the full list

While Neumann was at college, he worked on two business ventures: a failed idea for collapsible heeled shoe, and baby clothes with built-in knee-pads called Krawlers. He dropped out to pursue the second idea, and developed it into a baby-clothing company called Egg Baby in 2006.

Sources: Forbes, TechCrunch

Egg Baby is still around today as a luxury baby clothing company headed up by clothes designer Suzan Lazar. Neumann is no longer involved in the day-to-day operations of Egg Baby, whose children’s clothing is sold at department stores around the world.

Sources: Forbes, TechCrunch

Soon after launching Egg Baby, Neumann met WeWork cofounder Miguel McKelvey through a mutual friend. The two reportedly bonded over their backgrounds and competitive streaks, and McKelvey convinced Neumann to move Egg Baby offices to the same building he was working out of in Brooklyn.

Source: Forbes, New York Magazine

Soon after, the two developed the idea for WeWork after brainstorming an idea for renting out empty office space to other companies. In 2008, they convinced their building’s landlord to let them rent out a floor in a nearby Brooklyn building, and an earth-friendly co-working company called Green Desk was born.

Sources: Forbes, New York Magazine

However, McKelvey and Neumann decided to go off on their own. They sold off their share of Green Desk to their landlord for $3 million, and opened their first WeWork space in 2010 in New York’s Little Italy neighborhood.

Sources: Forbes, New York Magazine

Under Neumann as CEO, WeWork has expanded to provide co-working desk space in commercial buildings in more than 120 cities in nearly 40 countries. The company was last valued at $47 billion.

Sources: Business Insider, Forbes

One of WeWork’s biggest investors is the Japanese investment firm SoftBank, who has invested more than $10 billion in the company. Neumann has told Business Insider about his close relationship with SoftBank CEO Masayoshi Son, who he calls “Yoda.”

Source: Business Insider

Neumann himself has an estimated net worth of $4.1 billion. Since founding WeWork, Neumann has spent over $80 million on five homes, including two properties in New York City and one home in the Hamptons. In 2018, he reportedly purchased a 13,000-square-foot home in the San Francisco area, complete with a guitar-shaped room, worth $21 million.

Sources: Wall Street Journal, Business Insider

Neumann has also invested in a number of startups, both by himself and on behalf of WeWork. Through WeWork, his niche-interest investments include a wave-pool startup and a superfood startup, which sells things like “performance mushrooms,” powdered coconut water infused with beets and turmeric, and highly caffeinated coffee.

Source: Business Insider

Neumann is WeWork’s largest single shareholder. However, in recent years, he’s cashed out some of his stake and also taken out loans. In total, Neumann’s sales and debt transactions have reportedly totaled $700 million.

Source: Business Insider

The company — which rebranded to the We Company in January — publicly filed for an IPO on August 14, 2019. The IPO filing gave the public its best view yet at the company’s money-losing financials.

Business Insider’s Troy Wolverton and Shona Ghosh write in their coverage of WeWork’s S-1 that:

“The numbers show spiraling losses over the last three years:

  • During the year December 31, 2016, WeWork lost $429 million on $436 million in revenue.
  • The following year that loss increased to $890 million on $886 million in revenue.
  • And for the full year 2018, WeWork lost $1.6 billion on $1.8 billion in revenue.
  • For the first six months of 2019, the firm posted a loss of $690 million on $1.5 billion in revenue.

We Co. will be the most highly valued startup to go public since Uber in May.”

 

Source: Business Insider

 



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