- Soon-to-be-public WeWork, the coworking company that leases office space to other startups, is reportedly targeting a $10 billion valuation for its public debut.
- The valuation is significantly lower than the $47 billion valuation it once commanded and comes as WeWork's team scrambles to get investors on board with its heady IPO.
- Since it was founded in 2011, WeWork has raised a whopping $8.39 billion in private funding from backers like SoftBank's $100 billion Vision Fund.
- See WeWork's full valuation history based on Pitchbook data.
- Click here for more BI Prime stories.
WeWork's public offering is off to a rocky start, and it hasn't even listed its shares yet.
Concerns around the coworking startup's governance, real estate holdings, succession plan, employee retention, and questionable patent purchases have spooked potential investors. WeWork has amended its SEC filings twice already to address several of those concerns, but it might not be enough.
According to a Reuters report, WeWork will target a $10 billion valuation for its IPO, drastically lower than the $47 billion valuation it last fetched in private markets. A $10 billion public valuation would be only slightly above the total amount of funding WeWork has taken in as a private company: about $8.39 billion since 2011, according to Pitchbook data.
It's a striking turn of events for WeWork, which has experienced a meteoric rise since its founding in 2010 by CEO Adam Neumann, his wife Rebekah Neumann, and Miguel McKelvey. The New York-based startup leases office space to other startups and has expanded to more than 100 cities in 29 countries — a turbo-charged expansion plan that has required WeWork to continually raise capital as it burns through billions of dollars.
Until now, even the savviest investors, from venture capital firms to mutual funds to Japan's SoftBank, were eager to pump money into WeWork, driving up its stratospheric valuation. But in this case, what goes up appears to be coming down.
Here's the definitive history of WeWork's valuation ahead of its much anticipated public offering:
October 2011: $1 million seed round, undisclosed valuation
WeWork's $1 million seed round in October 2011 was led by DAG Ventures and came with an undisclosed valuation.
July 2012: $17 million Series A, $97 million valuation
Less than a year after its seed round, WeWork raised its Series A in July 2012. The $17 million round, which valued the startup at $97 million, was led by an undisclosed group of investors.
May 2013: $40 million Series B, $440 million valuation
WeWork also did not publicly disclose investors for its $40 million Series B in May 2013. The round valued the burgeoning startup at $440 million post-money.
February 2014: $150 million Series C, $1.49 billion valuation
The coworking startup officially crossed into unicorn territory in February 2014 with its $150 million Series C. The round valued the company at $1.49 billion and included JP Morgan Chase, Harvard Management, Benchmark Capital, and Mort Zuckerman.
October 2014: $355 million Series D, $5 billion valuation
Within ten months of its Series C, WeWork raised another $355 million in Series D funding from T. Rowe Price, Wellington Management and Goldman Sachs, in addition to follow-on funding from the Series C investors. The round valued WeWork at $5 billion.
June 2015: $434 million Series E, $10.23 billion valuation
By June 2015, WeWork had already moved on to late-stage private funding with its $433.93 million Series E from Fidelity. The other investors in the round were not publicly disclosed, but the round valued the startup at $10.23 billion.
April 2016: Debt financing, valuation unchanged
WeWork pursued its first round of debt financing in April 2016 with Wells Fargo. The undisclosed amount of financing did not alter the startup's valuation from its most recent venture round in June 2015.
October 2016: $690 million Series F, $16.9 billion valuation
The debt financing in early 2016 bought WeWork time to finalize its $690 million Series F venture round by October 2016. The round valued the company at $16.9 billion and was led by Legend Holdings and Hony Capital. All existing public investors also participated in the round.
August 2017: Insider stock sales to SoftBank, valuation unchanged
An undisclosed group of investors sold $1.3 billion worth of WeWork shares to SoftBank's massive Vision Fund. The transaction did not alter WeWork's valuation.
August 2017: $1.7 billion Series G, $21.2 billion valuation
SoftBank also led WeWork's $1.7 billion Series G funding round that same month. The round valued the now 7-year-old startup at $21.2 billion, and brought on Catalyst Investors, Alpha JWC Ventures, Syren Capital Advisors, Primary Venture Partners and StraightPath Venture Partners as investors.
January 2019: $1 billion insider stock sales to SoftBank, $20 billion valuation
Softbank purchased another $1 billion worth of WeWork shares in January 2019 from undisclosed investors and WeWork employees. At an even $20 billion valuation, the round gave WeWork a lower post-money valuation but a higher pre-money valuation than the Series G funding round 18 months earlier.
January 2019: $5 billion direct investment from SoftBank, $47 billion valuation
SoftBank's purchase of insider shares was completed in connection with a $5 billion primary investment into WeWork that valued the company at $47 billion, more than double its previous valuation, according to Pitchbook.
The round included $1 billion in convertible debt and a $3 billion warrant agreement, according to Pitchbook data.
May 2019: $110 million debt financing, valuation unchanged
WeWork got $110 million in debt financing from Citizens Bank and Pacific West Bank in May 2019. The financing did not change the startup's previous $47 billion valuation.
August 2019: WeWork files IPO paperwork
WeWork indicated in its S-1 filing that it planned to raise $1 billion in its IPO, though that number was likely a placeholder. The company did not provide details on the numbers of shares it wanted to sell or the price and valuation it was seeking.
September 2019: WeWork seeks reduced, $10 billion to $12 billion valuation for IPO
According to a Reuters report on Friday, WeWork is now seeking to IPO at a valuation of between $10 billion and $12 billion — knocking the company's valuation down to where it was in 2015. It is not clear if WeWork hopes to raise a lower amount during its public debut, or if SoftBank will make back the nearly $9 billion it publicly invested in the company.