NEW YORK (AP) – WeWork said Friday that it will stand apart from several side businesses and cut jobs as part of a 90-day plan to turn around its abandoned bid to sell shares on Wall Street.
The office-sharing company will dispose of five non-core businesses, including Meetup, the online community organizer that WeWork purchased in 2017, according to a recently released presentation that was first shared privately with investors in October. It will also sell its stake in the women's cooperative company The Wing.
An unspecified number of job cuts will be directed at administrative staff, those working in growth-related positions and those at ventures expect the company to reset. Terminations will not include "community teams" based on their shared office pages.
The document shows that WeWork is still working to grow rapidly when the initial stock offering crashed in September, a crisis that left the company on the brink of bankruptcy and forced the eradication of co-founder Adam Neumann.
In the third quarter of 2019, WeWork set records for 108,000 desks in newly built shared offices, leaving it now with significantly more room to fill even though it is pursuing a painful restructuring. The newly added desks led to a slight dip in average occupancy to 80%, compared to 83% last quarter.
New York-based WeWork now has 580,000 members spread across 600 locations in 122 cities in 32 countries. The company said that 43% of its members are larger companies with more than 500 employees. The future strategy will focus on strengthening the clientele, which commits to longer leases that provide a smoother revenue stream.
WeWorks planned stock market collapse after investors fell on losses that grew to nearly $ 2 billion years and according to the company's business model. which gave no clear path to profitability.
It escaped possible bankruptcy with a $ 9.5 billion rescue from the Japanese technology conglomerate Softbank, which took an 80% stake in the company. About $ 3 billion went to buy shares from stakeholders including co-founder Neumann.
WeWork released a plan to focus on its core office rental business and away from Neumann's widespread vision, which includes investing in Spanish wave pool startup Wavegarden, a clear reflection of the love of surfing. The share in Wavegarden is now for sale.
In an apparent reference to Neumann, the company stated that it is moving away from a "founder-led" leadership and toward "proven leaders in member-focused, subscription-based businesses."