Adam Neumann Loses His $185M Consulting Deal With WeWork
Another connection between Adam Neumann and the company he co-founded has been severed.
The $185M consulting contract Neumann had signed with WeWork as part of his agreement to leave the company last year is no longer in place, WeWork Executive Chairman Marcelo Claure said on an online Wall Street Journal event on Monday.
“I think Adam may have violated some of the parts of the consulting agreement, so that’s no longer in effect,” Claure said, according to the WSJ.
The agreement was part of the deal struck between Neumann and WeWork's board of directors, the rest of which included a purchase of $1B in WeWork stock Neumann owned and a refinancing of $500M in personal debt.
WeWork's board of directors has been overseen by SoftBank Group after a series of capital investments that culminated in an October 2019 takeover valuing the company at $8B. The $3B investment, considered by many to be a bailout to keep the company solvent after its failed initial public offering the previous month, sent WeWork's valuation spiraling and precipitated Neumann's forced exit.
In the time since Neumann's ouster, Claure and SoftBank sought ways to reduce the size of its bailout even as it began cost-cutting measures meant to drag WeWork to its first-ever profitability. Claure said during the Monday event that the company would hit its goal of profitability at some point next year, the WSJ reports.
Neumann's consulting deal included language barring him from competing with WeWork, though Claure did not specify if that was the reason for the deal's termination. Neumann's family wealth office invested $30M in multifamily services company Hello Alfred earlier this month.