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WeWork's upcoming IPO will prove whether SoftBank was right to pour billions of dollars into a coworking startup with sky-high ambitions, but SoftBank won't be alone.
The We Company, WeWork's new parent, has officially filed paperwork with the Securities and Exchange Commission to go public, although further details remain scarce. Just how much interest it will garner, and at what price, is the subject of hot debate.
SoftBank's latest investment in The We Company, a $6B equity infusion from its venture arm called SoftBank Vision Fund, valued the startup at $47B. The capital has also sustained WeWork's prodigious spending; even with $1.82B in revenue last year, it still posted net losses of $1.9B. Public companies tend to have less leeway to post such losses, leading to speculation over whether SoftBank can recoup its investment from the initial public offering.
Though it is far and away the biggest investor in The We Company, SoftBank is not the only big name whose capital hinges on the outcome of the eventual IPO. JPMorgan Chase, the company that WeWork passed as New York's largest office tenant, also owns a stake, as does Harvard Management Co., the entity in charge of investing the Ivy League university's legendary endowment, the Seattle Business Journal reports.
A trio of Chinese capital sources also have stakes in The We Company, according to the SBJ: hospitality company Jin Jiang International Holdings, private equity fund Hony Capital and conglomerate Legend Holdings. Joining them are T. Rowe Price, Goldman Sachs, Fidelity and Benchmark, Tech Crunch reports.
The We Company hopes to entice public investors by showcasing its rapid pace of diversification as symbolized by its top-down rebrand. In addition to its real estate portfolio, the company has acquired a host of tech companies and branched out into retail, housing and early education.
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