WeWork expects positive cash flow by next year

NEW YORK • Troubled office-sharing start-up WeWork is set to have a positive cash flow by next year, its executive chairman told the Financial Times on Sunday, hailing a turnaround for the high-profile company.

"Everybody thought WeWork was mission impossible. (That we had) zero chance. And now, a year from now, you are going to see WeWork basically be a profitable venture with an incredible diversity of assets," Mr Marcelo Claure said.

Mr Claure told the Financial Times that the New York-based company's revival was ahead of schedule after cutting its workforce by 8,000, renegotiating leases and selling assets.

He also cited strong demand for flexible workspace since the start of the coronavirus pandemic, with companies seeking small, satellite offices near where employees live.

WeWork was once hailed as a dazzling unicorn valued at US$47 billion (S$65 billion) and was headed for a high-profile initial public offering last year.

It ultimately collapsed due to concerns over its financial performance and corporate governance and its valuation was reduced to a tiny fraction of what it once was.

SoftBank Group, WeWork's biggest shareholder, took control of the company last year and ousted Mr Adam Neumann as chief executive officer.

The two parties are now locked in a legal battle after the Japanese company scrapped a US$3 billion deal to buy stock from him and other shareholders as part of the bailout.

Some tenants had refused to pay rent during Covid-19 shutdowns, but Mr Claure said Mastercard, ByteDance, Microsoft and Citigroup had all recently signed lease deals with WeWork.

AGENCE FRANCE-PRESSE, BLOOMBERG