I’ve been following the WeWork story for the last few months (see here and here). In August, the company, in a quarterly filing, warned of doubt the business could continue. Today it officially filed for Chapter 11 bankruptcy, with $19 billion in liabilities and assets worth $15 billion listed in its filing.
Chapter 11 bankruptcy doesn’t mean the company will cease operations. Chapter 11 of the U.S. Bankruptcy Code allows a company to reorganize and renegotiate its debts with creditors while it continues to operate. The hope is that the company will be able to exit bankruptcy with a more reasonable debt load.
Today marks another low point for a well-known, venture capital–backed company that raised over $22 billion in equity and debt financing over the years and was valued at $47 billion as recently as 2019.
I’m curious to see how this bankruptcy process will play out and what the company will look like if it successfully exits bankruptcy.