This week WeWork included a warning in its quarterly results report:

[A]s a result of the Company’s losses and projected cash needs, combined with increased member churn and current liquidity levels, substantial doubt exists about the Company’s ability to continue as a going concern.

Translation: WeWork is struggling to survive. It may or may not make it through a rough patch. To turn things around over the next 12 months, management has a plan that includes the following elements:

• Reducing rent by renegotiating lease terms
• Increasing new sales and reducing churn
• Scrutinizing expenses and capital expenditures
• Raising capital by taking on debt, selling equity, or selling assets

Crunchbase says that the company has raised over $22 billion in equity and debt financing over the years. Its valuation peaked in 2019, when it raised a reported $6 billion from Softbank at a $47 billion valuation. As of Wednesday, August 9, 2023, its public market capitalization (i.e., valuation) is $272 million. Dropping from $47 billion to $272 million is about a 99.5% reduction in valuation in roughly four years.

I’m not sure what the future holds for the company, but its fall from grace is stunning. I’m curious to see what impact WeWork’s struggles will have on start-ups who depend on it for office space and on the owners of office buildings that house WeWork’s locations.