For an organization dedicated to community, WeWork has handed a stunning amount of power to CEO Adam Neumann.
Share to twitterIf WeWork CEO Adam Neumann does not contribute at least $1 billion to charitable causes in ten years he will lose some of his super-voting rights.For an organization dedicated to community, WeWork has handed a stunning amount of control—and cash—to one person.shows that chief executive Adam Neumann will hold at least 50% of shareholder voting rights after the shared-office company completes a public offering later this year.
It’s not an uncommon arrangement for tech companies with founders who remain active, including Facebook and Amazon. The trouble is that not everyone believes WeWork is a tech company, although it is valued as such because of its meteoric growth rate. “Usually a related-party transaction is done to give someone an advantage,” says Drew Bernstein, partner at public accounting firm Marcum Bernstein & Pinchuk. “What avoids the appearance of conflict of interest is not having the transaction in the first place.”
This arrangement garnered a lot of attention before the S-1 was released, although some experts now say the relatively modest scale of the real estate entanglement makes it less of a concern looking forward. As part of yesterday’s filing, WeWork laid out a plan to transfer management of the properties to the company, including a purchase option.
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