Who doesn’t love to see a tycoon ruined? Who doesn’t love the tale of a proud titan laid low by his own flaws and by the gods, or by their current equivalent, the markets? In America, where we moralise our money and monetise our morals, fat cats who go bust tend to be viewed as cautionary figures, singular exemplars of malfeasance, not routine casualties of the fickle system that exalted them in the first place.
The subject of Billion Dollar Loser, Reeves Wiedeman’s indefatigable, scrupulous account of the dubious co-working-space company WeWork, is Adam Neumann — the co-founder who eventually all but wrecked it. Neumann had two great ambitions when he was young: to grow wealthy and to save the world. An Israeli emigrant who’d lived for a time on a kibbutz, Neumann believed his two goals could be folded into one and pursued by the same methods: brash self-promotion to the point of self-mythologising, florid salesmanship and a swashbuckling, impulsive management style reflective of what he considered to be his own genius.
All he needed was a product. His first idea was women’s shoes with retractable high heels. It failed. His next notion was baby pants with built-in kneepads. “Krawlers” gained a small footing in its modest niche and he sold it and kept thinking. The big idea that resulted — leasing office spaces long-term, and chopping them up into smaller spaces for short-term rental at higher rates — was not original to him. Such co-working enterprises were quite common by 2010, when Neumann and his partner, Miguel McKelvey, created WeWork and headquartered it in New York City. But Neumann did bring something novel and exciting: his own still-evolving messiah complex. And lots of open workplace boozing, and a special ventilation system that allowed him to smoke marijuana at his desk.
The reigning conceit of the author’s tragicomic play-by-play of Neumann’s misadventures is that of a cult masquerading as a real business. Central to this theme is the sustained involvement of Neumann and his wife, Rebekah Paltrow (Gwyneth’s cousin), in the Kabbalah Centre. What exactly is taught there is elusive to non-members — some sort of Jewish mysticism, allegedly, dating back to the 12th century but repackaged for affluent New Age consumers with yoga bodies and Instagram — but it has attracted stars and luminaries since the eighties, including Madonna, its premier disciple.
For readers, Neumann is a flake from Wiedeman’s opening paragraph. Citing an interview from April 2019, Wiedeman describes Neumann as engaged in a belated campaign to polish his image and raise one of many rounds of outside cash to replace the vast sums he’d already dissipated. “He no longer had the punching bag, the gong or the bar that occupied his previous suite,” Wiedeman writes, “but this version had a private bathroom with a sauna and a cold-plunge tub.” The surrounding offices were comparably exotic: “Beneath a kitchen canopy draped with hanging plants, several water coolers were stuffed with a rotating orchard of fruit… A placard helpfully explained to the company’s fresh-faced workforce, where 30-year-olds felt like senior citizens, that tilting your glass while dispensing a beer would lead to a smoother pour.”
The smoothest pour of all at WeWork was the frothy utopian verbiage continually streaming from Neumann’s mouth. Its chief concern, however, was the wonderful futuristic world of We. What the letters “Mc” are to McDonald’s, “We” was to Neumann. WeLive, for example, was the name he gave to an ostensibly world-altering initiative to extend his kingdom from commercial real estate to residential.
All of which presents a mystery: How on earth did Neumann and his WeThing attract an almost unprecedented level of private investment capital during his decade-long tenure as its head shaman? The answer is never stated explicitly, but lives in the margins and between the lines on almost every page: because the private equity community had Neumann-like magical thinkers of its own. Wiedeman’s finest feat of reporting and double portraiture is his evocation of Neumann’s relationship with his financial saviour (for a time) Masayoshi Son, the big-picture, long-term, positively cosmic founder of the Japanese tech conglomerate Softbank.
To delve further into their relationship would be to give away the plot, one that only reality could contrive. To fully appreciate its twists and turns, the reader should understand, or be willing to study on the fly, the customs, manners and vocabulary of contemporary investment banking. The global pool of capital on which free-market societies float like inflatable rubber ducks is a virtually bottomless reservoir of folly, vanity, mania and caprice. What was Neumann’s company worth in its heyday? Ten billion dollars? Forty-five? Or was WeWork’s value potentially — as Son and Neumann both foresaw at one point, before a disastrous, aborted IPO curbed the madness — a nice round trillion? All of the above, and none. What can be reliably calculated, however, is the ransom paid to Neumann for turning over his ghost ship to new officers. A billion dollars.
So what is the moral of this cautionary tale? Different readers will settle on different charges, but it might not matter. A 10-figure payout proves all of them wrong.
©2020 The New York Times News Service