Embattled WeWork CEO Adam Neumann steps down from co-working major
Adam Neumann's announcement comes at a time when the startup is facing questions over its governance and profit outlook that have clouded its prospects for going public.
Wednesday September 25, 2019,
2 min Read
WeWork Co-founder Adam Neumann said on Tuesday that he is stepping down as CEO of the office sharing startup, calling the increased scrutiny he faced in recent weeks "a significant distraction."
Neumann's announcement, which confirmed earlier AFP reporting, comes as the startup faces questions over its governance and profit outlook that have clouded its prospects for going public.
Prior to his announcement, Neumann had faced pressure from board members tied to Softbank, a major investor, according to people with knowledge of the matter.
Neumann also met Sunday with Jamie Dimon, CEO of JPMorgan Chase, the lead underwriter for the company's initial public offering, and the encounter weighed on Neumann's decision to step down, the sources said.
He has come under scrutiny for perceived self-dealing as head of the fast-growing enterprise.
In its prospectus to go public, WeWork disclosed that it had leased from entities in which Neumann "has or has had a significant ownership interest." Neumann will remain as Chairman of the company he started in 2010 and also continues to control a majority of voting shares.
"As Co-founder of WeWork, I am so proud of this team and the incredible company," Neumann said. "While our business has never been stronger, in recent weeks, the scrutiny directed toward me has become a significant distraction, and I have decided that it is in the best interest of the company to step down as chief executive."
The company has named Chief Financial Officer Artie Minson and former Vice Chairman Sebastian Gunningham as co-CEOs.
"We would like to thank Adam for his vision and his passion in building WeWork over the past 9 years," Minson and Gunningham said in a news release. "Our core business is strong and we will be taking clear actions to balance WeWork's high growth, profitability and unique member experience while also evaluating the optimal timing for an IPO."
(Edited by Suman Singh)