The workspace company’s troubles are a sign that the ‘unicorn’ economic model cannot be sustained
It happens every few years – not quite with the regularity of the seasons but with the inevitability of a natural disaster. A new company is founded on the basis of a new and seemingly ingenious concept, and then rocket-fuelled by growth-boosting investor capital. It briefly burns bright and then implodes, collapsing under the weight of its own balance sheet.
The latest tech financial calamity is WeWork, an office space and “workplace solutions” operator that is now shrinking rapidly, after a planned initial public offering (IPO) was scrapped when potential investors rejected its absurd $20bn (£15.5bn) valuation. WeWork’s collapse is a business-school study in the excesses of private capital in an unregulated market that fetishises the wealth-creating genius of the lone pioneer.
The WeWork debacle should be an indictment of the character of contemporary finance capitalism
Source: Guardian GiG Economy