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The disgraceful CEO of WeWork receives a huge payout. Now workers are expecting their own destiny



The Neumann Gold Parachute was included in a rescue deal for SoftBank, officially announced late Tuesday, which will push billions more into the fight against the company after its unsuccessful IPO. According to Neumann, he will be able to sell up to $ 970 million worth of stock back to SoftBank, receive a $ 500 million loan to repay a line of credit and a $ 185 million consultation fee for SoftBank, according to a person familiar with the matter.

The rescue leaves Softbank to control the company and clean up the mess left behind by Neumann. In company-wide emails sent to CNN Business on Wednesday, WeWork executives tried to line up with employees about other business issues. He later had an all-hands meeting, led by Marcelo Clare, chief operating officer of SoftBank, who became CEO of WeWork as part of the deal.

At the meeting, Claire addressed a question about Neumann's payment, acknowledging the work he had done for the company, according to two sources familiar with the meeting. Claure explained that while the steps SoftBank is taking are costly, they were necessary to take control of the business and that Neumann will serve as a SoftBank consultant and have a non-compete clause, said a third party familiar with the meeting.

Under the leadership of Neumann, WeWork raised billions of dollars, scaled its co-operation operations in hundreds of cities around the world and was valued at attracting $ 47 billion during a single investment round. But also under Neumann, the company failed spectacularly in its attempt to publish heavily as IPO documents revealed its untested power and numerous potential conflicts of interest, as well as the striking losses of WeWork.

Neumann is "probably one of the best grippers in history," said a former WeWork CEO who spoke to CNN Business on condition of anonymity. "The fact that the company is in this situation is due to direct decisions and actions he takes. He controls the company. "

WeWork declined to comment on the story.

Neumann stepped down as CEO last month amid reports that some investors, including his biggest investor, SoftBank, wanted to eliminate him. which was losing money needed a new investment of capital. Things were so bad that the company was reportedly unable to fire employees as expected because it could not afford to pay compensation.

SoftBank will take 80% ownership of the company cat o part of the deal to pump $ 5 billion, as well as accelerate the $ 1

.5 billion investment initially due next year. The package estimates WeWork at $ 8 billion, only a fraction of its highest estimate

Neumann was not just any CEO: He emphasized the importance of "community" – a word that appeared 150 times in the company's IPO documentation – even renaming The We Company earlier this year. Speaking at the scene of the 2018 US Mayors Conference, Neumann said: "As mayors, as leaders, as CEOs, it is our responsibility to set the trend for the future, and the trend of the future is" we "versus" I. "

  WeWork postpones IPO

Others voice the mood. "How on earth can a company run the land and then pay it back? The employees who worked their backs to try to make this thing work – and he has to turn around and take that money off the table – "I find it disgusting," said another former CEO. "In some way, form or form, karma is coming back around."

Former executives and senior executives told CNN Business that while their stock options are underwater, they are more concerned about employees still in the company who are in younger positions and can rely of their equity. [19659007] On Tuesday, prior to the formal announcement of the deal, details of its details caused a stir in the ranks of WeWork. Employees sent dozens of messages discussing reports on internal Slack chat channels, as one employee speaking on condition of anonymity told CNN Business.

Some messages viewed by CNN Business highlight concerns that the Neumann deal and payment could affect employees. One message suggested that in light of how much the company talks about the importance of the community, Neumann should consider splitting its payroll with staff. Another includes the hashtag "#WEgotplayed."

By Wednesday, the company tried to smooth things out with employees who spent most of Tuesday extracting information from the press.

"While we understand that you have questions about this message, we ask that you ask us, as we will not have all the answers today," co-CEOs Artie Minson and Sebastian Gunningham wrote in an email to employees. [19659003] Meanwhile, in another email, Claure informs staff that there will be an indefinite number of layoffs.

In an email, Claure writes that "the last two months have been challenging and I will not minimize these challenges. We have already begun making some of the appropriate changes to address them. But in these difficult times, companies are redefining themselves. "

" To be frank, what we lack is a focus on our core business: WeWork, along with accountability and hassle-free execution, "he added." The beauty is that it's all under our control. We have a lot of work to do. This job will not be easy. The road will not always be smooth. But we will prevail. No excuses. "[19659003] In an email, Claure confirmed that there would be layoffs." I don't know how many, "he writes. capital to determine the amount, according to an employee.


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