The Cult of We

In the gleaming towers of Manhattan and the venture capital corridors of Silicon Valley, a remarkable deception unfolded between 2010 and 2019 that would expose the dangerous underbelly of modern startup culture. What began as a simple office-sharing concept evolved into one of the most spectacular corporate collapses in business history, revealing how charismatic leadership, unlimited capital, and collective delusion could transform a basic real estate business into a supposed $47 billion technology revolution.

This extraordinary rise and fall illuminates three critical questions about our modern economy. First, how did the world's most sophisticated investors repeatedly fall for what was essentially elaborate financial theater, mistaking rapid expansion for genuine innovation? Second, what happens when founder worship meets unlimited venture capital in an era where compelling narratives matter more than sustainable profits? Finally, what does this spectacular bubble teach us about the dangerous intersection of charismatic leadership, governance failures, and the seductive power of seemingly infinite money that continues to shape our business landscape today?

The story begins in 2001 with a twenty-two-year-old Adam Neumann stepping off a plane at JFK Airport, carrying little more than boundless ambition and grandiose dreams of American success. Fresh from mandatory service in the Israeli Navy, Neumann was determined to carve out his own path to fortune, inspired by his sister's modeling career in New York. His first venture, Krawlers, sold baby clothing with padded knees for crawling infants. Though the concept was simple, execution proved challenging, and the business struggled financially while mounting debts accumulated.

Even in these early failures, the seeds of Neumann's future approach were clearly visible: an unshakeable belief in his own vision, an extraordinary ability to charm potential investors, and a dangerous tendency to oversell modest concepts as revolutionary breakthroughs. The turning point came when Neumann met Miguel McKelvey, an Oregon-raised architect whose gentle demeanor perfectly complemented Neumann's aggressive salesmanship. Together, they launched Green Desk in 2008, a small Brooklyn co-working space emphasizing environmental sustainability that tapped into both the growing freelance economy and rising environmental consciousness.

Green Desk's modest success taught Neumann a crucial lesson about the power of community and branding in real estate. Tenants weren't just renting desks; they were buying into an identity and lifestyle. This insight revealed the foundation of the real estate arbitrage model that would later define WeWork: lease space wholesale, divide it up, and rent it retail at a premium while selling the intangible value of belonging to something bigger than yourself.

The 2008 financial crisis had created perfect conditions for this new approach, leaving traditional office spaces expensive and inflexible while generating a massive pool of unemployed professionals starting their own businesses or working as consultants. When Neumann and McKelvey sold their stake in Green Desk to their business partner, they were already plotting something much bigger, something that would transform not just how people worked, but how they lived and connected with one another in an increasingly digital world.

In 2010, Neumann and McKelvey opened their first WeWork location at 154 Grand Street in Manhattan's SoHo district, transforming what started as simple shared office space into something that defied easy categorization. Neumann possessed an intuitive understanding that in the age of social media and digital connection, people desperately craved authentic community and physical gathering spaces. WeWork wasn't just offering desks; it was promising to be the "physical social network" for a generation of entrepreneurs and freelancers seeking belonging in an atomized economy.

The timing proved absolutely perfect. The financial crisis had created ideal conditions: traditional office leases were too expensive and inflexible for the new gig economy, while WeWork offered month-to-month memberships, free beer, and most importantly, a sense of belonging to something transformative. Neumann positioned the company not as a real estate business, but as a technology platform that happened to operate in physical space, a narrative that proved irresistible to venture capitalists desperately seeking the next big thing in a post-Facebook world.

Neumann had masterfully learned the art of the pitch, painting visions of global expansion and technological disruption that made even seasoned investors suspend their disbelief. He spoke of WeWork members as a community that would eventually number in the millions, connected by shared values and enabled by cutting-edge technology. Revenue multiples that would have been laughable for a traditional real estate company suddenly seemed reasonable for a "platform" business with supposed network effects and unlimited scalability.

The company's growth was indeed spectacular, expanding from that first SoHo location to dozens of cities and hundreds of locations while revenue doubled year after year. Each funding round brought higher valuations and more prestigious investors, creating a self-reinforcing cycle where success bred more success. By 2016, WeWork had successfully convinced some of the smartest investors on the planet that Neumann's real estate arbitrage business was actually a technology company worthy of tech-like valuations. The illusion was becoming complete, but the foundation was already beginning to crack under the weight of its own contradictions and the dangerous precedent that growth could indefinitely substitute for profitability.

The arrival of Masayoshi Son and SoftBank's Vision Fund in 2017 marked the beginning of WeWork's most intoxicating and ultimately destructive phase. Son, the Japanese billionaire who had made his fortune betting early on internet companies like Alibaba, was on a mission to deploy $100 billion in capital to accelerate the future of technology. When he met Neumann, he found a kindred spirit who shared his belief that conventional business wisdom was for small thinkers, and that true visionaries could bend reality through sheer force of will and unlimited resources.

Son didn't just invest in WeWork; he became Neumann's enabler-in-chief, encouraging ever more grandiose visions and reckless spending that would have been impossible under normal circumstances. In one legendary meeting, Son scribbled "$10 trillion" on a piece of paper, suggesting that WeWork could eventually be worth more than the entire U.S. stock market. This wasn't hyperbole to Son; it was a roadmap for world domination. The Vision Fund's massive investment came with an implicit message that money was no object, growth was everything, and profitability could wait indefinitely.

This unprecedented flood of capital had a profoundly corrupting effect on WeWork's culture and decision-making processes. The company began expanding into increasingly bizarre ventures that had little connection to its core business model. There was WeGrow, an elementary school based on Rebekah Neumann's educational philosophy. WeLive promised to revolutionize urban housing through community-focused living spaces. The company even invested in a wave pool technology company, apparently because Neumann enjoyed surfing and saw synergies with the WeWork lifestyle brand.

The abundance of capital also enabled Neumann's personal excesses to reach unprecedented heights while removing all meaningful constraints on his behavior. He purchased multiple luxury homes, a private jet, and began treating WeWork as his personal piggy bank, with the company paying for his family's lifestyle, his friends' businesses, and his increasingly grandiose vision of himself as a world-changing leader. Son's money had eliminated the natural feedback mechanisms that might have imposed discipline, creating dangerous conditions where fantasy and reality became increasingly difficult to distinguish, setting the stage for a spectacular reckoning.

By early 2019, WeWork's private funding options were essentially exhausted, and the company desperately needed billions more to continue its cash-burning expansion across global markets. An initial public offering seemed like the natural next step for a company valued at $47 billion, but going public meant subjecting WeWork's business model and governance to unprecedented scrutiny from skeptical public market investors rather than friendly venture capitalists already committed to the growth-at-all-costs narrative.

The IPO prospectus filed in August 2019 was a masterpiece of corporate doublespeak and new-age mysticism, featuring inspirational quotes, artistic photography, and a dedication "to the energy of We—greater than any one of us but inside each of us." More damaging were the financial disclosures that revealed the true extent of WeWork's staggering losses and Neumann's systematic self-dealing. The company was losing money at an unprecedented rate, burning through cash every minute while Neumann personally profited from real estate deals and trademark sales to his own company.

The market's reaction was swift and absolutely brutal. Financial analysts, journalists, and potential investors tore apart WeWork's business model and corporate governance with a ferocity that caught Neumann completely off guard. The company that had been valued at $47 billion just months earlier was now being mocked as the ultimate cautionary tale of Silicon Valley excess and founder worship gone wrong. Potential investors stayed away in droves, and the IPO that was supposed to provide WeWork with billions in fresh capital instead became a public relations disaster that exposed the hollowness at the company's core.

As the IPO collapsed spectacularly, so did confidence in Neumann's leadership among his previously loyal supporters. Board members who had rubber-stamped his decisions for years suddenly found their voices and began demanding accountability. Investment bankers who had courted him relentlessly began distancing themselves from the toxic situation. Even SoftBank's Masayoshi Son, his most important backer and philosophical ally, turned against him as the financial reality became undeniable. In September 2019, facing complete loss of support and the very real prospect of WeWork's bankruptcy, Neumann was forced to resign as CEO, walking away with over $1 billion while thousands of employees lost their jobs and saw their stock options become worthless overnight.

The collapse of WeWork sent shockwaves throughout Silicon Valley and the broader investment community, exposing fundamental flaws in how the modern venture capital ecosystem evaluates companies and leaders. For nearly a decade, investors had prioritized charismatic founders and compelling narratives over basic business fundamentals, creating a dangerous cult of founder worship where visionary CEOs were given unprecedented control and resources with minimal oversight. WeWork represented the inevitable result of this approach taken to its logical extreme: a simple real estate company that convinced the world it was a revolutionary technology platform worthy of a $47 billion valuation.

The WeWork debacle revealed how entire financial systems can be corrupted when optimism replaces critical thinking and when everyone involved stands to profit from maintaining a collective delusion. SoftBank was forced to bail out the company at an $8 billion valuation, representing a stunning 83% decline from its peak, while thousands of employees lost their jobs and many more saw their stock options become worthless. The same dynamics that enabled Neumann's deception continue to shape markets today, from cryptocurrency bubbles to the latest wave of "disruptive" startups that promise to revolutionize traditional industries through the power of technology and vision alone.

The broader implications extend far beyond one failed startup, serving as a reminder that in business, as in life, there are no shortcuts to creating genuine value. Charisma and capital can take entrepreneurs far, but they cannot indefinitely substitute for sound business fundamentals, honest leadership, and sustainable business models that create real value for customers and society. The story illustrates the dangerous seduction of charismatic leadership and the willingness of sophisticated investors to suspend disbelief when everyone stands to get rich from maintaining shared illusions.

The most important lesson may be that the next time a charismatic entrepreneur promises to change the world while burning through billions of dollars, we must ask harder questions and demand better answers before the inevitable reckoning arrives. This means insisting on transparency in corporate governance, demanding sustainable business models over growth-at-all-costs strategies, and remembering that genuine innovation creates lasting value rather than just paper wealth for founders and early investors.

The WeWork saga represents the collision of several powerful forces that defined the 2010s: unlimited venture capital seeking exponential returns, a founder-worship culture that prioritized vision over execution, and a broader economic environment where traditional business metrics seemed obsolete in the face of technological disruption. At its core, this was a story about the dangerous seduction of charismatic leadership and the willingness of sophisticated investors to suspend disbelief when everyone stands to profit from maintaining collective delusions about revolutionary change and unlimited growth potential.

The lessons from WeWork extend far beyond Silicon Valley boardrooms into our current era of rapid technological change and abundant capital. We must remain vigilant against the next charismatic leader who promises to revolutionize the world while primarily enriching themselves in the process. This means demanding transparency in corporate governance, insisting on sustainable business models that create genuine value for customers and society, and remembering that the true test of any business or leader should not be their ability to raise money or generate headlines, but their capacity to build something of lasting value that makes the world genuinely better rather than just creating paper wealth for insiders.