WeWork never figured out how to make money. Adam Neumann sure did.
The office-leasing business declared bankruptcy on November 6, two years after finally going public minus its co-founder.
It has $19 billion of liabilities and $15 billion of assets. Longtime investors, including SoftBank Group and the Vision Fund, will add to the enormous losses they’ve already taken on the venture.
“It has been challenging for me to watch from the sidelines as WeWork has failed to take advantage of a product that is more relevant today than ever before,” Mr Neumann, 44, said in a statement at the time.
But a part of Mr Neumann might be thankful he was forced out in 2019 following the company’s disastrous first attempt at an initial public offering.
While battering his reputation, the exit left him with plenty of liquidity and he’s still worth $1.7 billion, according to the Bloomberg Billionaires Index.
WeWork offices – in pictures
To be sure, WeWork’s failure hurt Mr Neumann’s wealth. When it went public in a merger with a special purpose acquisition company in 2021, Mr Neumann had a fortune of $2.3 billion, according to the index, with nearly one third in WeWork shares. They’ve since fallen more than 99 per cent.
But the deal also revealed how he managed to extract huge amounts of cash from WeWork in better times.
The former chief executive’s name was mentioned 197 times in a merger filing alongside eye-watering payouts, including a $185 million non-compete agreement, $106 million settlement payment and $578 million received for shares sold by Mr Neumann’s We Holdings to SoftBank.
These days, Mr Neumann is busy with a new start-up, Flow, which received a $350 million investment from venture capital firm Andreessen Horowitz at a $1 billion valuation in August 2022 before even beginning operations.
Flow will run multifamily residential properties that aim to foster a feeling of ownership and community.
At least some of the residential properties were already owned by Mr Neumann. Because his own investment in the company couldn’t be determined, Flow hasn’t been factored into Mr Neumann’s fortune, meaning he could be even wealthier than Bloomberg’s figure.
Not all of his investments outside of WeWork have been going so well. His family office fell behind on interest payments on a $31 million mortgage tied to a San Jose office building in California, according to an October mortgage filing.
Mr Neumann famously invested in office buildings, some of which were rented back to WeWork, one of the conflicts of interest that sunk the first IPO.
Billionaire and former hedge fund manager Leon Cooperman has taken a late stake in Manchester United, the football club that’s nearing the end of a year-long bidding war.
Mr Cooperman reported a position of just under 1 million shares currently valued at $16.8 million, according to a recent filing.
With a net worth of $2.6 billion, according to the Bloomberg Billionaires Index, Mr Cooperman is the founder of New York-based Omega Advisors who converted his hedge fund firm into a family office in 2018.
Last month, a Qatari group led by Sheikh Jassim bin Hamad Al Thani withdrew its offer to buy Manchester United, paving the way for British billionaire Sir Jim Ratcliffe to eventually gain control of the famous football club.
Funds have been betting on the outcome of the Manchester United sale process, which was officially kicked off by the Glazer family a year ago.
At times, the bidding war was closer to a frenzied Premier League deadline day or NFL draft than a billion-dollar deal and has caused the club’s share price – listed in New York – to be highly volatile.
So far this year, the stock has fallen 19.02 per cent.
Warren Buffett’s Berkshire Hathaway reduced the number of stocks in its portfolio in the third quarter, exiting stakes in General Motors and Activision Blizzard while trimming bets on companies including Hewlett Packard.
The conglomerate’s retreat from Activision completes Mr Buffett’s arbitrage play amid the video-game maker’s prolonged effort to merge with Microsoft, which ran into antitrust scrutiny before the deal was completed in October.
Altogether, Berkshire exited stakes in seven companies, not including the restructuring of its investment in Liberty Media and related entities. The value of its disclosed investments decreased 10 per cent from the previous quarter to $312.8 billion.
The conglomerate said it had omitted some data from the filing that was reported confidentially to regulators, and it’s unclear whether the information withheld related to a new or existing position.
The Securities and Exchange Commission sometimes allows companies to withhold information from the public to limit copycat investing while a firm is building or cutting a position.
Berkshire has been a net seller of equities throughout 2023, pocketing about $23.6 billion from stock sales after purchases in the first nine months of this year.
Those equity sales have contributed to a high-class problem for the conglomerate: More money than it can easily put to work.
Much of the hoard has ended up in short-dated Treasuries, helping Berkshire rack up a record $157 billion in cash.
Billionaire Stanley Druckenmiller’s family office led investment firms for the world’s rich in trimming artificial intelligence bets in the last quarter, pocketing gains from one of this year’s hottest trends.
Mr Druckenmiller’s Duquesne Family Office cut its Nvidia stake in the quarter ended September 30, according to its 13F filing, the first time this year the New York-based firm disclosed a drop in its holdings of the major beneficiary of increased AI interest.
George Soros’s family office and a division of multifamily office Stonehage Fleming also offloaded the stock in the period. Nvidia’s shares have surged almost 240 per cent this year, making it the S&P 500 index’s top performer.
Nvidia has become the poster child for AI computing as data-centre operators stock up on the company’s processors to meet skyrocketing demand for chatbots and other tools, helping to make the California-based company the first chipmaker to be worth $1 trillion.
Mr Druckenmiller, 70, sold about 75,000 Nvidia shares in the third quarter worth as much as $37.2 million, based on its share price in the period.
Nvidia remains the biggest holding by market value in Mr Druckenmiller’s family office at $380.5 million as of September 30, with South Korea e-commerce giant Coupang and Microsoft among its other major bets.
Soros Fund Management, meanwhile, exited Nvidia in the third quarter, selling stock worth as much as $4.9 million.
Mr Druckenmiller and Mr Soros, 93, have net worths of $9.9 billion and $7.2 billion, respectively, according to the Bloomberg Billionaires Index.