WeWork, which provides shared workspaces for freelancers, start-ups and Fortune 500 companies is expected to be valued at around $20 billion in its forthcoming initial public offering (IPO), according to the Financial Times. This figure is less than half of the provisional $47 billion figure the company put forward only two weeks ago.
WeWork’s parent, We Company, is considering selling its shares at a more than 50 percent discount and has also discussed having one of its biggest backers, the Japanese technology giant SoftBank, provide more cash and delaying the offering.
The cut comes after prospective investors raised concerns as to the profitability of the currently loss-making company, according to those close to the IPO.
Despite the aforementioned $20 billion figure, a person close to the company said it still hoped the valuation could finish somewhere between $25 billion to $30 billion.
JPMorgan Chase and Goldman Sachs, some of the banks working on the IPO are concerned about overvaluing the office rental company when it lists, as was the case for Uber, which has traded down heavily since its flotation earlier this year.
Founded in 2010, WeWork is headquartered in New York City and manages 46.63 mill. sq. ft. as of 2018. In January 2019 it announced it would be rebranding to The We Company.
Photo: Michael Vi