AP Photo/Mark Lennihan
Adam Neumann, former CEO of The We Company.
- WeWork founders Adam and Rebekah Neumann's family office has loaned money to PCS Wireless, the phone distributor company, Business Insider has learned.
- Family office activities are often kept under wraps. The short-term PCS loan marks the second instance of lending Business Insider has found this week.
- The other loan went to a British startup boss who was later fired from his company over allegations of gross misconduct.
- For more stories about WeWork, click here.
Family offices are notoriously secretive. The investment arms for the mega-rich often do deals with like-minded groups, staying out of headlines.
This week, Business Insider found two examples of the kind of investments WeWork founders Adam and Rebekah Neumann have made through their family office.
Two loans - a personal loan to a UK startup founder, and another short-term business loan to a major mobile phone distributor - show how varied the family office's activities have been. They also offer clues about how the Neumanns planned to make money outside of WeWork, under the direction of former General Catalyst investor Ilan Stern. He leads their family office, called 166 2nd Financial Services, named after the New York building where Adam and Rebekah Neumann once lived.
On Tuesday, BI reported that the family office lent $110,000 to a British startup boss who was later fired from the UK energy technology startup Faraday Grid over allegations of gross misconduct. That loan came after the family office invested $30 million in Faraday Grid in January, while Neumann still the chief executive of WeWork.
Now, BI has learned that 166 2nd made a much different kind of loan in the spring, one that sheds light on how the family office is deploying money outside of startups and personal connections. Neumann has personally invested in a number of startups with his WeWork wealth since 2013, also backing Pins, Feature.fm, Tunity, Selina, EquityBee, InterCure, and Hometalk, according to Crunchbase.
The spring loan is also a window into how the Neumanns are investing outside of WeWork, which shelved plans to go public after a tumultuous lead-up to an IPO that saw Adam Neumann step down as CEO. He is staying on as non-executive chairman.
Loan for a cash flow crunch
PCS Wireless, the Florham Park, New Jersey-based mobile phone distributor, needed a short-term loan to help with a cash flow crunch in the spring, said a person involved in the deal. A document filed with the state of Florida shows that 166 2nd secured the loan in late March.
The loan, which covered only a few months, has since been repaid, the source said. It's unclear how much 166 2nd lent to PCS.
A spokeswoman for the family declined to comment on the loan.
PCS, a privately-held company, borrowed from 166 2nd in a deal arranged by Stern, the source said. The borrower had little interaction with the Neumanns. Often, parties doing business with family offices don't work with the families directly, since they have intermediaries like Stern to oversee their portfolios.
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