Wikipedia/Mattkholland
WeWork chairman and SoftBank COO, Marcelo Claure
- A day after WeWork announced it had accepted a bailout package from SoftBank, the coworking company's new chairman addressed the troops.
- In a leaked email seen by Business Insider, the new chairman, SoftBank COO Marcelo Claure, tried to simultaneously pep-talk the troops while confirming layoffs were coming.
- Claure did not acknowledge the $1.7 billion golden parachute offered to ousted CEO Adam Neumann but he did indicate that previous management was lacking both focus and "accountability."
- Business Insider is sharing the full email. For more WeWork stories, click here.
On Tuesday evening, WeWork reached a deal with its top investor SoftBank to prevent the coworking company from running out of cash and possible bankruptcy.
As part of the deal, Marcelo Claure, SoftBank's chief operating officer, will take WeWork cofounder Adam Neumann's position as chairman, and the board will add more members. SoftBank will also reportedly provide Neumann with almost $1.7 billion and he will become a non-voting member of the board.
Business Insider obtained a copy of the email Claure sent Wednesday morning to WeWork employees ahead of an all-hands meeting.
The message thanked employees for hanging with the company during its downward spiral and painted a rosy picture of WeWork's future.
But it also confirmed for a third time that WeWork's employees can expect layoffs and again, for a third time, it offered them no details as to who or how many or when this would commence.
"Yes, there will be layoffs - I don't know how many - and yes, we have to right-size the business to achieve positive free cash flow and profitability," the email said. "But I will promise you that those that leave us will be treated with respect, dignity and fairness."
Read: WeWork CEOs tell staff layoffs are coming in leaked email ahead of decision on rescue package
He also seemed to hint that employees could still expect to get stock in some form: "And for those that stay, we will ensure everyone is aligned and shares in future value creation."
He did not discuss the exodus of leadership or the golden parachute SoftBank issued to Neumann, a circumstance that has infuriated many employees who blame the executive for WeWork's implosion, they told Business Insider.
But he did acknowledge the company has work to do, writing, "To be candid, what we are lacking is focus on our core business: WeWork, along with accountability, and seamless execution."
Here's the full email:
To All WeWork Team Members,
Today is a defining day in the history of this great company. As you have probably read by now, SoftBank has made one of its largest financial commitments ever to a company, doubling down on WeWork with a $9.5B commitment to fully fund the company's business plan. We can now focus on what we do best - redefining the nature of work.
We are making this commitment because of our firm belief in WeWork's mission, what we have accomplished, and what we are going to achieve as we move forward together. I know firsthand the power of the WeWork brand and the quality of our product. First with Sprint, where WeWork reimagined out corporate headquarters in a way that totally changed the culture of a 120-year old company and transformed our working environment to be more open and collaborative. And now WeWork will be doing the same at our headquarters at SoftBank Tokyo. Furthermore, I am committed to do the same across all SoftBank properties around the world, including some of our leading portfolios companies.
Over the past nine years, WeWork has been on a journey to disrupt the multi-trillion-dollar commercial real estate market, positioning itself at the forefront with a mix of real estate assets and global scale that are far beyond any competitors. It is because of this that SoftBank is excited to fortify the Company with additional capital and seasoned operational support. As Executive Chairman of WeWork, I will be providing oversight and support to the WeWork leadership team as we embark together on this next chapter.
All the world's leading innovators and disruptors have had their ups and downs. I'd be hard-pressed to find a market leader like WeWork that didn't experience a difficult period in its early days. The past two months have been challenging, and I'm not going to minimize those challenges. We have already started making som of the appropriate changes to address them. But it is in these tough times that companies get redefined.
Fortunately, we have all the necessary ingredients to make this one of the most amazing comeback stories ever, and prove our detractors wrong. We have an incredible brand and a product that our members absolutely love. We have the world's leading customers, including over 38% of the Global Fortune 500 companies. Landlords around the world are eager to partner and continue to grow with us. We have the highest quality investors. And more importantly, from the interactions I've had wit you so far, we have one of the most dedicated workforces on the planet which everyday demonstrates unparalleled resilience and persistence.
To be candid, what we are lacking is a focus on our core business: WeWork, along with accountability, and seamless execution. The beauty is that this is all within out control. We have a lot of work ahead of us. The work won't be easy. The path won't always be smooth. But we will prevail. No excuses.
I want to thank all of you for staying strong throughout this crisis. Thanks to Artie, Sebastian and Miguel for stepping up during these difficult times. And special thanks to our Community teams around the world who carry out our mission: to create a world where people work to make a life, not just a living.
I am totally committed to open and transparent communication with you. I will share with ou the good and the bad as we embark on this journey together. Yes, there will be layoffs - I dont know how many - and yes, we have to right-size the business to achieve positive free cash flow and profitability. But I will promise yo that those that leave us will be treated with respect, dignity and fairness. And those that stay, we will ensure everyone is aligned and shares in future value creation.
I look forward to working with WeWork's management team and getting to know many of oyu in the days and weeks ahead. I am hosing an all-company meeting in just a few hours to engage with you and answer any questions you may have. Or if you have ideas or thoughts you want to share with me, within the next 12 hours I will have a new WeWork email address.