Troubling news for the co-working company
SoftBank is now negotiating an investment of $2 billion, a much lower amount than the $16 billion previously discussed. Interestingly, the investment will not include the participation of Softbank’s Vision Fund.
Down round: The most recent funding round valued WeWork at $42 billion. This new funding round would value the company at around $20 billion.
The backdrop: The main backers of the Vision Fund, Saudi Arabia’s PIF and Abu Dhabi’s Mubadala, have cast doubt on the viability of WeWork’s business model. They told Masayoshi Son’s to stick technology bets, not real estate estate ones.
Worth Noting: If a deal is finalized, Masa’s SoftBank will have invested more than $10 billion in the co-working company. With that being said, a source close to the negotiations told the Financial Times, “there is more hesitancy and a need to be more cautious on how SoftBank is proceeding.”