We(don't)Work: Rent-a-desk outfit cuts 2,400 staff in bid to be a functioning business
About 20% of employees worldwide look for new jobs
Millennial daycare provider WeWork says it will lay off about one fifth of its workforce – 2,400 employees – as it tries to get its finances in order.
The techie-themed office rental company says that the layoffs will come from around the globe, and are part of an ongoing effort to thin its ranks to get closer to profitability, as it tries to reorganize without CEO and founder Adam Neumann. Who, by the way, left with $1.7bn in severance.
To its credit, WeWork says all of the former employees will at least get a decent exit package, a definite step up from what happened during the last round of job cuts in September.
"As part of our renewed focus on the core WeWork business, and as we have previously shared with employees, the company is making necessary layoffs to create a more efficient organization. The process began weeks ago in regions around the world and continued this week in the US," WeWork said in a statement to The Register.
"This workforce reduction affects approximately 2,400 employees globally, who will receive severance, continued benefits, and other forms of assistance to aid in their career transition. These are incredibly talented professionals and we are grateful for the important roles they have played in building WeWork over the last decade."
WeWork, but We don't IPO: Self-styled techie boarding house calls off cursed stock offeringREAD MORE
The layoffs had been widely expected in the wake of Neumann's resignation and the increased presence of SoftBank, whose investment arm recently committed $5bn to a business that burned through billions in cash and has yet to even prove itself capable of making a profit.
Once valued as high as $47bn by giddy Wall Street analysts, WeWork has tanked over recent months as the details of its inner workings emerged and doubts arose that the company would ever be able to return a profit on its dirt-cheap subleasing business model.
Now, with Neumann out and thousands of employees holding pink slips, newly-minted co-CEOs Artie Minson and Sebastian Gunningham will begin their re-org in earnest. ®
Full disclosure: El Reg operates out of WeWork buildings in London and San Francisco. We have suffered through our own hardships of late, including the locally roasted coffee and microbrews being replaced with Folgers and Modelo. Tough times indeed.