The Cult of We: WeWork, Adam Neumann, and the Great Startup Delusion

By Eliot Brown & Maureen Farrell

10 min read

Why does it matter? Because the investors who funded WeWork weren't fooled — they were incentivized.

The easy story is that Adam Neumann fooled everyone. That Benchmark missed the warning signs, that Fidelity's analysts got charmed, that SoftBank's Masayoshi Son made a $10 billion mistake in a twelve-minute building tour. That reading feels satisfying — a flaw found, a lesson learned, move on.

This book refuses that comfort. What the authors found, across years of reporting, is that the institutions knew. Benchmark's partners debated whether real estate could scale like software. Fidelity's private markets team filed a memo saying the math didn't work. JPMorgan's bankers delivered warnings that Neumann laughed off — and then signed on to lead the IPO anyway. The question this summary answers isn't how everyone was fooled. It's why, for each institution in turn, being fooled was the most profitable available choice.

The Charisma Wasn't a Con — the Early Business Actually Worked, and That's What Made the Delusion Contagious

Bruce Dunlevie flew to New York already doubtful. One of Benchmark's founding partners (the firm that turned a $6.7 million bet on eBay into $5 billion), he had heard enough pitches to develop a finely calibrated skepticism detector. A colleague had been lobbying him for months about this co-working company, and Dunlevie finally cleared a day on his calendar. Within the first few hours with Adam Neumann, he had his verdict: bullshitter.

Then Neumann started knocking on doors.

Not conference room doors. Actual office doors, mid-workday, with members inside on phone calls. He'd push one open, ask for a minute, and watch as the person on the other side, visibly annoyed a moment earlier, lit up. They'd tell Dunlevie about the lawyer down the hall who'd become a client, the designer who'd become a co-founder, the friendships they hadn't expected to form. Neumann would flash the grin and move to the next door.

What Dunlevie was watching wasn't performance. The building's profit margins, before overhead, resembled a software company's. Neumann had filled multiple locations through Craigslist posts and cold pitches to strangers at Starbucks, and had built waiting lists. In real estate, that is unheard of. When Dunlevie told his partners what Neumann was selling, he said the word was sex.

The early business worked — that's what the WeWork story makes you forget. The prototype, Green Desk, launched into a financial crisis in 2008 and filled immediately. Co-founder Miguel McKelvey was signing tenants from tape outlines on bare floors before construction was done. In WeWork's first full year, revenue grew fivefold; the company came within $50,000 of breakeven with almost no capital and no advertising. Strangers were becoming collaborators, neighbors were becoming clients. The community Neumann promised was materializing.

So when Benchmark's partners told each other, "Let's give him some money and he'll figure it out," that wasn't naïveté dressed as confidence. It was a conclusion reached after Dunlevie watched something real and felt something real. The delusion that followed didn't grow from nothing. It grew from a foundation that was verifiably there — which is exactly why nobody stopped it in time.

The 'We Over Me' Mission Was Cover for a System Designed to Extract Personal Wealth from Day One

That foundation didn't slow the extraction — it made it invisible.

The question worth asking isn't when Neumann's personal enrichment began to crowd out his genuine mission — it's whether there was ever a gap between them to begin with.

The answer arrives with WeWork's Series B. The company had just raised $40 million, the kind of raise that, in startup orthodoxy, goes entirely toward expansion, hiring, and product. Instead, WeWork lent $9 million of it to We Holdings LLC, the private entity Neumann and McKelvey used to hold their personal shares. Nearly a quarter of the entire raise. Neumann would pay it back, the logic went, once the valuation kept climbing.

The board that approved it consisted of three people: Neumann himself, Benchmark's Bruce Dunlevie (the partner he'd just convinced to write the check), and Steven Langman, Neumann's personal friend and private equity adviser. WeWork was valued at $460 million. The extraction was dressed as a formality. The "we" of WeWork apparently started with Neumann's personal LLC.

The board structure wasn't what made this durable. The rhetoric was. Every time Neumann preached "we over me," every time he told packed company meetings that WeWork belonged to all of them, he was generating social cover for a system running in exactly the opposite direction. Employees who might otherwise have noticed that their CEO was pulling cash from the first major funding round were instead at Raquette Lake in the Adirondacks, singing Journey songs at a company-funded summer camp while Neumann arrived by seaplane. The spectacle of collective belonging was the mechanism of individual extraction.

The $9 million loan wasn't a lapse in judgment. It was a template. The same logic played out across real estate purchases, stock sales, and a proposed $100 billion fund he briefly tried to personally profit from: Neumann on both sides of every transaction, a board too thin or too close to push back, the "we" language covering the tracks. The corruption didn't creep in. It was part of the original design.

Every Institution That Funded WeWork Was Structurally Rewarded for Ignoring What It Already Knew

The investors who funded WeWork weren't deceived by missing information. They were incentivized to discount the information they had.

At Fidelity, someone got it exactly right. An analyst in the private markets group filed a written memo concluding that WeWork was a real estate company masquerading as a technology company, and that the numbers couldn't support a $5 billion valuation. The analysis was correct. The memo was filed. It never reached the two fund managers who would actually write the check.

Gavin Baker and Will Danoff toured a WeWork location where, as planned, every floor was buzzing and packed. Neumann told them he could redesign Fidelity's own offices to feel as alive as this one. By the time they left, both had privately signaled they were in. The analyst's memo was not consulted. The deal went through at $10 billion — twice the valuation her memo had already found indefensible.

The mechanism that overrode her wasn't irrationality. It was a different calculation, running toward a different goal. Baker and Danoff ran active funds at a moment when active management was losing its argument for existence. Index funds were cheaper, and they kept outperforming the professionals. The only defense was finding a company before it went public, priced below what the market would eventually pay. Baker had already watched a rival at T. Rowe Price turn an early Twitter stake into a twenty-times return. He had missed WeWork's previous round. Missing it twice was not a neutral outcome. If Neumann hit $100 billion, Baker and Danoff would look like the fund managers who saw it first. If he failed, each had lost a sliver of a fund that held billions.

If you're the analyst who filed the correct memo, you have no equivalent calculation working in your favor. Skepticism produces no return and earns no credit in a deal that closes without you. Fidelity's internal processes generated the right answer and then routed it away from the people with authority to act on it — not through dysfunction, but through the ordinary logic of how institutions reward seniority. The memo was the system working. The override was also the system working. That's what makes it so hard to find someone to blame.

WeWork Surveyed Its Own Members and Found There Was No Community. Almost No One Changed Anything.

In late 2017, with Neumann preaching community at every all-hands meeting, WeWork's research team surveyed 554 members about their actual social lives inside WeWork buildings. The study, titled "Are Our Members Friends?", found that 69 percent of members had no friends at WeWork whatsoever, measured by even the most generous definition the researchers could construct. Most people didn't know their neighbors' names. The team was so certain they had written the questions badly that they ran the whole survey a second time. The numbers came back the same. Their own written conclusion: community at WeWork was far weaker than anything the company had advertised or believed.

The report went up on WeWork's internal network. Almost nothing changed.

What kept it from mattering was the math that had replaced all other thinking. SoftBank had valued WeWork at twenty times its annual revenue, a multiple that required WeWork to be a technology platform, not a landlord. The community story was the load-bearing wall of that valuation. It didn't need to be real. It needed to be believed — by future investors, by the press, by employees. Neumann himself had told a room of real estate executives that the gap between WeWork's valuation and theirs came down to one thing: "My story." The study proved the story was false. The math still worked as long as nobody stopped telling it.

Masayoshi Son Didn't Just Write the Biggest Check in Startup History — He Told Neumann He Wasn't Crazy Enough

Son had assembled a hundred-billion-dollar fund under pressure to deploy it fast. At that scale, WeWork's story was worth more per dollar of belief than any previous investor had implied.

At a lunch above Tokyo, Masayoshi Son introduced Adam Neumann to Cheng Wei, CEO of Didi, the company that had just beaten Uber across China. Son praised Wei, then turned to Neumann with his verdict: Wei hadn't beaten Travis Kalanick because he was smarter. He was crazier. Son looked directly at Neumann and said: "You're not crazy enough."

The WeWork executives in the room were alarmed. To them, Neumann was already the craziest person they knew. Now the man who had just committed $4.4 billion to his company was telling him to go further. Neumann called friends from Tokyo that night to relay the instruction. When he got home, he repeated it constantly.

The Vision Fund had come together in a single meeting at the Akasaka Palace in September 2016, when Mohammed bin Salman committed $45 billion to Son in roughly forty-five minutes. Son's own summary: "One billion dollars per minute." A fund that size creates a compulsion. Son couldn't wait for deals to arrive. He had to go find them. His method was to meet a founder, feel what he called "the force," offer double what they'd asked for, and threaten to fund competitors if they refused. His staff coached founders to inflate their projections before meetings. Zume Pizza got $375 million after pitching a delivery truck that cooked pizzas en route; its pizza operations closed within the year.

The process selected not for the soundest models but for the most expansive visions. SoftBank had reviewed WeWork the year before, and one of Son's deputies called the fund manager who pitched it "an idiot" for suggesting a no-profit real estate company could scale like tech. Son appeared visibly bored during the pitch. Then Nikesh Arora, Son's former deputy and the loudest internal skeptic of high-risk bets, was pushed out. Six months later, Son committed $4.4 billion to WeWork after a twelve-minute building tour and a car ride, the terms sketched on a scrap of paper in red ink.

The "be crazier" lunch was not a pep talk. It was Son showing his selection criteria: the type of founder who wouldn't flinch when Son later scrawled "$10 T" on an iPad and underlined it twice — WeWork's projected valuation in a decade, one-third of the entire 2018 U.S. stock market. Neumann didn't flinch. He went home and started building.

The Day Anyone Could Read the Prospectus Without a Financial Stake in Believing It, Nine Years of Shared Delusion Collapsed

The S-1 went live at 7:00 a.m. on August 14, 2019. For a few hours, the reception was manageable. Journalists marveled at $1.37 billion in losses in a single half-year, but nobody panicked. Then the reading public found page 199.

WeWork had paid Adam Neumann $5.9 million in stock to transfer the trademark for the word "We" (his own company's name), which he had quietly registered in a personal LLC. When Neumann saw the headlines, he called his CFO and general counsel and screamed at them. Why was that in there? Why didn't they tell him? His general counsel told him she had reviewed every page of the document with him multiple times. Neumann insisted he had never seen it.

What makes this exchange revealing is not the trademark deal itself (the board had already approved it) but the screaming. The people inside the room, including his own legal team, had looked at this payment and waved it through. They had grown accustomed to Neumann's financial entanglements; each one was processed and absorbed and forgotten. The S-1 contained nothing that hadn't already been reviewed by bankers, lawyers, and a board. Nobody had demanded changes.

The difference on August 14 was the identity of the reader. Every prior investor in WeWork had a financial reason to accept the story: venture funds needed exits, banks needed fees, mutual funds needed to show they'd spotted the next Amazon before it went public. Matt Levine, a Bloomberg financial writer, was on vacation when the filing dropped. He had no position in WeWork, no deal to close, no fund to justify. When he read about the trademark, he later wrote that it had caused him to "absolutely lose my mind" — enough that a more dedicated columnist would have caught the next helicopter back to the office.

That's what the S-1 made visible. Private market investors had spent nine years constructing reasons to overlook the entanglements, the governance, the losses. Public market investors, by contrast, had constructed nothing. They had no prior position to protect, no deal already closed that a harsh verdict would retroactively embarrass. The S-1 was designed to persuade fresh eyes. Fresh eyes, it turned out, were exactly what WeWork's story could not survive.

Neumann called it a betrayal. It was closer to an audit. Forty-one days after the S-1 dropped, he was gone.

WeWork Was a Warning That Nobody Heard — The Same Conditions Produced Nikola Months Later

The lesson Silicon Valley drew from WeWork's collapse was that certain founders go too far — not that the system rewarding them remained intact.

Nine months after Neumann's ouster, Nikola Corporation — a six-year-old electric truck company that had not yet manufactured a single truck — went public and reached a $30 billion valuation, eclipsing Ford. Retail investors, many of them first-time traders on Robinhood during pandemic lockdowns, poured money into a company whose founder, Trevor Milton, had painted an expansive vision of remaking American trucking. Milton sold $94 million of his own stock as the company prepared to list, bought a private plane, and purchased an estate where he said he planned an organic farm. Neumann's move, repeated with different paperwork. A short seller eventually published a report alleging that a promotional video showing a prototype truck cruising down a highway was staged: the vehicle had simply been released at the top of a hill. Milton was out within months, still wealthy.

The mechanism was the same. Late-stage private rounds, SPACs (blank-check companies that let startups bypass standard IPO scrutiny), retail trading apps: each creates buyers who arrive without a prior position to protect, floods them with an optimistic story, and exits before the numbers catch up.

WeWork itself negotiated a SPAC deal while its bonds still traded at 30 cents on the dollar. The same company, the same business, the same losses — just a new vehicle to reach investors who hadn't been there the first time.

WeWork exposed a financial system designed to reward a very specific kind of founder — and keep rewarding them even after it said it had learned its lesson.

The Question the Epilogue Refuses to Answer

Adam Neumann invoked the concept of "bread of shame" (the Kabbalistic idea that unearned gifts corrode the soul) to explain why WeGrow teachers didn't deserve raises and household staff shouldn't expect more than they'd been offered. He left WeWork with roughly $185 million as a consulting fee for his resignation, a billion dollars in stock proceeds, and a half-billion-dollar loan to cover the personal debt he'd defaulted on, while more than ninety percent of his employees held options worth nothing. The irony is too precise to be accidental.

The harder question this book circles without answering is which institution in this story would need to change its incentive structure for this not to happen again. The answer is all of them. The evidence, from the SPAC booms that followed to Nikola's $30 billion moment, is that none of them did.