The We Company, Owner of online workspace provider, WeWork, founded back in the 2010s and headquartered in New York City, had been contemplating a downsizing of its IPO (Initial Public Offering) valuation to a lump-sum of $20 billion, much-lower than an initial estimate of $47 billion the company achieved over a fundraising campaign in January this year, at least two people with direct knowledge regarding the subject-matter had unveiled on Thursday, the 5th of September 2019.
In point of fact, latest WeWork decision to slash its IPO valuation had been suggesting a growing scepticism circulating around the NY-based online office space provider’s ability to generate profit, while the company’s co-founder, Adam Neumann’s stiffer grasp over the governance of the company alongside an open-secret bitterness on WeWork’s management board about the issue had been weighing on prospects of WeWork IPO, suggested analysts.
Aside from that, other high-profile public market listing of Uber and Lyft had been performing rather poorly following their much-downsized IPO due to a lack of roadmap to profitability, while investors must not be blamed to show extremely scepticism on Silicon Valley Unicorns lacking a concrete plan towards profitability, suggested one of the sources briefed directly over the issue.
Meanwhile, addressing to a growing disbelief among the investors following IPOs of Uber and its smaller rival Lyft Inc., a real estate analyst at DA Davidson & Company, Barry Oxford said, “The market has changed very much since Uber and Lyft went public.
What investors want now is an appropriate discount to price in the risk and have greater comfort that it won’t fall below the IPO price. ”