The Story of Adam Neumann, The Founder of WeWork

Adam Neumann born on April 25, 1979 is an Israeli-American businessman. In 2010, he co-founded WeWork with Miguel McKelvey.

The Neumann family, from Israel, is of Ashkenazi Jewish descent. Neumann’s parents, both physicians, Avivit and Doron Neumann divorced when he was seven years old. He and his younger sister, Israeli model Adi Neumann, moved to the United States with their mother for her medical residency. Due to his dyslexia, Neumann could not read or write until third grade. In 1990, after four years in the US, they returned to Israel and settled in kibbutzNir Am. He graduated from the Israeli Naval Academy and served as an officer in the Israeli Navy for five years and was discharged with the rank of seren (captain). He later attended the Zicklin School of Business at Baruch College in New York City.

Prior to founding WeWork, Neumann founded a children’s clothing company, Krawlers. Neumann and McKelvey began working together, having met through a mutual friend, on Green Desk in 2008, a shared-workspace business focusing on sustainability, the precursor to WeWork. The pair sold their interest in Green Desk and using the funds along with a $15 million investment from Brooklyn real estate developer Joel Schreiber for a 33% interest in the company, they founded WeWork in 2010. Neumann stated that with WeWork, he intended to replicate the feeling of togetherness and belonging he felt in Israel and that he thought was lacking in the West.

According to the Wall Street Journal, Neumann chartered a Gulfstream G650 for a trip from the United States to Israel during the summer of 2018. During the flight, Neumann and his friends spent much of the flight smoking marijuana. After the flight landed in Israel, the flight crew found a cereal box stuffed with marijuana and reported it to the jet owner. Fearing a marijuana trafficking incident, the owner of the jet ordered it to return to the US. Neumann and his friends had to book a separate flight back.

In 2018, WeWork faced a lawsuit from a former employee who identified issues of sexual harassment and other inappropriate behaviors in the workplace. In her statement, she mentioned that Neumann “plied [her] with tequila shots during her interview with the company.” Shortly after this claim was made, WeWork put an end to its unlimited beer for employees and implemented a policy of only four beers per day in the New York office.

On September 22, 2019, there were reports, from outlets such as the Wall Street Journal, that various WeWork directors were planning on asking Neumann to step down as CEO, after “a tumultuous week in which his eccentric behavior and drug use came to light” before a planned IPO. The Wall Street Journal reported that he had taken $700 million out of WeWork before the IPO, among other details, and “undermined his position” at the company. Neumann also repaid $5.9 million that the company had paid him in exchange for his trademark of the word “We”. On September 24, 2019, he resigned and Artie Minson and Sebastian Gunningham were named as successors.

In October 2019, the Wall Street Journal reported that Neumann would receive close to $1.7 billion from stakeholder SoftBank for stepping down from WeWork’s board and severing most of his ties to the company. Weeks later, minority shareholders filed a lawsuit against Neumann and other WeWork officials for breach of its fiduciary duties. On 5 March 2021, Forbes listed his net worth at US$750 million, having dropped off the Forbes billionaires list in 2020.

Investments

In 2012, Neumann partnered with Ken Horn of Alchemy Properties and Joel Schreiber and purchased for US$68 million the top floors of the Woolworth Building, which they then converted into condominiums.

In 2018, Neumann became a partner of InterCure, an Israeli cannabis company led by Ehud Barak, former Prime Minister of Israel.

Neumann has purchased buildings and then leased the space back to WeWork. Observers noted this as a potential conflict of interest and one that would not be allowed if WeWork were a public company.

In early 2020, Neumann invested US$10 million into multimodal shared mobility company GOTO Global, taking a 33% equity stake in the company.

During his tenure as CEO of WeWork, Neumann purchased US$90 million worth of residences, including a 60-acre (24 ha) estate in Westchester County, New York, a 6,000-square-foot (560 m2) condominium near Gramercy Park, two homes in The Hamptons, and a US$21 million mansion in Corte Madera, California.

Neumann has begun purchasing apartment buildings, and as of early 2022, owned some 4,000 apartments worth about US$1 billion.

SOURCE

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