WeWork CEO faces reported boardroom revolt amid IPO turmoil
CGTN

WeWork founder Adam Neumann could be removed as CEO this week, according to media reports suggesting members of the co-working unicorn's board are looking to oust the entrepreneur.

Neumann, who founded WeWork in 2010 and has an estimated net worth of 4.1 billion U.S. dollars, has come under fire over his tight control of decision-making at the company ahead of a planned public listing.

The IPO was postponed last week, as investors voiced concern over losses at the company, as well as Neumann's control and behavior.

A WeWork co-working space in Shanghai. /VCG Photo

A WeWork co-working space in Shanghai. /VCG Photo

According to Reuters, the main challenge to Neumann's authority as CEO is coming from Softbank, one of the biggest investors in WeWork. Japan's Softbank has a 29 percent stake in the co-working firm, after pumping in more than 10.6 billion U.S. dollars into Neumann's company.

Softbank paid for its stake based on the assumption that WeWork was worth around 47 billion U.S. dollars. However, the Japanese group has been frustrated at proposals for WeWork's public listing, which would see the company valuing itself at between 20 and 30 billion U.S. dollars.

Such a drop in valuation would be a major loss for Softbank and its reputation as a leading unicorn investor.

Yet perhaps more problematic for Softbank, and the other members of WeWork's seven-seat board, is the CEO himself.

Neumann has positioned himself as the center of power at WeWork. His shares carry 10 times the voting rights of other investors, in a system that would put Neumann in control of decision-making for the firm. 

According to the company's initial plans for its public listing, Neumann's shares would have had 20 times the voting rights, in a grab for power which has since been rolled back after investor anger.

Neumann speaking in Shanghai, April 2018. /VCG Photo

Neumann speaking in Shanghai, April 2018. /VCG Photo

In the IPO prospectus, the 40-year-old also originally sought to give his wife a veto as a "strategic thought holder" on the successor to WeWork in the event of his death, a move that was also reversed after hostility from stakeholders.

Last week Neumann said that he had been "humbled" by the fallout from WeWork's postponed IPO, and conceded that he had a lot to learn about being the CEO of a major public company.

Neumann also came under fire earlier this month when reports of his drug use came to light. The CEO smoked marijuana on a private jet between the U.S. and Israel last year according to Wall Street Journal, leaving a cereal box stuffed full of the drug on board.

The controversy over Neumann comes after Uber replaced its founder Travis Kalanick as CEO in 2017, following allegations of erratic behavior and unease from investors over his attitude towards sexual assault allegations at the company.

Other young tech entrepreneurs to have had a fractious relationship with investors include Facebook CEO Mark Zuckerberg, who retains control over the company through a controversial dual voting-class share structure, and Tesla founder Elon Musk, who maintains power through a "supermajority" voting system despite only owning 22 percent of the company.

The most famous bid to remove an erratic, drug-taking company founder was the ouster of Steve Jobs from Apple in 1985, a move which was reversed in 1997, resulting in a turnaround in the company's fortunes that made it one of the world's biggest tech giants.