Is WeWork Going Out Of Business in 2023: The Future Outlook For WeWork

Currently, WeWork is not on the verge of going out of business. But substantial concerns exist about its future—particularly its role in the commercial real estate landscape. As of December 2022, an SEC filing reported that WeWork operated a vast 43.9 million rentable square feet globally. Along with 18.3 million of it located in the U.S. and Canada.

However, recent events have cast a shadow on WeWork’s stability. The company’s shares plummeted by more than 25% during extended trading. Later, it openly expressed “substantial doubt” about its ability to continue operations. This alarming situation stems from ongoing financial losses. Or a significant number of members canceling their office space memberships.

These developments came shortly after WeWork’s efforts. So that it can reduce its debt load by approximately $1.5 billion through a deal with significant creditors and SoftBank. Currently, WeWork’s bonds are trading at deeply distressed levels along with its 7.875% unsecured notes due in 2025, selling for just 33.5 cents on the dollar.

WeWork’s journey has been a rollercoaster ride. Once considered one of the most valuable startups in the U.S., it has received substantial investments from venture capitalists. To expand its global real estate presence. However, the company’s troubles began with co-founder Adam Neumann’s unsuccessful attempt to take the company public in 2019. This led to his removal as CEO and a financial rescue from SoftBank Group Corp.

The COVID-19 pandemic dealt another blow. WeWork’s office spaces, emptied during the early months of the crisis, struggled to regain occupancy. In Q2, WeWork reported a decline in occupancy compared to the previous quarter.

Furthermore, WeWork has seen leadership changes. Its CEO, Sandeep Mathrani, left in May to join a private equity firm. Now, the company currently operates under an interim CEO. The board has also changed. It replaced three independent board members replaced by four new ones.

Notably, WeWork has 18 million square feet of office space in the U.S., which may seem relatively small in the overall office space market. However, if WeWork were to default on its lease agreements. It would have a significant impact on the properties associated with WeWork.

WeWork has already initiated location closures, announcing plans in November to exit 40 underperforming U.S. locations. So that it can reduce rent and operational costs this was not an isolated incident, as the company had previously stopped paying rent or terminated lease agreements for multiple U.S. locations so that it can cut costs.

The challenges WeWork faces are compounded by weak leasing demand for office spaces. A trend exacerbated by the shift to remote work during the COVID-19 pandemic. To address these challenges in the coming year, WeWork has laid out a strategy:

  • Reducing Rental Costs: WeWork aims to reduce expenses by renegotiating lease terms and optimizing its real estate portfolio.
  • Negotiating More Favorable Leases: The company plans to secure better lease agreements to improve its financial outlook.
  • Increasing Revenue: WeWork is actively seeking ways to boost its revenue streams. To ensure financial stability.
  • Raising Capital: In addition to cost-saving measures. WeWork intends to secure additional capital through debt issuance or asset sales.

Several major U.S. markets are still grappling with commercial real estate vacancies, including: 

San Francisco, New York, Chicago, and Washington.

However, the coworking industry itself continues to attract demand. As WeWork operates in a highly competitive market today. It offers a variety of options and amenities for those seeking office space.

In summary, WeWork is not currently going out of business. But its future remains uncertain. The company’s journey reflects the unpredictable nature of the business world. Or it serves as a cautionary tale of the risks associated with rapid expansion and financial challenges. Whether WeWork can successfully navigate these challenges. Or adapt to the changing landscape of office real estate remains to be seen. The distinction between WeWork’s financial situation and the broader coworking industry is essential as they involve separate considerations and outcomes. While bankruptcy is possible, it has significant implications for WeWork’s future and its creditors’ claims.

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About WeWork

WeWork Inc. is a company that provides coworking spaces, both physical and virtual—founded in 2010 by Neumann and Miguel McKelvey. WeWork initially promised to revolutionize workspaces and experienced rapid growth. However, over time, its operating expenses increased. It led to reliance on funding from private investors. 

As of December 31, 2022, WeWork operated 43.9 million square feet of space. It has around 779 locations across 39 countries. This included 18.3 million square feet in the United States and Canada. Moreover, it has about 547,000 members who committed to an average term of 19 months.

The company gained significant media attention in 2019. At that time, its parent company, The We Company, attempted to go public with an IPO. However, the IPO faced criticism regarding governance, the business model, and profitability concerns.

WeWork filed for the IPO’s form S-1 in August 2019. At the same time, due to mounting pressure from investors and issues revealed in the S-1 filing. The co-founder, Adam Neumann, resigned as CEO and gave up majority voting control. The company withdrew its S-1 filing and postponed the IPO. Its reported valuation dropped from $47 billion to around $10 billion. As of August 2023, its market capitalization stood at $326 million.

In October 2019, Neumann received nearly $1.7 billion from SoftBank. Due to this, he stepped down from WeWork’s board and severed most of his ties with the company. He continued as a consultant with an annual salary of $46 million.

The New York Times described the failed IPO and related turmoil as an “implosion” in the startup world. It attributed it to Neumann’s questionable leadership and SoftBank’s substantial financial support.

In August 2023, WeWork issued a warning. That warning stated “substantial doubt” about its ability to stay in business as it is possible to file for Chapter 11 bankruptcy protection.

WeWork’s market capitalization was around $260 million. Later, it declined by over 91% year-to-date.

Recent Challenges and Controversies

WeWork is facing a severe crisis, with a real risk of going bankrupt soon. The company is consistently losing money, and customers are canceling their subscriptions. Its value, once at $47 billion, has now plummeted to less than $300 million.

This rise and fall of WeWork serves as a cautionary tale in the history of business. It also raises questions about the judgment of tech venture capitalists—those who often invest large sums in seemingly mundane companies.

Other examples of such investments include: 

  • Greensill was initially touted as a ‘fintech disruptor’ but essentially a lending company.
  • Peloton positioned itself as a ‘tech company merging the physical and digital worlds. But primarily makes exercise bikes with live-streamed videos, and MoonPig, with claims of ‘proprietary algorithms. But a digital printing business.

These investments have cost funds billions of dollars. But none compare to the magnitude of WeWork’s fall. WeWork, once aiming to “elevate the world’s consciousness.” But now it faces a precarious financial future.

The Future Outlook For WeWork

WeWork’s future is uncertain, and concerns about the troubled coworking company are rising. Recently, WeWork raised alarms by stating. “There’s “substantial doubt” about its ability to continue this business operating.” This means they may need more resources to stay in business due to increased member turnover, financial losses, and the need for cash over the next year.

To address its challenges, WeWork recently announced a 1-for-40 reverse stock split. So that it can maintain its listing on the New York Stock Exchange. The value of WeWork shares has plummeted since its IPO in October 2021. A failed IPO attempt two years earlier led to the removal of CEO and co-founder Adam Neumann. WeWork, once valued at $47 billion, now faced investor concerns over Neumann’s erratic behavior and excessive spending.

Despite efforts to turn things around after Neumann’s departure. Including improved annual revenue and cost-cutting, experts believe the risk of bankruptcy remains. This situation raises questions about the impact on the struggling office real estate market.

WeWork still needs to address the possibility of bankruptcy directly. In a statement, a spokesperson emphasized their commitment to members and delivering long-term value.

WeWork stressed the need to improve liquidity and profitability by next year. So that it can ensure its continued operation. Their strategy includes: 

  • Negotiating better lease terms
  • Controlling expenses
  • Raising capital through debt
  • Stock issuance
  • Asset sales

Interim CEO David Tolley expressed optimism about the company’s transformation despite a $349 million loss in the second quarter. Tolley highlighted their focus on the following:

Member retention, growth, real estate optimization, and disciplined cost reduction.


In conclusion, WeWork is currently in substantial doubt to stay in business. Moreover, its future is currently in a precarious state. The company was once valued at a staggering $47 billion. It has faced a series of challenges. Its market capitalization has dwindled to a mere $326 million as of August 2023.

While WeWork has not filed for bankruptcy at the time of writing, the risk of it doing so looms large. Experts hold different opinions on whether the company can recover from its current situation. Some emphasize the possibility, while others remain cautious.

The coworking industry, in which WeWork was once a prominent player. It has evolved and become increasingly competitive. WeWork’s struggles bring attention to the broader shifts in office real estate. It has raised questions about the future of the coworking model.

Whether WeWork ultimately goes out of business or successfully manages to navigate its challenges remains to be determined. However, its journey is a stark reminder of the volatility and unpredictability inherent in the business world. At the same time, the coworking industry will continue to adapt to changing circumstances.