By Catherine Thorbecke | CNN
WeWork, the beleaguered coworking space company, has filed for bankruptcy, marking a stunning downfall for what was once the world’s most valuable startup.
The Chapter 11 bankruptcy announcement was widely expected after the company said last month it was struggling to pay back its debt. The pandemic rocked WeWork as people started working from home instead of commuting into office spaces. The company’s stock lost more than 99% of its value, and the SoftBank-backed venture, which was privately valued at around $47 billion at its peak, was worth $45 million Monday before its bankruptcy filing.
WeWork said it would remain open and operational as it renegotiates its leases and debt obligations. The company said late Monday that investors holding 92% of the company’s secured debt have agreed to adjust the terms of their loans to help the company remain in business.
“A big lesson that startups should learn from the WeWork downfall is that high valuations almost always cause more hurt than benefit. It sets unrealistic expectations.” -Shruti Gurudanti, Rose Law Group partner and director of corporate transactions
