WeWork to cut 4,000 jobs

Office-sharing startup WeWork is planning to cut as many as 4,000 jobs as a part of a turnaround plan put in place by top shareholder Japan’s SoftBank Group, Financial Times reported on Wednesday.
WeWork IPO

The job cut will amount to just under a third of WeWork’s global workforce, and about 1,000 of the cuts will hit employees such as janitorial staff, the report said.

SoftBank agreed to spend more than $10 billion to take over WeWork on Tuesday, giving a near $1.7 billion payoff to the startup’s co-founder Adam Neumann to relinquish control.

WeWork’s new executive chairman Marcelo Claure wrote in a memo to employees on Wednesday that layoffs were in the works at the U.S. office-space sharing start-up following a $9.5 billion rescue financing deal with SoftBank.

“Yes, there will be layoffs – I don’t know how many – and yes, we have to right-size the business to achieve positive free cash flow and profitability,” Marcelo Claure, who serves as SoftBank’s chief operating officer, wrote in the memo.

Marcelo Claure wrote that SoftBank was using WeWork to reimagine its headquarters in Tokyo. He added that he was committed to WeWork doing the same across all SoftBank properties around the world, including some of its portfolio companies.

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