Jim Cramer has a simple piece of advice for WeWork ahead of its initial public offering: "Go away."
What Happened Today
WeWork's valuation may have fallen from $47 billion to a range of $10 billion to $12 billion, sources told CNBC's David Faber.
WeWork also introduced a handful of corporate governance changes ahead of its IPO, including that no member of CEO Adam Neumann's family will sit on the board of directors and his superior voting shares will drop from 20 votes per shares to 10 votes.
Not At Any Price
Even at $10 billion to $12 billion, the company's valuation is too much and the WeWork IPO shouldn't proceed at "any price," Cramer said Friday morning. The high-profile IPO has the potential to "take the air out" of the current favorable sentiment and "screw up the market."
Cramer's second piece of advice for WeWork? Admit the company and valuation is "awful" and come back to the public market when it's "good again."
Bradley Tusk: CEO Wants An IPO
WeWork had no choice but to implement changes if it wants to proceed as a public company, Tusk Ventures founder and CEO Bradley Tusk also said on CNBC. Granted, the company needs to raise $3 billion from the public market to satisfy some debt covenants, but at the end of the day Neumann will greatly benefit.
"Whether he makes $2 billion or $4 billion, if you're him and you just get past all of the normal chatter, of course he is driving this to an IPO," Tusk said. "Why wouldn't he?"
Meanwhile, WeWork has a side business that has potential to become a meaningful driver of growth. The company's WeLive co-living concept addresses real problems like a rapidly urbanizing world at a time when social norms among the younger generation is improving.
"If they can really build that out, to me that is a really interesting business," Tusk said. "The WeWork commercial real estate model as it is, not so much."
WeWork's We Company To List On Nasdaq
Management Pro: Too Much Is Wrong With WeWork
Photo by Ajay Suresh via Wikimedia.
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