From Vision to Reality: A Strategy Analysis of WeWork
While working on Keystone Homes, I spent a lot of time thinking about real estate not just as physical space, but as a product shaped by incentives, strategy, and execution. As part of EM 253: Innovation and Tech Strategy, I had the opportunity to write a strategy analysis paper and wanted to apply the framework to a company operating in a space I was actively learning from. I chose WeWork as a case study, examining its rise, collapse, and attempted turnaround through the lens of strategic discipline. This paper analyzes how WeWork’s ambition outpaced its execution, evaluates its current strategy using Rumelt’s “good strategy” framework, and outlines what a more grounded, sustainable path forward could look like.
Introduction & Executive Summary
At WeWork’s Manhattan headquarters, the conference rooms have names like “Kombucha Capital,” “The Think Tank,” and “Hustle & Flow.” Once, they rang with the clatter of MacBooks, rapid-fire pitches, and the occasional guided meditation. Glass walls framed scenes of standing-room brainstorms, barefoot founders sketching billion-dollar ideas, and high-fives over cold brew. These weren’t just meeting rooms, they were stages for a company that believed it was reinventing work. Today, those same spaces sit in awkward silence. The beanbags are undisturbed, the kombucha tap still flows, but fewer people stop to pour a glass. They’re quiet reminders of a company that tried to reshape the modern office, and instead became a case study in the dangers of too much vision and not enough discipline.
In 2019, WeWork was the unicorn to end all unicorns: a coworking startup with a $47 billion valuation and a founder who fancied himself a philosopher-king. Adam Neumann, with his messianic charm and barefoot boardroom energy, promised not just desks and whiteboards but a reimagining of human consciousness. Then came the IPO filing, a 260-page fever dream of ambition, related-party transactions, and staggering losses. The valuation collapsed. The IPO was scrapped. Neumann was ousted.
Since then, WeWork’s been the corporate equivalent of a rock star in rehab – famous, troubled, trying to convince people it’s changed. Under new leadership, it quietly rewrote its playbook, restructured its business model, and sought redemption in a world permanently altered by the pandemic and the rise of remote work. Whether it’s actually turned the corner, or just delayed the inevitable, is still up for debate.
Now, after a spectacular fall from grace and a Chapter 11 bankruptcy in 2023, WeWork is attempting a comeback. The new strategy ditches the grandiosity by opening fewer locations, writing restructured leases, and relying on a back-to-basics focus on high-occupancy, flexible workspaces. For the first time, it seems to have a plan grounded in reality. But survival isn’t guaranteed. This paper analyzes how it all unraveled, evaluates the company’s current strategy through Rumelt’s “good strategy” framework, and lays out a path forward that’s leaner, smarter, and finally sustainable.
Background
WeWork’s 2010 founding promised to reinvent the traditional office as a vibrant community. The company, co-founded by Adam Neumann and Miguel McKelvey in New York, began by leasing large commercial spaces and subdividing them into trendy, amenity-filled coworking hubs designed for freelancers and startups. WeWork’s core business model was essentially an office subleasing business. The company acquired long-term leases from commercial buildings in prime city locations, and offered flexible short-term memberships to clients. Its core value proposition offered “flexible, on-demand workspaces tailored to the modern workforce – giving companies and individuals access to professional offices without the burden of long-term leases”.
However, the founders saw WeWork as more than just a real estate firm. WeWork crafted its identity as a transformative enterprise with a profound mission, branding itself as a “physical social network” called “WeUniverse”, showing WeWork’s aspiration to eventually encompass all aspects of people’s lives. Furthermore, WeWork branded itself as a technology company and emphasized technological integrations and innovations within its operations at its coworking spaces. In this way, these strategic brandings aimed to align WeWork with the valuations and perceptions typically afforded to tech companies, distinguishing it from traditional real estate firms and appealing to investors seeking innovative, mission-driven employees.
Initial Successes
In 2010, WeWork opened its first location in New York City. By 2019, on the eve of its IPO, it had reached approximately 850 locations worldwide, becoming the largest office tenant in both Manhattan and London. Substantial investments by various backers fueled this rapid expansion, including a Series A funding round with $17 million in 2012. The most notable investment came from Japanese conglomerate Softbank, which invested over $10 billion into the company between 2017 and 2019. At its peak, WeWork leveraged these investments into a $47 billion valuation, before the company unraveled into one of the most infamous downfalls of the decade.
Behind Closed Doors
Yet, beneath the towering valuation and bold promises, the underlying business showed signs of deep structural instability. WeWork’s initial strategy and business model brought rapid revenue growth but “leaked money like an uncaulked ship”, as one observer stated, due to the staggering costs of leases, build-outs, and upscale perks. In 2019 alone, the year that WeWork rebranded itself as “The We Company”, the firm lost about $1.6 billion on $18 billion in revenue, confirming that its “growth at all costs” strategy came with extraordinary costs indeed.
Additionally, WeWork’s cultural aura was as attention-grabbing as its financials. Neumann, a charismatic presence who often walked the office barefoot, cultivated a cult-like workplace culture. He preached about making a “life, not just a living” and was not shy about blending work with partying, holding 2 a.m. meetings with tequila shots and weed-fueled celebrations. This bombastic style not only helped drive WeWork’s mystique, but also masked serious governance red flags. WeWork’s S-1 filings revealed serious conflicts of interest: Neumann had trademarked the word “We” and charged the company $5.9 million, and he profited as a landlord by leasing his own buildings to WeWork. As these details emerged, the mythos of WeWork as a transcendent tech unicorn began to crumble.
Failed IPO, CEO Ousting, & Eventual Bankruptcy
On the eve of WeWork’s IPO in 2019, WeWork appeared to go public as one of the world’s most valuable startups. But, as soon as the company’s S-1 filing became public, the IPO unraveled in real time. Within weeks, the company’s valuation collapsed from $47 billion to under $10 billion. The IPO was officially pulled, and under mounting pressure from investors, Neumann was ousted as CEO and forced to resign, walking away with a $1.7 billion exit package while thousands of employees were laid off.
The timing of WeWork’s explosion could not have been worse. Just months later, the COVID-19 pandemic emptied offices worldwide. Under new CEO Sandeep Mathrani, a veteran real-estate turnaround specialist appointed in early 2020, WeWork scrambled to cut costs, renegotiate leases, and shed non-core ventures. Occupancy at WeWork centers plunged to around 47% in early 2021 amid lockdowns, forcing the company into survival mode. In October 2021, WeWork managed to score an improbable second chance on Wall Street. WeWork went public via a SPAC merger at a roughly $9 billion valuation, less than one-fifth of its initial valuation but a symbolic victory following its original fiasco.
Yet the gulf between WeWork’s founding vision and its financial reality persisted well after it went public. In 2021, it generated $2.57 billion in revenue but lost $4.63 billion; in 2022, revenue rose to $3.25 billion and losses narrowed to $2.3 billion. The company reached 75% occupancy by the year’s end and even had one month of positive EBITDA, but quarter after quarter, the losses continued. By mid-2023, WeWork had burned through another $696 million, its cash reserves were shrinking, and its enterprise-heavy membership base couldn’t make up for the crushing weight of its long-term leases. In August of 2023, WeWork warned of “substantial doubt” about its ability to continue operating. By November, with its stock near worthless and over $25 billion in lease and rental obligations looming, WeWork filed for bankruptcy protection. Finally, after restructuring its debts and shedding a significant portion of its lease obligations through Chapter 11, the company finally had room to reset.
Current Strategy
By 2024, it seemed like WeWork had finally turned a corner. For the first time since its founding, the company appears to be meeting Rumelt’s test for a good strategy: It has identified a clear, fundamental challenge, an unsustainable, lease-heavy model in a world transformed by hybrid work. Rather than chasing hypergrowth or lifestyle branding, WeWork’s new approach centers on operational discipline and aligning its core product with today’s demand for flexibility. The company has aggressively scaled back its real estate footprint, exiting or renegotiating nearly 90% of its leases, closing 150 to 170 underperforming locations, and concentrating on roughly 600 viable sites globally. This restructuring effort reduced its future rent obligations by about 40%, shedding over $4 billion in debt, and securing $400 million in new equity to fund the turnaround.
Under new leadership, WeWork has articulated a realistic theory of action: focus on its flexible workspace offering, target enterprise clients who need agility, and lean into short-term, hybrid-friendly options like “On Demand” memberships. CEO John Santora has framed flexible work as a “strategic imperative,” reflecting a shift from aspirational messaging to grounded, customer-centric execution. Importantly, management has set a clear financial target: after a modest loss in 2024, the company projects its first-ever profit, around $100 million in 2025, made possible by its streamlined cost base and a tighter focus on performance. Whether WeWork can fully capitalize on the disruptions reshaping commercial real estate remains to be seen, but for now, the company is doing something it never quite managed before – acting like a business with a strategy rooted in reality.
Proposed Action & First Steps
To keep momentum, WeWork’s next chapter needs to be about making every remaining location count. The path forward will not be about scaling fast, as it did in its early days, but scaling smarter – leaner, asset-light, and margin-conscious, more Airbnb style than real estate empire. That means evaluating every site for profitability, closing underperformers, and aggressively marketing vacant space in well-located buildings. The goal is no longer volume but a portfolio of healthy, high-occupancy hubs. At the same time, market uncertainty has created an opening: demand for flexible offices is rising, and record levels of unoccupied commercial real estate in major cities have made landlords more open to creative deals. WeWork is in a prime position to capitalize by striking partnerships that introduce revenue-sharing models, management agreements, and anything that breaks from the fixed-rent model that once broke the company. All of this must be done under rigorous financial discipline, a sharp departure from the days of burning cash to chase a blurry, idealistic vision.
But real recovery means more than cutting costs, it means rebuilding trust and filling desks. The fastest-growing customer segment remains corporate enterprise clients, and WeWork should continue leaning into them with discounted trials and tailored deals. Simultaneously, it cannot afford to alienate the freelancers and startups that once built its brand; month-to-month plans, community perks, and flexibility are the way back in. If the old WeWork was about vision, the new one should be about execution. The story now is not about promising to change the world, it’s about proving it can run a sustainable business within one.
To close the loop, the company needs more than internal discipline, it needs to communicate clearly and consistently with the outside world. Quarterly updates and transparent milestones should be standard practice; not just investor relations fluff, but a visible sign that the company is serious about accountability and rebuilding trust. Moreover, WeWork needs a real rebrand to put itself back on the map. Right now, the name still conjures a wince and a raised eyebrow: the tequila-soaked boardrooms, the failed IPO, the billion-dollar bailout. If the company wants people to walk into a WeWork without thinking about the mess it used to be, it needs to reset the narrative. That could mean bold leadership changes, refreshed visual identity, and messaging that leans into humility, competence, and trust;Less about elevating consciousness, more about showing up with desks that work and teams that deliver. Reintroducing WeWork to the public as a reliable, flexible, and modern office solution, not a cautionary tale, will be just as critical as getting the numbers right.
Conclusion
WeWork was founded on the compelling idea that workspaces could be more than desks; they could be communities. But that vision was thrown away in a whirlwind of overreach, ego, and unchecked spending. Now, stripped of the spectacle and restructured through bankruptcy, WeWork has one last chance to get it right. Its next chapter must be about execution, not elevation, making every location profitable, building trust with transparency, and showing that flexibility doesn’t have to mean fragility. If it can stay lean, stay focused, and serve the actual needs of a hybrid workforce, WeWork won’t just survive but it might finally become the company it always said it was.
