Andrew Ross Sorkin writes about the fallout from the collapsing IPO of WeWork, following the semi-resignation of founder Adam Neumann (he is staying on as Chairman), quoting VEA Vice Chair Nell Minow, who appeared with Sorkin on CNBC yesterday to discuss the IPO.
His ouster may force a reckoning at several longtime WeWork backers:
• JPMorgan Chase had long courted both the company and Mr. Neumann as clients, Andrew notes in his latest column. That gave the bank deep insights into WeWork — and should have given it pause about potential conflicts of interest like certain deals that Mr. Neumann cut with the company.
• JPMorgan “had to know” about Mr. Neumann’s self-dealing and other behavior, Nell Minow, a corporate governance expert, told Andrew. “That’s literally their job. And if they didn’t, they were beyond negligent.”
• Benchmark ultimately agreed that Mr. Neumann must go. But that makes WeWork the second time that the famed venture capital firm moved to oust the founder of a company it has backed. That raises questions about whether it could lose out on future investment deals, the WSJ notes.