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Comment by YeBanKo | Hacker News Reader

Adam Neumann promised to get rich, he got rich. He also mentioned, that his grandkids gonna be on the board and carry his legacy, it is probably true, as he has built generational wealth for them in real estate. He took everyone else for ride. Matt Levine wrote multiple times on Adam Neumann and WeWork. One of my favorite quotes "He lit $10 billion of SoftBank’s money on fire and then went back to them and demanded a 10% commission" [1]. And they kept paying them.

[1] https://www.bloomberg.com/opinion/articles/2019-10-23/how-do...

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I find it remarkable that he manages to escape the spotlight that SBF or Elizabeth Holmes received. I guess the guy knows how to play the hustler game better than all of them.

Did Adam Neumann commit fraud? I don't know his story well enough to comment on that. There's a big difference between fraud and incompetence.

Selling the We trademark for $5.9M to his own company was likely not fraud, but it sure was questionable.

https://www.businessinsider.com/wework-ceo-gives-back-millio...

He certainly didn't hide it. It was in S-1.

I also don't know enough to say much of substance, it appears NYAG was looking at it for a bit but backed off: https://www.reuters.com/article/us-wework-newyork-investigat...

Either way, he is failing upward. With Andreessen Horowitz's blessings this time he's back to rent-seeking schemes, this time it'll be the small people who will experience his flare: https://en.wikipedia.org/wiki/Flow_(real_estate_company)

I expect he'll do it all in the open view, but again the mass land buying-spree he's been on, it can't help but invite disdain for the guy and worry for those who will be in his eye-sight.

Where is a16z getting all of this money to put into weird gambles?

They're super heavy into crypto. That can't be working out for them. Yet they keep writing checks.

If you bought a billion dollars of bitcoin 365 days ago, you have $680M profit today.

There's a fine line between taking advantage of investors and doing so fraudulently.

I don't think it's so fine. I doubt the WeWork guy has (materially) lied to the investors, unlike the FTX guy. I remember him saying that he's building a "physical social network", and everyone seemed in on the game of pretending that this is the hottest thing since the Manhattan project. I.e. WeWork was more like trading shitcoins that don't even promise anything, whereas FTX just robbed people of shitcoins.

The guy didn't lie. There is a big difference.

People forget that the only difference between genius and fraud is success. Succeed, and you will go down not as a liar but making "premature promises"[0]. I believe that generally people like Holmes and SBF actually think they will pull these things off. Just spend an hour or two listening to entrepreneur podcasts and you will identify the source of this kind of culture. We reward truth-bending constantly and listen to founder's stories with awe, but as soon as any of these things fail we are quick to judge the failure.

I think it actually has a lot more to do with the social disgust reaction to a big failure, than any well reasoned distinction between fraud and hustle.

[0] https://www.entrepreneur.com/science-technology/how-steve-jo...

SBF used a random generator to generate the insurance report.

Holmes straight up lied about the result.

Neumann lost company's money too. WeWork is not a success. What are you talking about???

Still, they are not comparable to Neumann.

I haven’t heard about his activities being fraudulent. Absurd and sketchy and outrageous, yes, but not fraudulent.

WeWork was simply a bad idea with bad execution. Theranos as an idea didn’t work at all.

That's not the only way to commit crimes, though. Don't you find it odd that SoftBank kept throwing money at him?

Are you implying that someone from Softbank was getting kickbacks from him?

That's one possibility, but I'm just saying it was odd that they kept throwing money at him.

This whole thing makes me question our economic system.

Yes, we want to reward people who create value. If someone invents a fusion power plant or a cure for cancer, they should get a fat payoff.

But this thing, the guy has gotten paid a lot of money for creating no value.

Of course, investment is a game about uncertainties. People paid him out based on projections that turned out not to happen. You buy a thing, it turns out not to work, you are out money. That seems fair enough too.

But somehow it still seems wrong that a guy can sell a thing that turns out to not do anything useful, and get a similar payoff to someone who eg becomes all-time top musician.

The only thing I can think of that might seem relevant here is that there were relatively few people involved in judging whether WeWork was gonna work. The amounts of wealth concentration make this possible.

Contrast that with Taylor Swift, who still needs to spend her time touring to make her money. She's dependent on the decisions of a large number of consumers.

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