WeWork Founder Adam Neumann Is Out the Door—His Friends May Be Next
As WeWork seeks to shape up and slim down for a second run at going public, the company is seeking to sell off a trio of businesses it’s acquired in recent years, laying off potentially thousands of workers. Another casualty of its stalled IPO: it’s selling off the company’s private jet.
One of the companies on the chopping block is Conductor, an SEO marketing platform that WeWork acquired in early 2018, as first reported by the Information.
In an effort to promote its tech bona fides, WeWork had maintained that its small-business members would benefit from having access to a company-alligned SEO shop to get their operations noticed. Internally, employees and executives greeted the investment with raised eyebrows. Conductor was acquired for roughly $126 million in WeWork stock and some cash, according to the company’s prospectus.
One point that jumped out to employees and executives at the time of the acquisition: Conductor CEO Seth Besmertnik and WeWork CEO Adam Neumann had been friends since their days at Baruch College. This fact was prominently mentioned in the press release announcing the deal.
It fed into a larger narrative about Neumann’s business instincts. The founder had been known to place friends and family in positions of power. His wife, Rebekah Neumann, was initially given significant power to choose WeWork’s next CEO, though investors balked at that idea, and the company has reportedly taken it off the table.
Vice President of Operations and Special Projects Zvika Shachar is known to be a childhood friend of Neumann’s while Director of Development Roni Bahar reportedly went to university with the founder, as previously reported by Bloomberg.
It’s also widely known that Chris Hill, the Chief Product Officer and CEO of WeWork Japan, is Neumann’s brother in law, according to sources. He has since left the firm, alongside a long-time friend of Neumann’s, Michael Gross. Gross was vice chairman of the firm.
Adam Kimmel, the company’s Chief Creative Officer, was also known to be close friends with the Neumanns, according to sources.
WeWork meanwhile also plans to sell off two other businesses: Meetup and Managed by Q, also reported by the Information. The company is also seeking to reduce headcount by between 2,000 to 3,000 employees in the process, a source tells Fortune.
WeWork declined to comment.
More must-read stories from Fortune:—Airbnb plans huge IPO in 2020, continuing push by tech companies to go public
—What’s the difference between a recession and a depression? Here’s what history tells us
—Why the next recession may feel very different than 2008
—Why the repo market is such a big deal—and why its $400 billion bailout is so unnerving
—Apple Card: Here are all the credit card’s 3% cash back benefits partners
Don’t miss the daily Term Sheet, Fortune’s newsletter on deals and dealmakers.