Book Summary: Billion Dollar Loser by Reeves Wiedeman

Adam Neumann, a billionaire entrepreneur, co-founded WeWork with the goal of revolutionizing business and laying the groundwork for a multinational corporation unlike any seen before.

Billion Dollar Loser (2020) by Reeves Wiedeman details Neumann’s frantic rise and WeWork’s subsequent demise. Over a ten-year period, Neumann squandered billions of dollars in investment funds on extravagant lifestyle choices, failed pet projects, and poor management.

Neumann, blinded by pride and ego, founded a business cult that promised to raise global awareness through technology, but the alleged tech giant he created collapsed quickly, forcing him to abdicate.

You may be wondering if you should read the book. This book summary and review will tell you the key takeaways of this book so you can decide if it is worth your time.

At the end of this book review, I’ll also tell you the best way to get rich by reading and writing

Without further ado, let’s get started. 

Billion Dollar Loser Summary

Self-Proclaimed Tech Giant

In the summer of 2011, Adam rented an expensive Hamptons home and told his staff that the expense was justified because they would be able to network with wealthy New Yorkers and investors.

By 2012, Adam had raised approximately $7 million from family and friends, and the company had already received millions from several prominent startup founders. Adam Paltrow’s wife, Rebekah Paltrow, invested heavily in WeWork in the hope that her husband would one day save the world.

Gwyneth Paltrow, her cousin, once predicted that Adam would explode at any time without Rebekah. Rebekah had a significant influence on her husband; she frequently persuaded him to change critical business strategies that he had previously agreed upon with the company’s executives.

WeWork opened its first location in Los Angeles and its fourth in New York in its second year of operation. Adam had lofty goals for his company, claiming it would be the first “real world” social network. Despite the fact that WeWork is not a tech company, he was making inroads into Silicon Valley’s celebrity circles.

Aber Whitcomb, the creator of MySpace and a $100,000 investor in WeWork, claims Adam’s life goal is to become a billionaire like him, and that he enjoys hanging out with other tech industry heavyweights.

Adam had never learned to code and only used computers on occasion, so the idea of him becoming a tech entrepreneur was absurd. His assistants had to deal with his emails and texts, which often looked like code due to his dyslexia.

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A Billion-Dollar Lie

WeWork needed significant capital to expand as promised by Adam, for things like leased space, regular operations, and renovations. As the offers of investment money piled up, Adam became more discerning. When Airbnb was worth more than $2 billion, Goldman Sachs offered to invest $220 million, but he refused.

The majority of WeWork’s employees thought Adam was stupid for turning down the Goldman Sachs offer, which could have served as validation of the company’s success. WeWork desperately needed this cash infusion because it was running low on cash. But Adam was unwavering in his pursuit, preferring to look elsewhere.

Following a $440 million Series B funding round in 2013, WeWork’s headquarters relocated once more, this time to Broadway. In 2014, the company’s valuation increased to $1.5 billion after receiving funding from JPMorgan and other investors. Nobody could understand how it had progressed so quickly in only four years.

Hyperambitious

WeWork needed significant capital to expand as promised by Adam, for things like leased space, regular operations, and renovations. As the offers of investment money piled up, Adam became more discerning. When Airbnb was worth more than $2 billion, Goldman Sachs offered to invest $220 million, but he refused.

The majority of WeWork’s employees thought Adam was stupid for turning down the Goldman Sachs offer, which could have served as validation of the company’s success. WeWork desperately needed this cash infusion because it was running low on cash. But Adam was unwavering in his pursuit, preferring to look elsewhere.

Following a $440 million Series B funding round in 2013, WeWork’s headquarters relocated once more, this time to Broadway. In 2014, the company’s valuation increased to $1.5 billion after receiving funding from JPMorgan and other investors. Nobody could understand how it had progressed so quickly in only four years.

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Masa’s Protégé

Son Masayoshi, the Softbank conglomerate’s founder, was born in Tosu, Japan, in 1957. He had already decided in middle school that he wanted to be a powerful businessman in Japan.

He met Adam on a business trip to India in 2016. Adam informed him of his company’s tremendous success and the impending opening of the one hundredth WeWork location. After their initial meeting went well, the two businesspeople continued their discussions about a potential investment for several months.

Despite his reservations, Masa was very impressed by WeWork’s growth. Softbank, as it turned out, invested $4 billion in WeWork. Adam’s big dreams were inspiring, but he frequently seemed out of touch with reality.

After the Softbank deal closed in 2017, he began boasting to his friends that he would be the wealthiest person they would ever meet. He believed strongly in WeWork’s ability to improve the world, but according to his employees, he consistently avoided dealing with the company’s fundamental issues in the hope that they would resolve themselves.

A Patchwork Company

WeWork opened its 200th location in Singapore in December 2017, exactly one year after it opened its 100th in Berlin. WeWork was still venturing into markets where it had no prior experience, despite having already expanded to five continents.

The company was still patched together, but revenue and expansion were priorities. There was no sales department, no sales personnel, and no training programs. According to his detractors, Adam and WeWork’s success is due more to his ability to tell a compelling story than to his actual expertise. The comments enraged Adam, especially those made by landlords whose buildings he rented space in.

In 2017, Adam had a chance meeting with Elon Musk, a tech tycoon and billionaire, at SpaceX’s headquarters in Los Angeles. He explained that humans could establish a sustainable colony on Mars with the help of WeWork. Musk, on the other hand, declined the offer, explaining that he didn’t need his company’s help.

The gathering disappointed Adam. Despite the fact that many of its members worked in technology, Silicon Valley powerhouses did not see WeWork as a true startup. Adam purchased five businesses in six months after realizing he would never be able to make it to Silicon Valley on his own. He is best known for acquiring the popular social networking site Meetup.

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A Huge Mess

WeWork had run out of money again by the end of 2018. Adam didn’t seem to mind the company’s mounting losses. Adam was adamant that WeWork was worth $1 trillion if it stuck to its mission, and revenue was still doubling every year. Adam was absent from many board meetings that year, during which WeWork’s directors expressed their concerns about the company’s rapid growth.

As more employees left WeWork, it became clear that working there had been both thrilling and perplexing for the vast majority of them.

Despite the fact that they had seen many problems and desperately wanted Adam to be brought back down to earth, Adam’s real estate colleagues were hesitant to speak up. WeWork had already begun its IPO battle, which some saw as a day of reckoning for Adam and his business methods.

Adam insisted on WeWork continuing to grow because the company had reached the point where it would default on more than $3 billion in commercial debt securities if it failed. At this point, WeWork was opening two new locations every day, signing dozens of leases each week, and hiring hundreds of new employees every Monday. Adam was willing to take his company in a more risky direction than in the past.

Uncertainty about the company’s actual offerings only fueled people’s skepticism. WeWork’s public relations and communications teams spent the majority of 2019 racking their brains for a succinct way to explain the company in a single page. The rebranding effort under the guise of raising global consciousness to We had deteriorated to the point where Adam considered quitting.

When We Failed

According to major New York banks, the issue with WeWork is Adam. They weren’t sure what to make of his actions. Because of WeWork’s precarious position, its founder has emerged as the company’s most serious threat. Adam was irritated and overburdened. Both his reputation and his company’s IPO tanked. Softbank, JPMorgan, and other investors had long supported Adam.

They finally turned on him after his actions began to undermine their own credibility. Despite having to resign, his fate had already been decided, and he retained control of the company. After he resigned, Sebastian Cunningham and Artie Minson took over as co-CEOs.

Following their appointment, WeWork ceased operations at several companies it had acquired while Adam was CEO. His ambition to make his startup as successful as Amazon became a running gag.

Masa’s confidence in his protege had dwindled, even in his own eyes. Softbank asked Adam to leave WeWork. Nothing good seemed to be able to improve his situation.

Billion Dollar Loser Review

Reeves Wiedeman’s writing is direct and to the point, focusing on the evolution of the WeWork concept and Adam Neumann’s magnetic persona in relation to that evolution. His arrangement is simple and chronological. Wiedeman spent eighteen months conducting interviews with current and former WeWork employees as he prepared and reported Billion Dollar Loser. Many direct quotations from the interviews, as well as some paraphrases, are used.

About The Author

Reeves Wiedeman is the editor of New York Magazine and has written for the New York Times, New Yorker, and Rolling Stone. In early 2019, he began researching Billion Dollar Loser while working on a New York Magazine article titled “The I in We.”

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