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Speaker 1: This is Mesters in Business with Very Results on Bloomberg Radio.

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Speaker 1: This week. On the podcast, I have a special guest.

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Speaker 1: Her name is Maureen Farrell, and she is the co

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Speaker 1: author of the book Cultive, We We Work, Adam Newman

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Speaker 1: and the Great Startup Delusion. I read this book a

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Speaker 1: couple of weeks ago and just plowed through it. It's

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Speaker 1: a lot of fun. Everything you think about we Work

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Speaker 1: is actually even crazier and more insane and more delusional

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Speaker 1: than than you would have guessed. All the venture capitalists

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Speaker 1: and and big investors not really doing the appropriate due diligence,

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Speaker 1: relying on each other, and nobody really looking at the numbers,

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Speaker 1: which kind of revealed that this was a giant money losing,

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Speaker 1: fast growing startup that really was a real estate play

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Speaker 1: pretending to be a tech play. You know, tech gets

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Speaker 1: one sort of multiple, real estate gets a much lower multiple.

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Speaker 1: And Newman was able to convince a lot of people

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Speaker 1: that this was a tech startup and therefore worthy of

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Speaker 1: a you know, a billion dollar and then multibillion dollar valuation.

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Speaker 1: It's fascinating the it's deeply deeply reported. There is just

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Speaker 1: an incredible series of vignettes and stories and reveals that

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Speaker 1: they're just shocking what Newman and Company were able to

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Speaker 1: fob off on their investors. Everything from ridiculous self dealing

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Speaker 1: um to crazy evaluations, to lackluster due diligence, and then

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Speaker 1: just the craziest, most egregious golden parachute in the history

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Speaker 1: of corporate America. I found the book to be just

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Speaker 1: fascinating and as well as my conversation with Maureen. So

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Speaker 1: with no further ado, my conversation with Maureen Farrell, co

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Speaker 1: author of the Cult of Wheat. This is Mesters in

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Speaker 1: Business with Very Revolts on Bloomberg Radio. My special guest

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Speaker 1: this week is Maureen Farrell. She is the co author

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Speaker 1: of a new book, The Cult of We We Work,

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Speaker 1: Adam Newman and the Great Startup Delusion. The book has

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Speaker 1: been nominated for a Financial Times Mackenzie Business Book of

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Speaker 1: the Year Award. UH. Previously, she worked at the Wall

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Speaker 1: Street Journal since two thousand and thirteen. Currently she is

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Speaker 1: a reporter investigative reporter for The New York Times. Maureen Farrell,

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Speaker 1: Welcome to Bloomberg. Thank you so much for having me.

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Speaker 1: So let's uh start a little bit with your background

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Speaker 1: in history. You you covered capital markets and I p

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Speaker 1: O s at the Wall Street Journal. What led you

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Speaker 1: and your co author Elliott Brown to this story because

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Speaker 1: this was really a venture capital on a startup story

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Speaker 1: for most of the right exactly and for me personally,

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Speaker 1: I was covering the I p O market and end

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Speaker 1: capital markets, this sort of explosion of private capital. So

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Speaker 1: I was looking at we work from both angles basically, um,

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Speaker 1: you know, in this small cohort of the most interesting

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Speaker 1: companies that were going to go public, along with Uber,

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Speaker 1: Airby and be Lift, and it was also part of

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Speaker 1: this group that had raised more capital than anyone ever before.

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Speaker 1: I was looking at soft Bank and its vision fund

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Speaker 1: a lot um and then I mean take within this cohort,

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Speaker 1: there were some pretty interesting companies. But I mean just

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Speaker 1: along the way kept on hearing. You know, Adam Newman

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Speaker 1: stood out as like a little bit of a different

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Speaker 1: um entrepreneur that the stories you would just hear over

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Speaker 1: time just became more and more interesting and a little insane.

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Speaker 1: So when did you decide, hey, this is more than

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Speaker 1: just a recurring series of articles. When did you say

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Speaker 1: this is a book. We have to write a book

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Speaker 1: about this. So we were around August twenty nineteen. Um.

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Speaker 1: By then we were writing more and more about the

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Speaker 1: company as it was clear that it was you know,

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Speaker 1: made it known that it was going to go public.

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Speaker 1: Suddenly it's s one the document the regulatory documents you

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Speaker 1: file publicly to go public. Um, we're out there and

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Speaker 1: they were completely bonkers. They sort of captivated, I think

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Speaker 1: the imagination of the business, uh reading public. But then

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Speaker 1: over the next few weeks we work was on its

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Speaker 1: way to finally doing this I P. O. And my

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Speaker 1: co author, Elliott and I who had been covered He

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Speaker 1: had been covering the company long before me. He was

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Speaker 1: a real estate reporter. He had been covering them since then.

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Speaker 1: He was out in San Francisco covering venture capital, and

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Speaker 1: it just became the most insane story either one of

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Speaker 1: us had ever reported. Like day by day, there's a

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Speaker 1: playbook for I p. O s and they, you know,

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Speaker 1: things are different, but they sort of follow a formula

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Speaker 1: and nothing was making sense, and um, it just was

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Speaker 1: getting more and more insane until this IPO was eventually

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Speaker 1: called off and Adam Newman, the founder and CEO, was

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Speaker 1: pushed out of the company for all sorts of crazy things.

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Speaker 1: So we're gonna we're gonna spend a lot of time

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Speaker 1: talking about that, But you hinted at something I have

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Speaker 1: to mention. Your co author covered real estate. Hey, I

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Speaker 1: was told we work was a tech startup and an

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Speaker 1: AI company and everything else, but a real estate arbitrage play.

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Speaker 1: How did they manage to convince so many people that

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Speaker 1: they weren't a Regius? The CEO of Regis very famously said,

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Speaker 1: how is what they do any different than what we do? Well,

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Speaker 1: they tried to convince Elliot Brown, my co author of

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Speaker 1: the same thing. He had heard about Adam Adam Newman

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Speaker 1: this company. He started seeing the valuation um back then

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Speaker 1: I think it was a billion one point five billion,

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Speaker 1: and when that became a unicorn, suddenly it was like, wait,

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Speaker 1: this is just a real estate play exactly. And he

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Speaker 1: was covering other commercial real estate companies like Regius, and

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Speaker 1: he had followed them and he was like, wait, they

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Speaker 1: only have a couple of locations to even still at

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Speaker 1: that point. So he went in to meet Adam Newman

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Speaker 1: for the first time, and he's got great stories, but

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Speaker 1: as part of it, Adam was like really horrified. He was,

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Speaker 1: you know, very nice, his charming self, but also saying, hey,

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Speaker 1: you're a real estate reporter for the Wall Street Journal.

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Speaker 1: You're the last person who should be covering this company.

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Speaker 1: Do you have someone who covers like community companies? And

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Speaker 1: Elliott said no, and I'll be following you from here

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Speaker 1: on out. We'll talk about community adjusted even though a

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Speaker 1: little later also. But but let's talk about the genesis

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Speaker 1: of this because uh, Newman and his partner McKelvey had

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Speaker 1: a legit business green Desk that was the predecessor that

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Speaker 1: we work. It was sold. I don't know what the

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Speaker 1: dollar room that was. Was that ever disclosed, but it

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Speaker 1: was not nothing. It was a real and the two

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Speaker 1: of them rolled that money plus a third partner who

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Speaker 1: was also Joel Riber is a real estate developer in

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Speaker 1: New York not coincidentally, and in they launched we work

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Speaker 1: with the first site in Soho. So why is this

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Speaker 1: real estate? Sign long term leases and uh sell shorter

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Speaker 1: term leases at a significant markup? How is this not

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Speaker 1: possibly a real estate uh concern? What was what was

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Speaker 1: the argument they were making to people that hey, we're

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Speaker 1: a tech company and we deserve tech company valuations. Sure so, Um,

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Speaker 1: exactly as you said, they had this Brooklyn business that

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Speaker 1: was the genesis of WE Work. It was um It

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Speaker 1: had a lot of that business and it was what

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Speaker 1: they took to make WE Work. It had a lot

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Speaker 1: of innovation to it in terms of architecturally, the aesthetic

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Speaker 1: of it. I mean, we're probably all Mento WE Works.

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Speaker 1: They're just they're beautiful open glass. We had light streaming

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Speaker 1: through the windows. You put you pack people very close together.

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Speaker 1: So something they started in Brooklyn, it took off, but

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Speaker 1: then there the landlord there didn't want to grow it,

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Speaker 1: so they split up. They moved on UM Adam and

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Speaker 1: as part of his co founder Miguel McKelvey, And from

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Speaker 1: the very beginning the idea was something so much bigger

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Speaker 1: they say they created. They like sketched out something and

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Speaker 1: it was like essentially we World. It would be you know,

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Speaker 1: schools and apartments and this whole universe of we But basically,

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Speaker 1: as you said, I mean throughout for the most part,

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Speaker 1: it was this like arbitrage building arbitrage company in terms

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Speaker 1: of getting long term leases and splitting it up all right,

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Speaker 1: So they have a pretty substantial investor list JP Morgan, Chase,

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Speaker 1: t Roe, Prized, Wellington, Goldman, Harvard and Downmond, Benchmark Capital,

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Speaker 1: mort Zuckerman, was this still a rational investment in UM

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Speaker 1: or when did things kind of go off the rails.

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Speaker 1: Um By then, it still seemed like the valuation was

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Speaker 1: really getting ahead of itself, and it was very much

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Speaker 1: predicated on this idea that you said that being a

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Speaker 1: tech company, and I mean Adam Newman's genius was in

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Speaker 1: marketing and fundraising and what he had the ability to

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Speaker 1: do really each step of the way and it's it's

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Speaker 1: masterful was sort of take take the zeitgeist, like the

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Speaker 1: big business idea of the moment that was captivating investors

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Speaker 1: and put that on top of we work. So he

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Speaker 1: was very into a little bit before this, like sort

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Speaker 1: of equating it's a Facebook. You know, Facebook was the

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Speaker 1: social network. This was like a social network in person,

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Speaker 1: in real life social network. And he didn't manage to

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Speaker 1: kind of convince people bit by bit. I mean, it's

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Speaker 1: interesting benchmark, you know, as you know, it is like

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Speaker 1: one of the tip top shelf. Yeah, that's been something

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Speaker 1: had some of the biggest um uber go down the

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Speaker 1: list of just incredible that yeah, eBay, Yeah, they've had

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Speaker 1: it through it for decades. They've been behind some of

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Speaker 1: the biggest companies. So they were willing to take a

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Speaker 1: gamble on them, and then they saw red flags but

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Speaker 1: just decided to jump in anyway. But for benchmark, I

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Speaker 1: mean we've seen they ultimately they get in at such

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Speaker 1: a low valuation, doesn't matter exactly, like you know, they

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Speaker 1: want their home runs, and I mean it's still they

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Speaker 1: still ultimately got out at a pretty good, really incredible

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Speaker 1: return to billions something yeah, something like that. So, so

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Speaker 1: just to clarify, because I I'm going to be trashing

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Speaker 1: we work for the next hour. But this wasn't a

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Speaker 1: Sarah No situation or a Bernie made off. This is

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Speaker 1: not an issue of fraud or anything illegal or unlawful.

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Speaker 1: These just were insane valuations. Somebody did a great job

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Speaker 1: selling investors on the potential for we work and it

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Speaker 1: didn't work out. I'm glad you brought that up because

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Speaker 1: a lot of people do ask about the differences and

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Speaker 1: the parallels between Elizabeth Holmes and Adam Newman, and I

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Speaker 1: mean I almost think the story in some ways is

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Speaker 1: more interesting. I mean, the third of story is obviously

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Speaker 1: the craziest and and horrifying in so many ways. Um,

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Speaker 1: but with Adam Newman on the margins, there are questions

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Speaker 1: about you know, some self dealing and there's some a

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Speaker 1: lot of avarice, and he just cashed out way way early,

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Speaker 1: So you could criticize his behavior, but you know, you

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Speaker 1: end up with the vcs and the outside investors either

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Speaker 1: looking the other way or turning a blind eye. It's

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Speaker 1: not like this stuff wasn't disclosed or anything. He was

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Speaker 1: very out front. No, I need I need a private

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Speaker 1: jet because we're opening up WE works in China and

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Speaker 1: in a hundred other countries and I have to gen

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Speaker 1: around the world. Yeah, maybe you needlf stream is a

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Speaker 1: different question. But you know there they didn't hide this.

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Speaker 1: They were like proud of it. No, and I think

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Speaker 1: it is every step of the way you see. I

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Speaker 1: mean the investors, and these were some of the most

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Speaker 1: sophisticated investors in the world and some of the you know,

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Speaker 1: they're thought of as the smartest investors. They saw the

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Speaker 1: numbers that WE Work was putting forth, and they were real,

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Speaker 1: real numbers. They also saw their projections, and the projections

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Speaker 1: were mythical and they never quite reached them. But you

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Speaker 1: could see if you were going to invest in any

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Speaker 1: round of WE Work, you could see what their prior

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Speaker 1: projections were. How they failed to hit them. But instead

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Speaker 1: the thing that we saw time and time again to

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Speaker 1: this point was very often Adam Newman would meet the

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Speaker 1: head of an investment company, whether it was Men Benchmark

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Speaker 1: or Soft Bank or t ro Price, Like the main

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Speaker 1: decision maker totally captivate this person. You know, it's usually

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Speaker 1: a man. The man would become kind of smitten with

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Speaker 1: Adam and all his ideas and what he was going

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Speaker 1: to do, totally believe in it. The underlings would look

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Speaker 1: at the numbers, raise all these red flags, point them out,

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Speaker 1: and then the decision maker would say, you know, he's amazing.

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Speaker 1: So I want to talk about the rapid rise of

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Speaker 1: we work, and they're they're really fast growth path. But

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Speaker 1: I have to ask what sort of access did you

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Speaker 1: have to the main characters in the book where people forthcoming?

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Speaker 1: I have to imagine there were some people who had

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Speaker 1: grudges and we're happy to speak. What what about um

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Speaker 1: the some of the original founders, Adam and his wife Rebecca,

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Speaker 1: who who did you have access to? Sure? So you know,

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Speaker 1: in the interest of privacy, I can't I can't get

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Speaker 1: into specifics, but what I will say the interesting thing was,

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Speaker 1: I mean, we really got access for hours and hours

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Speaker 1: to the vast majority of players at every step of

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Speaker 1: the way in this book. And um, the one of

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Speaker 1: the funny things was, I mean, the pandemic really started

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Speaker 1: right as Elliott and I took book leave. If we

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Speaker 1: start our book leaving late February, money and we had

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Speaker 1: both planned to sort of be in all around the

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Speaker 1: world meeting people in person. Elliott had moved to New

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Speaker 1: York to meet a lot of the players in person. Obviously,

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Speaker 1: the world shut down, and um, you know, it's kind

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Speaker 1: of nervous about what that would mean in terms of conversations.

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Speaker 1: And the funny thing was, I think people were home

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Speaker 1: board feeling pretty reflective. So there are a number of

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Speaker 1: people that said there, I didn't know if I wanted

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Speaker 1: to talk to you, and some of these people I

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Speaker 1: probably had like ten conversations four hours with And there

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Speaker 1: are forty something pages of in notes. It's I'm not

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Speaker 1: suggesting that this isn't deeply researched, because a lot of

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Speaker 1: these conversations that you report on like you're flying the wall.

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Speaker 1: Clearly it can only be one of two or three people.

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Speaker 1: So it looks like you had a ton of access

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Speaker 1: to a lot of senior people, and I guess we'll

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Speaker 1: just leave it at that. Um So, so let's talk

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Speaker 1: about that early rise. In the beginning, they were really

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Speaker 1: ramping up very rapidly. I mean, you could see how

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Speaker 1: somebody interested in investing in a potential unicorn in fourteen,

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Speaker 1: coming out of the financial crisis. Hey, the idea of

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Speaker 1: all these startups just needing me a little bit of

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Speaker 1: space and not a long term lease. It looks very attractive.

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Speaker 1: It looks like, hey, you could put we works wherever

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Speaker 1: there's a tech community and they should do really well there. Yeah,

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Speaker 1: there was, and it was the marketing was it was

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Speaker 1: very viral at that point. It was you know, people

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Speaker 1: would tell their friends about it and they would fill

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Speaker 1: up very rapidly, and they were building more and more.

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Speaker 1: I mean, and this is one of the you know,

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Speaker 1: as part of the genius of Adam Newman was you know,

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Speaker 1: he was telling people from day one they were really

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Speaker 1: struggling to even secure the lease on the first building,

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Speaker 1: and he was like, Oh, we're gonna be global, We're

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Speaker 1: gonna be international. He would set these goals of how

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Speaker 1: many buildings they would open, and people internally and even

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Speaker 1: investors would say, oh, this is impossible, and he would

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Speaker 1: and he would hit that. He kept on sort of

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Speaker 1: defying gravity, defying disbelief for questions. UM. So the growth

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Speaker 1: was incredible and they were filling them up. We could

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Speaker 1: talk about, you know, the lack of the cost of

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Speaker 1: doing so they were paying double to UM real estate

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Speaker 1: agents what everybody else was paying. They were going to

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Speaker 1: competitors and saying we're going to reach out to your

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Speaker 1: UM tenants and we're gonna offer them free rent for

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Speaker 1: a year. I mean, they were really short elbowed and

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Speaker 1: very aggressive, especially as time went on. We did find

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Speaker 1: that there was one year we we got all their financials.

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Speaker 1: We you know, we got our hands on a vast

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Speaker 1: trope of documents UM. But there was one year I

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Speaker 1: think it was twenty eleven that they I think made

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Speaker 1: two million dollars in profit. Were we were kind of

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Speaker 1: shocked to see that. We didn't think they had ever

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Speaker 1: made a profit. And then from there they did not

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Speaker 1: and the billions and billions just added up in terms

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Speaker 1: of losses. So so the rapid rise we we mentioned UM,

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Speaker 1: they peaked in tw at more than forty seven billion dollars. UH.

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Speaker 1: Newman recently did a interview with your um fellow Times

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Speaker 1: UH correspondent Animi Ross Sorkin, and he was somewhat contrite.

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Speaker 1: He had um admitted that all the venture money and

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Speaker 1: all the high valuations had uh went to his head. Quote,

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Speaker 1: you lose focus on really the core of the business

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Speaker 1: and why the business is meant to be that way,

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Speaker 1: it had a corrosive effect on my thinking. That's kind

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Speaker 1: of a surprising admission from him. It was. Yeah, I

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Speaker 1: mean his mayakalpo is very um interesting, and I mean

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Speaker 1: one of the things that people said along the way was,

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Speaker 1: you know, the the higher the valuation, the more out

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Speaker 1: of touch he became. I mean he had he had

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Speaker 1: a narcissism. I don't know what you want to call it,

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Speaker 1: a sociopathological narcissistic personality disorder. I'm just I'm not a psychologist.

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Speaker 1: I'm just guessing, or a really successful salesman slash CEO.

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Speaker 1: There's like a thin line between the two sometimes it

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Speaker 1: seems and some of it, I mean it seems insane.

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Speaker 1: It was like, oh, he thought of himself in this

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Speaker 1: like same like with along with world leaders. But world

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Speaker 1: leaders were really really wanted to meet him. Yeah, and

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Speaker 1: he was like We have a scene in the book

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Speaker 1: that he was debating whether or not he was going

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Speaker 1: to cancel on Theresa May because he had promised his

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Speaker 1: wife that he would teach a class on entrepreneurship to

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Speaker 1: their new school. Um. So it was like a few

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Speaker 1: of their kids and a few of their kids friends

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Speaker 1: were in the school and they're about five years old,

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Speaker 1: five or six, and he had promised minister five year old.

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Speaker 1: So when you talk about losing touch with reality, some

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Speaker 1: of the m and a that this startup did We've

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Speaker 1: garden A We've machine was like a surf wave machine, meetup,

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Speaker 1: dot com conductor. They ended up dumping these for action

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Speaker 1: what they paid for them. But what's the thought process,

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Speaker 1: We're going to become a technology conglomerate. I don't I

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Speaker 1: don't really follow the thinking other than wouldn't it be

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Speaker 1: fun to have a wave machine at our buildings? Like

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Speaker 1: what's the rationality? Okay? So there were there were two

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Speaker 1: parts to that, and part of it was like it

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Speaker 1: was the world was Adam Newman's playground, and he loved

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Speaker 1: surfing and he thought that, you know, he found out

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Speaker 1: this company, this wave making machine, they would make waves.

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Speaker 1: So him and his team went to Spain to surf

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Speaker 1: on them and test them out. But he could basically

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Speaker 1: convince his board in general, who had to approve the

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Speaker 1: is that anything made sense, whether it was the jet,

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Speaker 1: the wave pool company, or friends of his. I mean

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Speaker 1: Laird Hamilton's, the famous surfer was a friend of his.

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Speaker 1: They invested like in his coffee creamer company. Um. But

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Speaker 1: then the second so it was so many insane investments

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Speaker 1: that really didn't necessarily make any sense. Um. But then

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Speaker 1: on the other side, one of the things that we

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Speaker 1: thought was interesting. He had this deal with Massa. Who Massa,

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Speaker 1: he's the CEO of soft Bank, became we worked biggest investor,

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Speaker 1: biggest enabler, you might say, and one of them. They

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Speaker 1: were going to do this huge deal that would have

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Speaker 1: actually kept we work private forever. It never came to pass,

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Speaker 1: and that's why it was sort of the beginning of

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Speaker 1: the end when this deal fell apart. But as part

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Speaker 1: of it, a lot of the deal is predicated on

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Speaker 1: growing revenue. So Adam also became obsessed with acquisitions, like

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Speaker 1: whatever they could possibly do to add more revenue to

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Speaker 1: the company. I mean, he was talking about buying Sweet Green,

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Speaker 1: and he had like got pretty far along in this

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Speaker 1: salad company and conversations with them. So it was this

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Speaker 1: idea of like, let's just throw on anything. We have money,

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Speaker 1: and let's just grow our top line. Who cares about

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Speaker 1: anything else. Let's talk about Rebecca Newman. She was Adam

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Speaker 1: Newman's wife. What what was her role in we Work?

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Speaker 1: How important was she? Her role is just so fascinating throughout. So,

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Speaker 1: I mean he he met her, um right as he

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Speaker 1: was starting Green Desk, and I think she just sort

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Speaker 1: of opened his eyes. She'd grown up very wealthy, She's

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Speaker 1: Gwyneth Paltrow's cousin. She had all these ties to Hollywood. Um.

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Speaker 1: She gave him a loan early on, UM, a high

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Speaker 1: interest loan. UM. I think even after they were married

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Speaker 1: that we were reported about in the book. UM. But

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Speaker 1: as time went on, she she really wanted a career

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Speaker 1: in Hollywood, decides to At one point she she was

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Speaker 1: trying to be an actress, and she tells someone that

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Speaker 1: she's done with Hollywood. She's producing babies. Now they've gone

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Speaker 1: on to have six kids. UM. But she's sort of

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Speaker 1: always kind of dabbled in the company, and they retroactively

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Speaker 1: made her a co founder. She wasn't there from day one.

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Speaker 1: It was only later she got pretty active. Yeah, she

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Speaker 1: told people aboutn't giving tours early on, that she helped

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Speaker 1: pick out the coffee in the um in the early works.

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Speaker 1: But so she became more active, but she would sort

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Speaker 1: of jump in and out. And it was by the

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Speaker 1: one of the things that she had a big focus on.

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Speaker 1: Their kids were growing up. She didn't really like their

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Speaker 1: choices of private or public schools, so she decided to

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Speaker 1: start She helmed sort of the education initiative. And she

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Speaker 1: was deeply qualified for this because she was a certified

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Speaker 1: yoga instructure and and I know she went to Cornell,

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Speaker 1: which is certainly a good school. What bonifites does she

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Speaker 1: bring to technology, real estate, education, Like I'm trying to

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Speaker 1: figure it out. And in the book you don't really

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Speaker 1: go into any details that she's qualified to do any

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Speaker 1: of these things. I mean, especially with education. It's like

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Speaker 1: she didn't um she wanted to. Essentially, she wanted a

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Speaker 1: school for her children, and she wanted very specific things

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Speaker 1: in that school. And once again they decided that that

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Speaker 1: would be the next Like Frontier for we work, they're

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Speaker 1: always adding different things, but no one really and then

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00:23:04,359 --> 00:23:07,920
Speaker 1: they let them do this. They started this school UM

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Speaker 1: in New York in the headquarters, and they were going

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Speaker 1: to teach the next generation of entrepreneurs. And I mean

399
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Speaker 1: they one of the things, I mean it was the

400
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Speaker 1: education arm more than as much or more than other

401
00:23:19,400 --> 00:23:21,960
Speaker 1: parts of it is just so tragic because they had

402
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Speaker 1: a lot of money. She's she like Adam, could just

403
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Speaker 1: speak like speak so like eloquently and with this vision.

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Speaker 1: So she attracted all these very talented teachers. She sort

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Speaker 1: of wooed them from the schools that they were in

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Speaker 1: before and told them that they were going to start

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Speaker 1: this you know, new enterprise and change education forever. And

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Speaker 1: it just really devolved so quickly. It became very like

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Speaker 1: kind of petty. I mean people say they have PTSD

410
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Speaker 1: from her like obsession with like the rugs, like just

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Speaker 1: monessory type school. And yeah, she obsessed over like the

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Speaker 1: color of white of the rugs and made them like

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Speaker 1: send act twenty rugs. What was the most shocking thing

414
00:24:03,160 --> 00:24:07,040
Speaker 1: you found out about him? Or horror or both? So

415
00:24:07,600 --> 00:24:09,639
Speaker 1: one one of these was. I mean, there was a

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Speaker 1: lot of their personal lives, as we said, whether it

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00:24:14,600 --> 00:24:16,600
Speaker 1: was a school or other things where their kids were

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Speaker 1: educated in UM just the way in which the personal

419
00:24:21,680 --> 00:24:25,640
Speaker 1: entanglements on you know, small and huge levels. But I'll

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Speaker 1: give two examples. I mean, one of the things that

421
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Speaker 1: people said in the school so it's in the we

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Speaker 1: work headquarters, was a whole floor and it's beautiful if

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Speaker 1: you see pictures of it, like just this, like yeah, um.

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Speaker 1: And they had biarchy engles this UM famous architect design

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Speaker 1: the school and UM. But they basically on Friday nights

426
00:24:47,640 --> 00:24:50,960
Speaker 1: would have dinners with their friends there and according to

427
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Speaker 1: many people would cut the team would come in Monday morning.

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Speaker 1: It would be a complete disaster. So it was like

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Speaker 1: really on so many levels, like everything was their personal

430
00:25:02,359 --> 00:25:07,480
Speaker 1: UM so entitled. Yeah. And the second thing that really

431
00:25:07,520 --> 00:25:10,520
Speaker 1: shocked us was she was very she had a lot

432
00:25:10,560 --> 00:25:14,160
Speaker 1: of kind of like phobias around like health and wellness. UM.

433
00:25:14,200 --> 00:25:17,240
Speaker 1: And she says, I mean, she had a real tragedy

434
00:25:17,280 --> 00:25:20,040
Speaker 1: in her family, her brother died from cancer, and so

435
00:25:20,080 --> 00:25:21,879
Speaker 1: she was always she was very focused on it, and

436
00:25:21,920 --> 00:25:24,320
Speaker 1: she said it as much in podcasts and things. But

437
00:25:24,359 --> 00:25:26,600
Speaker 1: she was very fixated on five G you know, and

438
00:25:26,760 --> 00:25:30,520
Speaker 1: she was worried about vaccines for their kids. UM. And

439
00:25:30,720 --> 00:25:33,159
Speaker 1: but the five G of like what that could do

440
00:25:33,680 --> 00:25:36,080
Speaker 1: for you know, these signals. She wouldn't let them have

441
00:25:36,160 --> 00:25:39,320
Speaker 1: printers on the floor, like any printers on wireless printers

442
00:25:39,320 --> 00:25:41,399
Speaker 1: on the floor of the school. But there was a

443
00:25:41,520 --> 00:25:44,960
Speaker 1: they bought this. Can you even buy five G printers today? What?

444
00:25:44,960 --> 00:25:49,000
Speaker 1: What was the Yeah, the wireless like freaked her out.

445
00:25:49,000 --> 00:25:50,600
Speaker 1: So the teachers that have to like run up and

446
00:25:50,600 --> 00:25:53,959
Speaker 1: downstairs to just print everything, it seemed ridiculous. But the

447
00:25:54,000 --> 00:25:58,199
Speaker 1: five G towers, there was one either being built or

448
00:25:58,200 --> 00:26:02,480
Speaker 1: built right near there being c par Park, Yeah, right nearby.

449
00:26:02,840 --> 00:26:04,840
Speaker 1: So she was so obsessed with that she didn't want

450
00:26:04,840 --> 00:26:07,840
Speaker 1: to move in there. They had bought like six apartments

451
00:26:07,840 --> 00:26:12,000
Speaker 1: in this building that she um the CFO this is

452
00:26:12,040 --> 00:26:13,879
Speaker 1: around the time they're preparing for the I p O

453
00:26:14,040 --> 00:26:15,680
Speaker 1: used to work at Time Owner Cable. He was the

454
00:26:15,720 --> 00:26:19,359
Speaker 1: CFO of Time Owner Cable. So she said, can you

455
00:26:19,560 --> 00:26:23,800
Speaker 1: already mention help us get rid of the five G tower?

456
00:26:24,560 --> 00:26:31,919
Speaker 1: Um and haven't moved And basically he deputized another aide

457
00:26:32,000 --> 00:26:34,520
Speaker 1: who used to work for Cuomo and work for Governor

458
00:26:34,600 --> 00:26:39,439
Speaker 1: Christie the form both former governors, and they like that

459
00:26:39,520 --> 00:26:43,440
Speaker 1: was something that they actually worked on. So that, yeah,

460
00:26:43,640 --> 00:26:46,800
Speaker 1: that interplay was just kind of seems rational that there

461
00:26:46,880 --> 00:26:50,119
Speaker 1: was a Vanity Fair article how Rebecca Newman put the

462
00:26:50,119 --> 00:26:54,160
Speaker 1: woo woo and We Work, And what you're describing very

463
00:26:54,240 --> 00:26:58,320
Speaker 1: much is along the lines of that. I've seen Newman

464
00:26:58,640 --> 00:27:01,320
Speaker 1: described as a vision area, as a crack pot, as

465
00:27:01,440 --> 00:27:05,160
Speaker 1: as a grifter. But he thinks he's going to become

466
00:27:05,160 --> 00:27:09,159
Speaker 1: the world's first trillionaire, and and we worked the first

467
00:27:09,200 --> 00:27:14,800
Speaker 1: ten trillion dollar company. Is any realistic scenario where that

468
00:27:14,840 --> 00:27:19,000
Speaker 1: happens or is he just completely delusional? I mean, it

469
00:27:19,160 --> 00:27:23,960
Speaker 1: seems insane and like he seems completely delusional. But he

470
00:27:24,040 --> 00:27:27,240
Speaker 1: had a lot of people going along with him, including

471
00:27:27,359 --> 00:27:30,560
Speaker 1: um the man with one of the biggest checkbooks in

472
00:27:30,600 --> 00:27:34,399
Speaker 1: the world, who is Massa Yochi Sone, the CEO and

473
00:27:34,440 --> 00:27:38,760
Speaker 1: founder of soft Bank, who had just the timing of

474
00:27:38,800 --> 00:27:41,639
Speaker 1: this story. It's like, there's so many things that happened

475
00:27:41,760 --> 00:27:45,000
Speaker 1: at the Shudi Arabia wanting to diversify, giving a ton

476
00:27:45,040 --> 00:27:48,560
Speaker 1: of money, you you call son the enabler in chief.

477
00:27:48,640 --> 00:27:52,920
Speaker 1: He put more than ten billion dollars of capital showered

478
00:27:52,960 --> 00:27:56,160
Speaker 1: on onto We Work. How much do you blame soon

479
00:27:56,520 --> 00:27:59,960
Speaker 1: for all of this mayhem? At least in the last

480
00:28:00,359 --> 00:28:03,359
Speaker 1: a couple of years of We Works. Um run as

481
00:28:03,400 --> 00:28:07,639
Speaker 1: a private company. It seems like he was the main, uh,

482
00:28:07,800 --> 00:28:11,160
Speaker 1: you know, the main person kind of pushing all of this.

483
00:28:11,280 --> 00:28:14,280
Speaker 1: And when you talk to a lot of people around Adam,

484
00:28:14,320 --> 00:28:17,400
Speaker 1: they just said they were just such a a dicey

485
00:28:17,520 --> 00:28:22,600
Speaker 1: match like that. Adam was crazy to begin with. Everyone

486
00:28:22,640 --> 00:28:25,359
Speaker 1: thought that, you know, it can go both ways, but

487
00:28:25,840 --> 00:28:28,840
Speaker 1: people drank the kool aid. It reminded me. You don't

488
00:28:28,880 --> 00:28:32,040
Speaker 1: mention Steve Jobs in the book, but very much the

489
00:28:32,119 --> 00:28:36,680
Speaker 1: reality distortion field that Jobs was famous for. I very

490
00:28:36,720 --> 00:28:39,880
Speaker 1: much got the sense Newman was creating something like that.

491
00:28:40,320 --> 00:28:42,320
Speaker 1: How did he get everybody to drink the kool aid?

492
00:28:42,360 --> 00:28:45,320
Speaker 1: Was he just that charismatic and that good of a salesman?

493
00:28:45,680 --> 00:28:48,560
Speaker 1: I think so. And it was just he could talk

494
00:28:48,640 --> 00:28:51,680
Speaker 1: about things and make you feel like the reality was there,

495
00:28:51,800 --> 00:28:55,720
Speaker 1: this reality distortion field he was. He was masterful in that.

496
00:28:56,160 --> 00:28:59,920
Speaker 1: Yet the thing that he did was he always found

497
00:29:00,040 --> 00:29:03,040
Speaker 1: new pots of money all over the world. I mean,

498
00:29:03,080 --> 00:29:04,640
Speaker 1: it was the time. It was the time when the

499
00:29:04,680 --> 00:29:07,480
Speaker 1: private capital markets were getting deeper and deeper. The fidelities

500
00:29:07,520 --> 00:29:10,000
Speaker 1: in the t row that like normally kind of sober

501
00:29:10,160 --> 00:29:14,520
Speaker 1: mutual funds were jumping into startups and they were we

502
00:29:14,640 --> 00:29:17,959
Speaker 1: call one of the chapters fomo is like the fun Fomo.

503
00:29:18,000 --> 00:29:20,920
Speaker 1: They were fearful of missing out in the next big thing,

504
00:29:21,600 --> 00:29:23,680
Speaker 1: so that we're sort of in this climate where there

505
00:29:23,720 --> 00:29:25,880
Speaker 1: is an appetite to go after to just take a

506
00:29:26,000 --> 00:29:29,560
Speaker 1: chance for the chance of getting the next like maybe

507
00:29:29,560 --> 00:29:31,760
Speaker 1: not trillion dollar company, maybe no one but him and

508
00:29:31,800 --> 00:29:36,680
Speaker 1: mass I believe that, UM, but right the next early.

509
00:29:37,120 --> 00:29:40,040
Speaker 1: You know, it's always interesting when you see these uh

510
00:29:40,400 --> 00:29:45,360
Speaker 1: staid old mutual fund companies that have literally no experience

511
00:29:45,360 --> 00:29:50,200
Speaker 1: in venture capital or uh tech startups, but happy to

512
00:29:50,240 --> 00:29:53,040
Speaker 1: plow into it because they want to be part of it.

513
00:29:53,520 --> 00:29:58,040
Speaker 1: And maybe that's how we end up with community adjusted ibadac.

514
00:29:58,120 --> 00:30:02,480
Speaker 1: Can can you explain to us what that phrase means?

515
00:30:02,520 --> 00:30:04,440
Speaker 1: I don't even know what else to call it. Sure,

516
00:30:05,120 --> 00:30:08,400
Speaker 1: so we work was losing every every step of the way.

517
00:30:08,440 --> 00:30:11,360
Speaker 1: They were growing revenue more than doubling it. You know,

518
00:30:11,400 --> 00:30:14,440
Speaker 1: they were expanding all around the world, and with that

519
00:30:14,480 --> 00:30:17,960
Speaker 1: they were losing just as much, if not more, every

520
00:30:17,960 --> 00:30:20,920
Speaker 1: single year, and then they were taking in. So they

521
00:30:20,920 --> 00:30:24,320
Speaker 1: had this brilliant idea really a lot stemming from the

522
00:30:24,360 --> 00:30:29,440
Speaker 1: CFO and Adam Newman loved to CFOs creation um his

523
00:30:29,560 --> 00:30:31,920
Speaker 1: name is Artay Minson, the CFO, and it was this

524
00:30:32,000 --> 00:30:35,680
Speaker 1: idea that you essentially strip out a lot of the

525
00:30:35,720 --> 00:30:39,440
Speaker 1: costs of kind of creating all the building out all

526
00:30:39,440 --> 00:30:43,719
Speaker 1: the wee works and you know, marketing and opening up

527
00:30:43,720 --> 00:30:46,400
Speaker 1: new buildings. You strip it out and then you're suddenly

528
00:30:46,400 --> 00:30:49,000
Speaker 1: a profitable Company's let me, let me make sure I

529
00:30:49,080 --> 00:30:53,640
Speaker 1: understand this. So if you eliminate the costs of generating

530
00:30:53,680 --> 00:30:58,000
Speaker 1: that profit, you suddenly become profitable. Have come nobody else

531
00:30:58,000 --> 00:31:01,600
Speaker 1: thought of this sooner? It seems like a da just

532
00:31:02,000 --> 00:31:08,800
Speaker 1: don't it's profits ex expenses. It's fantastic. And the conviction

533
00:31:08,880 --> 00:31:12,080
Speaker 1: with which certain people inside, especially in the finance team,

534
00:31:12,520 --> 00:31:15,120
Speaker 1: believe this, I mean they were saying throughout that like, oh,

535
00:31:15,160 --> 00:31:17,280
Speaker 1: we will be a profitable company if we just The

536
00:31:17,320 --> 00:31:19,880
Speaker 1: idea was if we just stopped growing, we could be

537
00:31:19,920 --> 00:31:23,480
Speaker 1: profitable right now we take in more per building than

538
00:31:23,600 --> 00:31:27,440
Speaker 1: we um spend on it. But um, you know that

539
00:31:27,840 --> 00:31:31,880
Speaker 1: never was the case. So let's stick with the delusion concept.

540
00:31:32,280 --> 00:31:35,239
Speaker 1: We talked about we grow, and we talked about we

541
00:31:35,320 --> 00:31:38,800
Speaker 1: live a little bit crazy stuff. What made this guy

542
00:31:38,920 --> 00:31:43,840
Speaker 1: think he can help colonize Mars? You laugh, You wrote

543
00:31:43,920 --> 00:31:47,560
Speaker 1: it yourself and it's still funny. By the way, I

544
00:31:47,560 --> 00:31:51,240
Speaker 1: found a lot of the book very amusing, like very dry,

545
00:31:51,280 --> 00:31:55,200
Speaker 1: Like you guys didn't try and crack jokes, but clearly

546
00:31:55,240 --> 00:31:58,120
Speaker 1: a lot of the stuff was just so insane. You

547
00:31:58,200 --> 00:32:00,680
Speaker 1: read it, you start to laugh out loud. I'm glad.

548
00:32:01,040 --> 00:32:03,360
Speaker 1: I'm glad to hear that, because I think we would

549
00:32:03,440 --> 00:32:05,920
Speaker 1: joke that, like every day when we were in different

550
00:32:05,920 --> 00:32:09,200
Speaker 1: places writing it. We're on calls constantly, and we would

551
00:32:09,200 --> 00:32:12,360
Speaker 1: call each other, and it was often multiple times a day.

552
00:32:12,400 --> 00:32:14,640
Speaker 1: We would call each other and say, you will never

553
00:32:14,800 --> 00:32:18,160
Speaker 1: ever believe what I just heard, and we would crack up,

554
00:32:18,200 --> 00:32:20,040
Speaker 1: and we had a lot of fun writing it because

555
00:32:20,080 --> 00:32:23,560
Speaker 1: it's just it was the truth of this story was

556
00:32:23,640 --> 00:32:26,560
Speaker 1: like more insane than anything we could have made up. Ever,

557
00:32:26,960 --> 00:32:29,840
Speaker 1: that's the joke that, you know, the difference between truth

558
00:32:29,880 --> 00:32:33,200
Speaker 1: and fiction is fiction has to make sense and truth

559
00:32:33,480 --> 00:32:36,880
Speaker 1: is under no such obligation. So let's talk about Newman

560
00:32:36,920 --> 00:32:39,920
Speaker 1: colonize at moll. I mean, was that a serious thing

561
00:32:40,040 --> 00:32:42,960
Speaker 1: or was he just you know, on one of his

562
00:32:43,520 --> 00:32:47,960
Speaker 1: insane John's and everybody comes along, they're they're speaking of

563
00:32:48,080 --> 00:32:52,800
Speaker 1: fine lines. I mean, he just I think he believed

564
00:32:52,880 --> 00:32:57,440
Speaker 1: he started to believe more and more of like these delusions.

565
00:32:57,520 --> 00:32:59,920
Speaker 1: And so I think he really did, and yeah he got.

566
00:33:00,200 --> 00:33:04,000
Speaker 1: He secured a meeting with Elon Musk, and he Elon

567
00:33:04,120 --> 00:33:06,960
Speaker 1: Musk he was always Adam was always late to every meeting,

568
00:33:06,960 --> 00:33:09,520
Speaker 1: would make people wait for hours, like even like the

569
00:33:09,560 --> 00:33:11,640
Speaker 1: bankers in the I p O would just sit around.

570
00:33:11,640 --> 00:33:14,600
Speaker 1: There'll be rooms of like dozens of people waiting for

571
00:33:14,640 --> 00:33:16,960
Speaker 1: Adam and he'd show up like two hours late. But

572
00:33:17,080 --> 00:33:20,880
Speaker 1: Elon Musk made him wait for this meeting. They sat

573
00:33:20,960 --> 00:33:25,280
Speaker 1: and sat and sat, and then he told Elon Musk

574
00:33:25,400 --> 00:33:29,600
Speaker 1: that getting that he thought, like building community on Mars

575
00:33:29,720 --> 00:33:32,160
Speaker 1: is what he would do and he would help him

576
00:33:32,320 --> 00:33:34,880
Speaker 1: with And he said, you know, getting getting to Mars

577
00:33:35,000 --> 00:33:37,320
Speaker 1: is the easy part. Building community is the hard part,

578
00:33:38,040 --> 00:33:39,920
Speaker 1: because you know, it's very hard to get those beer

579
00:33:39,960 --> 00:33:43,800
Speaker 1: taps to work in a low gravity, zero atmosphere environment.

580
00:33:43,800 --> 00:33:49,480
Speaker 1: It's a challenge. Only we work could accomplish the fruit Honor. So,

581
00:33:49,480 --> 00:33:51,800
Speaker 1: so I want to talk about the I p OH.

582
00:33:51,840 --> 00:33:54,600
Speaker 1: But before I get to that, I have to ask

583
00:33:55,440 --> 00:34:00,320
Speaker 1: about the corporate off sites. The summer camp would were

584
00:34:00,480 --> 00:34:06,080
Speaker 1: described as three day global subjects of drinking and drug consumption.

585
00:34:06,440 --> 00:34:09,680
Speaker 1: It was like a Woodstock event, not like a corporate retreat.

586
00:34:10,040 --> 00:34:13,560
Speaker 1: How did these come about? So Adam would say that

587
00:34:13,600 --> 00:34:16,279
Speaker 1: he never he grew up in Israel and he moved

588
00:34:16,320 --> 00:34:18,360
Speaker 1: to the US. He lived for a little while in

589
00:34:18,360 --> 00:34:21,000
Speaker 1: the US, but moved later in life. Um, so he

590
00:34:21,040 --> 00:34:23,200
Speaker 1: said he never got to go to American summer camp.

591
00:34:23,360 --> 00:34:26,239
Speaker 1: So he was going to recreate summer American summer camp.

592
00:34:26,320 --> 00:34:31,080
Speaker 1: Literally they started at um his wife's families. Um had

593
00:34:31,120 --> 00:34:33,480
Speaker 1: a summer camp and upstate New York that's where they started.

594
00:34:33,880 --> 00:34:38,000
Speaker 1: They just got bigger and bigger, eventually going to England

595
00:34:38,520 --> 00:34:42,600
Speaker 1: and taking over this like huge like field, this hugest

596
00:34:42,640 --> 00:34:46,400
Speaker 1: state there and bringing every single member of the company,

597
00:34:46,440 --> 00:34:48,920
Speaker 1: flying them from all and there were thousands of employees,

598
00:34:49,080 --> 00:34:53,920
Speaker 1: thousands upon thousands, and the cost was unbelievable of every

599
00:34:53,920 --> 00:34:56,520
Speaker 1: piece of it. I mean every year they just got

600
00:34:56,520 --> 00:34:58,719
Speaker 1: bigger and bigger, and they flew at the height of

601
00:34:58,800 --> 00:35:00,680
Speaker 1: his fame, not that he's far off of it, but

602
00:35:00,880 --> 00:35:03,759
Speaker 1: Lin Manuel Miranda, like at the height of Hamilton's they

603
00:35:03,760 --> 00:35:07,440
Speaker 1: flew him on a private jet. He he performed on stage,

604
00:35:07,640 --> 00:35:10,839
Speaker 1: the roots came and they would pay these people like

605
00:35:11,040 --> 00:35:17,319
Speaker 1: million dollars. Yeah, that's afternoon. Yeah, exactly. Um, and they

606
00:35:17,360 --> 00:35:20,880
Speaker 1: were um, you know, especially at the beginning. It was

607
00:35:20,960 --> 00:35:26,280
Speaker 1: like a younger um group of people. Uh, in general,

608
00:35:26,400 --> 00:35:28,920
Speaker 1: and I mean these these were crazy. There's tons of

609
00:35:28,960 --> 00:35:32,480
Speaker 1: alcohol sanctioned by the company, handed out by the company.

610
00:35:32,719 --> 00:35:36,080
Speaker 1: Drugs were in you know, in supply, not handed out

611
00:35:36,080 --> 00:35:38,759
Speaker 1: at the company, but they were everywhere. And he talks

612
00:35:38,800 --> 00:35:42,240
Speaker 1: about um drugs. He says, well, we just not really drugged,

613
00:35:43,400 --> 00:35:46,279
Speaker 1: you know he um. So yeah, I think it got

614
00:35:46,320 --> 00:35:48,920
Speaker 1: to a point. And it was also mandatory to come

615
00:35:50,040 --> 00:35:52,920
Speaker 1: to these events. I mean, and there were like meetings

616
00:35:52,960 --> 00:35:55,680
Speaker 1: where there are shots. Everybody has to do shots. This

617
00:35:55,840 --> 00:36:01,560
Speaker 1: wasn't just at these retreats. Like hard partying was pretty

618
00:36:01,640 --> 00:36:05,520
Speaker 1: common throughout the company or anywhere Newman seemed to have

619
00:36:06,600 --> 00:36:09,640
Speaker 1: touched when when he was there, everybody was expected to

620
00:36:09,800 --> 00:36:13,279
Speaker 1: step up and and party hard, including the investors. I mean,

621
00:36:13,280 --> 00:36:16,000
Speaker 1: you'd walk into his office at ten am, according to

622
00:36:16,160 --> 00:36:19,320
Speaker 1: so many different people, and he'd insist on taking to

623
00:36:19,480 --> 00:36:23,160
Speaker 1: kill a shots with you in the morning in his office.

624
00:36:23,719 --> 00:36:26,200
Speaker 1: And you didn't have a shot before this, You don't,

625
00:36:26,880 --> 00:36:30,960
Speaker 1: isn't That isn't how every meeting begins. Breast the breakfast

626
00:36:30,960 --> 00:36:35,280
Speaker 1: of champions, That's right, so so I got the sense

627
00:36:35,320 --> 00:36:38,719
Speaker 1: from the book that they always seem to be on

628
00:36:38,800 --> 00:36:41,600
Speaker 1: the edge of running out of money, and they would

629
00:36:41,600 --> 00:36:45,680
Speaker 1: always find another source. But it was all leading towards

630
00:36:45,760 --> 00:36:49,560
Speaker 1: the I p O. But the S one filing, the

631
00:36:49,640 --> 00:36:52,640
Speaker 1: disclosures that go with an I p O filing, that

632
00:36:52,800 --> 00:36:58,600
Speaker 1: seemed to be the they're undoing the public just investing

633
00:36:58,640 --> 00:37:02,360
Speaker 1: public just tore it apart exactly. I mean. The interesting

634
00:37:02,360 --> 00:37:04,680
Speaker 1: piece of that, as you said, it was there's always

635
00:37:04,680 --> 00:37:08,000
Speaker 1: a new pool of capital. Like just when he thought

636
00:37:08,080 --> 00:37:09,680
Speaker 1: that he was gonna have to go public and the

637
00:37:09,760 --> 00:37:12,040
Speaker 1: board and the board, I mean, one of the things

638
00:37:12,040 --> 00:37:14,560
Speaker 1: we found time and time again was the board would say,

639
00:37:15,040 --> 00:37:17,680
Speaker 1: you know, he's really like crazy, things are getting out

640
00:37:17,680 --> 00:37:20,760
Speaker 1: of hand, but like we won't say no to him,

641
00:37:20,800 --> 00:37:22,719
Speaker 1: but eventually he's going to have to go public. This

642
00:37:22,760 --> 00:37:25,640
Speaker 1: was back in they thought he was going to run

643
00:37:25,680 --> 00:37:27,799
Speaker 1: out of money. The only place to go because they're

644
00:37:27,840 --> 00:37:31,279
Speaker 1: burning so much cash, um was the public markets, and

645
00:37:31,280 --> 00:37:33,560
Speaker 1: the public markets will take care of it, which kind

646
00:37:33,560 --> 00:37:35,799
Speaker 1: of that kind of floored us each step of the way.

647
00:37:35,840 --> 00:37:38,640
Speaker 1: But yes, as you said, he he knew how to

648
00:37:38,719 --> 00:37:42,520
Speaker 1: captivate on in one on one or bigger meetings to

649
00:37:42,680 --> 00:37:45,040
Speaker 1: convince you of this future, to tell you. We always

650
00:37:45,080 --> 00:37:46,840
Speaker 1: describe him kind of as a magician and think of

651
00:37:46,920 --> 00:37:49,520
Speaker 1: him like this, like don't look here, look here, like

652
00:37:49,560 --> 00:37:52,239
Speaker 1: the slight of hand he could. Then this S one

653
00:37:52,280 --> 00:37:54,160
Speaker 1: came out. It was a regulatory document. You have to

654
00:37:54,200 --> 00:37:57,960
Speaker 1: follow rules. There's no slight of hand in S one filing. No,

655
00:37:58,160 --> 00:38:00,399
Speaker 1: like you have to see and people suddenly he saw

656
00:38:00,719 --> 00:38:07,960
Speaker 1: the broad public, the revenue, the losses a lot, not

657
00:38:08,080 --> 00:38:12,440
Speaker 1: even all of these, um you know, the questionable corporate governance,

658
00:38:12,440 --> 00:38:15,640
Speaker 1: I mean that self dealing, self dealing. Only pieces of

659
00:38:15,680 --> 00:38:18,080
Speaker 1: that were even in it. Because the jet wasn't in

660
00:38:18,080 --> 00:38:20,719
Speaker 1: the S one, they didn't have to disclose it then.

661
00:38:20,800 --> 00:38:23,120
Speaker 1: And the interesting thing about this, I think there's always

662
00:38:23,160 --> 00:38:25,560
Speaker 1: like this distinction that people try to make between like, oh,

663
00:38:25,640 --> 00:38:28,960
Speaker 1: the smart money and the dumb money, and it's like

664
00:38:29,000 --> 00:38:31,279
Speaker 1: the smart money is like the fidelities and the t

665
00:38:31,520 --> 00:38:34,480
Speaker 1: rose and the soft banks, and then the dumb money,

666
00:38:34,560 --> 00:38:37,640
Speaker 1: you know, it's like the you know, the average retail investor.

667
00:38:38,440 --> 00:38:40,799
Speaker 1: And so it's just so interesting that like he he

668
00:38:41,000 --> 00:38:44,480
Speaker 1: captivated the the quote unquote smart money, and then the

669
00:38:44,560 --> 00:38:48,120
Speaker 1: minute this was all made public, everything was there. The

670
00:38:48,160 --> 00:38:52,000
Speaker 1: world saw it and just said like what is wrong,

671
00:38:52,040 --> 00:38:54,480
Speaker 1: Like this is insane. I'm nursing a pet theory that

672
00:38:54,560 --> 00:38:58,120
Speaker 1: it was Twitter that demolished him because people just had

673
00:38:58,160 --> 00:39:01,840
Speaker 1: a fee. I remember the day of this filing, Twitter

674
00:39:01,960 --> 00:39:06,360
Speaker 1: just blew up with like a million people are taking

675
00:39:06,400 --> 00:39:09,399
Speaker 1: an s one apart, sentenced by sentence, and the most

676
00:39:09,400 --> 00:39:12,279
Speaker 1: outrageous things bubbled up to the top of Twitter, and

677
00:39:12,320 --> 00:39:16,240
Speaker 1: it was very clear that they were dead in the water.

678
00:39:16,360 --> 00:39:18,520
Speaker 1: There was going to be no I p O and

679
00:39:18,880 --> 00:39:23,040
Speaker 1: the dreams of these crazy valuations seemed to crash and

680
00:39:23,080 --> 00:39:26,239
Speaker 1: burn with the the I p O filing, which which

681
00:39:26,320 --> 00:39:30,080
Speaker 1: kind of raises the question about you know, how was

682
00:39:30,200 --> 00:39:35,000
Speaker 1: all of this corporate governance so amiss? All the self

683
00:39:35,239 --> 00:39:38,799
Speaker 1: dealings that were allowed. So my my favorite one was

684
00:39:39,440 --> 00:39:43,880
Speaker 1: he personally trademarked the word we and then charged the

685
00:39:43,920 --> 00:39:48,800
Speaker 1: company six million dollars to use it again. He's given

686
00:39:48,880 --> 00:39:53,680
Speaker 1: these sort of crazy disclosure explanations and I'm only allowed

687
00:39:53,719 --> 00:39:56,680
Speaker 1: to say this, but it seems he bought a bunch

688
00:39:56,680 --> 00:39:59,799
Speaker 1: of buildings in order to flip them too. We work

689
00:40:00,000 --> 00:40:03,080
Speaker 1: had a profit. I don't understand how the board we

690
00:40:03,120 --> 00:40:06,480
Speaker 1: mentioned para nos, here's the parallel. How did the board

691
00:40:06,520 --> 00:40:12,560
Speaker 1: tolerate just the most egregious averaice, lack of interest in

692
00:40:12,560 --> 00:40:16,279
Speaker 1: the company and only enrichment of oneself. How does the

693
00:40:16,320 --> 00:40:19,000
Speaker 1: board of directors tolerate that? I know that was I

694
00:40:19,040 --> 00:40:21,880
Speaker 1: think if anything from this whole story that just floored

695
00:40:21,960 --> 00:40:24,080
Speaker 1: us was exactly that this board. I mean, it was

696
00:40:24,120 --> 00:40:27,200
Speaker 1: a it was a real, like heavy hitting board of directors.

697
00:40:27,200 --> 00:40:30,840
Speaker 1: They're not and all financial people as opposed to thereinos,

698
00:40:30,920 --> 00:40:33,279
Speaker 1: you know, it was like people who didn't really politics

699
00:40:33,320 --> 00:40:37,360
Speaker 1: and generals and secretaries of states, right, it was, and

700
00:40:37,400 --> 00:40:40,239
Speaker 1: a lot of elderly men who were smitten with her,

701
00:40:40,480 --> 00:40:42,640
Speaker 1: I mean like men in what was Kissinger on the board?

702
00:40:42,640 --> 00:40:46,040
Speaker 1: He was nineties something. So so with this though, the

703
00:40:46,080 --> 00:40:50,080
Speaker 1: other thing that's shocking is, you know, most founders of

704
00:40:50,120 --> 00:40:54,640
Speaker 1: a successful company, they live a reasonably comfortable lifestyle. But

705
00:40:54,840 --> 00:40:58,040
Speaker 1: the thought processes, hey, one day we'll go public and

706
00:40:58,160 --> 00:41:00,120
Speaker 1: my gravy train will come in and I'll have of

707
00:41:00,400 --> 00:41:04,440
Speaker 1: a high you know, eight nine figure net worth. Early

708
00:41:04,680 --> 00:41:10,960
Speaker 1: in this timeline, he was paying himself, um, cashing out

709
00:41:11,000 --> 00:41:14,319
Speaker 1: stock worth tens of millions, in some cases hundreds of

710
00:41:14,360 --> 00:41:18,520
Speaker 1: millions of dollars. Way way, early in the company was

711
00:41:18,600 --> 00:41:20,799
Speaker 1: five years old and he was worth a couple of

712
00:41:20,840 --> 00:41:24,400
Speaker 1: hundred million liquid and god knows how much on paper. Again,

713
00:41:24,520 --> 00:41:28,279
Speaker 1: how how does a board allow that to take place? Yeah,

714
00:41:28,320 --> 00:41:32,239
Speaker 1: that was what a board. Investors kind of signing off

715
00:41:32,280 --> 00:41:34,400
Speaker 1: on this or jumping into it, I mean seeing that

716
00:41:34,440 --> 00:41:36,400
Speaker 1: he's going to sell a lot of stock each round.

717
00:41:36,960 --> 00:41:39,400
Speaker 1: I mean, now there does seem to be a shift,

718
00:41:39,600 --> 00:41:41,319
Speaker 1: and it's kind of a scary one that this is

719
00:41:41,360 --> 00:41:44,879
Speaker 1: like more private company as the founders are selling more

720
00:41:44,920 --> 00:41:48,359
Speaker 1: and more. But back then you didn't really see this

721
00:41:48,520 --> 00:41:50,520
Speaker 1: very much. And one of the things I find very

722
00:41:50,560 --> 00:41:54,160
Speaker 1: interesting is he was very much following that Travis Kalenik,

723
00:41:54,239 --> 00:41:58,080
Speaker 1: that uber CEOs playbook and literally like following it that

724
00:41:58,200 --> 00:42:01,200
Speaker 1: like going after the same invest is going around the world.

725
00:42:01,719 --> 00:42:05,120
Speaker 1: Travis had raised more money than anyone before Travis every

726
00:42:05,120 --> 00:42:07,440
Speaker 1: step of the way made a huge point of um

727
00:42:07,480 --> 00:42:10,279
Speaker 1: all in I'm never selling any stock until he was

728
00:42:10,360 --> 00:42:14,000
Speaker 1: kicked out of the company basically, so Adam followed his playbook,

729
00:42:14,239 --> 00:42:17,160
Speaker 1: but each step of the way was said he took

730
00:42:17,200 --> 00:42:19,160
Speaker 1: money out and was like, I mean, he was very

731
00:42:19,239 --> 00:42:24,080
Speaker 1: wealthy for a scrappy startup founder fourteen fifteen sixteen, You

732
00:42:24,080 --> 00:42:27,120
Speaker 1: would think, hey, he's maybe he's making a decent living,

733
00:42:27,200 --> 00:42:29,719
Speaker 1: but not hundreds of millions of dollars. It's kind of

734
00:42:29,760 --> 00:42:34,319
Speaker 1: amazing or like having many, many many houses. They were like,

735
00:42:34,600 --> 00:42:37,640
Speaker 1: he didn't hide, um, the way in which he was living.

736
00:42:37,719 --> 00:42:39,880
Speaker 1: How's it having houses all over the world, jet setting

737
00:42:39,920 --> 00:42:42,960
Speaker 1: all over the world. Um, you know, And in fact,

738
00:42:43,040 --> 00:42:45,680
Speaker 1: he almost like you know, wanted everyone to know. That

739
00:42:45,719 --> 00:42:49,920
Speaker 1: was part of his like allure. So when the I

740
00:42:50,080 --> 00:42:54,879
Speaker 1: p O filing in twenty nineteen, when when that blows up,

741
00:42:55,239 --> 00:42:58,040
Speaker 1: it seems to have a real impact on Silicon Valley

742
00:42:58,120 --> 00:43:03,680
Speaker 1: for a while. Suddenly um high spending, fast growing, profitless

743
00:43:03,680 --> 00:43:06,879
Speaker 1: companies look bad and now we're back to we want

744
00:43:06,920 --> 00:43:10,200
Speaker 1: profit growth and revenue. But that really didn't last all

745
00:43:10,239 --> 00:43:13,160
Speaker 1: that long, did it? No? It was unbelievable. I mean

746
00:43:13,719 --> 00:43:16,400
Speaker 1: we also, Elliott and I joke that we rewrote the

747
00:43:16,440 --> 00:43:20,040
Speaker 1: epilogue like five times because at first we wrote it

748
00:43:20,080 --> 00:43:24,440
Speaker 1: saying like yeah, and it was I mean Massa. Yoshi

749
00:43:24,480 --> 00:43:26,800
Speaker 1: soon had his own maya culpa, like, you know, I

750
00:43:26,880 --> 00:43:30,160
Speaker 1: believed an atom I shouldn't have. I made mistakes, but

751
00:43:30,320 --> 00:43:32,960
Speaker 1: also I want my companies to be profitable now, like

752
00:43:33,000 --> 00:43:35,080
Speaker 1: I'm gonna invest in these companies or the companies have

753
00:43:35,120 --> 00:43:39,000
Speaker 1: invested already should be profitable. Um I p O investors,

754
00:43:39,000 --> 00:43:42,440
Speaker 1: public market investors were totally spooked by money losing companies.

755
00:43:43,080 --> 00:43:46,359
Speaker 1: Then um, you know, then came the pandemic. Then came

756
00:43:46,360 --> 00:43:49,880
Speaker 1: the FED pumping money into the system, and then um

757
00:43:49,920 --> 00:43:52,440
Speaker 1: you know. Now in some ways it's like, wow, we

758
00:43:52,480 --> 00:43:57,319
Speaker 1: work at least like may generated revenue and losses. It's

759
00:43:57,360 --> 00:44:03,120
Speaker 1: like now today we have riving and lucid, and you know,

760
00:44:03,520 --> 00:44:07,360
Speaker 1: it's all potential. Maybe it works out. Maybe Amazon buys

761
00:44:07,400 --> 00:44:10,680
Speaker 1: a hundred thousand trucks from them, but that's kind of

762
00:44:11,000 --> 00:44:14,120
Speaker 1: that's a possibility. And you know, more more than just

763
00:44:14,200 --> 00:44:16,520
Speaker 1: the FED, you had the carezac. You had a ton

764
00:44:16,520 --> 00:44:20,680
Speaker 1: of money flow into the system, but it doesn't necessarily

765
00:44:20,719 --> 00:44:25,319
Speaker 1: flow to venture funded outfits. It's just a lot of

766
00:44:25,360 --> 00:44:29,040
Speaker 1: cash slashing around. Is that is that a fair statement? Completely? So,

767
00:44:29,360 --> 00:44:34,280
Speaker 1: how quickly were the lessons of we work forgotten? Incredibly quickly?

768
00:44:34,280 --> 00:44:36,239
Speaker 1: I mean it felt like it had It felt like

769
00:44:36,239 --> 00:44:38,759
Speaker 1: it changed everything for a few months. I mean. The

770
00:44:38,760 --> 00:44:43,279
Speaker 1: other part of it was Mason had had raised a

771
00:44:43,360 --> 00:44:46,200
Speaker 1: hundred billion dollar fund, the biggest fund ever to invest

772
00:44:46,239 --> 00:44:50,319
Speaker 1: in tech companies. He was literally about to close his

773
00:44:50,520 --> 00:44:54,920
Speaker 1: second fund billion dollars, another hundred billion dollar fund to

774
00:44:55,000 --> 00:44:58,680
Speaker 1: just go and like pour into companies. And then I

775
00:44:58,680 --> 00:45:00,440
Speaker 1: mean we've heard from all these people were out and

776
00:45:00,520 --> 00:45:04,440
Speaker 1: meeting Sovereign Wealth Fund Saudi Arabia and they were just

777
00:45:04,480 --> 00:45:06,960
Speaker 1: like every meeting it was like what about we work?

778
00:45:07,400 --> 00:45:09,600
Speaker 1: And you know, one of the things we've heard was

779
00:45:09,680 --> 00:45:13,480
Speaker 1: he was pushing for it to just go public, um,

780
00:45:13,600 --> 00:45:15,200
Speaker 1: you know, or to or not to to not go

781
00:45:15,320 --> 00:45:16,840
Speaker 1: public because he didn't want to take the mark. You

782
00:45:16,880 --> 00:45:19,200
Speaker 1: don't want to make all this public. And we have

783
00:45:19,200 --> 00:45:21,600
Speaker 1: a scene in the book about this that Massa tries

784
00:45:21,640 --> 00:45:24,040
Speaker 1: to tell him to call off the I p O

785
00:45:24,120 --> 00:45:28,439
Speaker 1: and try to force his hand, and Adam is confusing. Yeah, right,

786
00:45:28,520 --> 00:45:32,640
Speaker 1: it's it's it's really quite it's really quite astounding that

787
00:45:32,719 --> 00:45:37,480
Speaker 1: we end up with, what did he burn through billion?

788
00:45:37,719 --> 00:45:40,959
Speaker 1: More than ten billion dollars? I think, yeah, that's that's

789
00:45:41,239 --> 00:45:44,879
Speaker 1: a lot change essentially. So so here's the curve bowl

790
00:45:45,000 --> 00:45:47,400
Speaker 1: question to ask you. So you're now a business reporter

791
00:45:47,480 --> 00:45:51,160
Speaker 1: at the times we work. Obviously isn't the only company

792
00:45:51,280 --> 00:45:55,600
Speaker 1: led by an eccentric leader? What are you reporting on now?

793
00:45:55,760 --> 00:45:59,440
Speaker 1: What's the next potential we work out there? You know?

794
00:45:59,520 --> 00:46:02,319
Speaker 1: I'm just getting started. This is just a couple of

795
00:46:02,320 --> 00:46:05,840
Speaker 1: weeks in, but so it's I don't quite know what

796
00:46:05,960 --> 00:46:08,640
Speaker 1: the next we work is. I almost feel like there's

797
00:46:08,640 --> 00:46:11,480
Speaker 1: a lot of many we works out there, whether it's

798
00:46:11,560 --> 00:46:14,120
Speaker 1: you know, the companies in the stack market, some of

799
00:46:14,160 --> 00:46:18,120
Speaker 1: these unicorns. I mean there's so many, um, so many

800
00:46:18,160 --> 00:46:21,400
Speaker 1: red flags around these companies, like saying before, like founders

801
00:46:21,400 --> 00:46:25,680
Speaker 1: taking money out very early and you know investors not

802
00:46:25,719 --> 00:46:28,080
Speaker 1: really caring and just wanting to get into them, getting

803
00:46:28,080 --> 00:46:33,399
Speaker 1: these massive packages, um pay packages, compensation. So I think

804
00:46:33,440 --> 00:46:36,239
Speaker 1: there's there's so many different places to look. I don't

805
00:46:36,239 --> 00:46:39,359
Speaker 1: get the sense that there's one company now that's sort

806
00:46:39,400 --> 00:46:42,239
Speaker 1: of of size of Adam Newman. I think there's just

807
00:46:42,360 --> 00:46:44,560
Speaker 1: a lot of many ones. I mean, he was a

808
00:46:44,640 --> 00:46:49,440
Speaker 1: pretty like uh captivating and just insane. It's so many

809
00:46:49,520 --> 00:46:52,279
Speaker 1: larger than life in so many ways. Um, But I

810
00:46:52,320 --> 00:46:55,280
Speaker 1: have no doubt we're going to find one of them

811
00:46:55,520 --> 00:46:58,640
Speaker 1: fairly soon. There'll be more. And what do you think

812
00:46:58,719 --> 00:47:02,239
Speaker 1: the future holds for Adam Newman himself? He we we

813
00:47:02,320 --> 00:47:06,520
Speaker 1: have to talk about the Golden parachute. So not only

814
00:47:06,760 --> 00:47:11,040
Speaker 1: does uh soft Bank refinance a couple of hundred million

815
00:47:11,040 --> 00:47:13,799
Speaker 1: dollars in loans that he has outstanding. They give him

816
00:47:13,800 --> 00:47:17,719
Speaker 1: a hundred and eighty three million dollar package and essentially

817
00:47:17,719 --> 00:47:22,120
Speaker 1: purchase a billion dollars of his stock, so he leaves

818
00:47:22,200 --> 00:47:25,279
Speaker 1: we work as a billionaire. Yeah, it was I mean,

819
00:47:25,280 --> 00:47:27,280
Speaker 1: it was just an incredible thing. And I mean then

820
00:47:27,760 --> 00:47:29,719
Speaker 1: he got this pay package that they agreed to as

821
00:47:29,760 --> 00:47:31,960
Speaker 1: part of the bailout. I mean, we were once the

822
00:47:31,960 --> 00:47:34,160
Speaker 1: I p O Is called off, was on the verge

823
00:47:34,160 --> 00:47:36,080
Speaker 1: of bankruptcy and they were going to run out of

824
00:47:36,080 --> 00:47:37,360
Speaker 1: money in a couple of months, so they had to

825
00:47:37,360 --> 00:47:41,480
Speaker 1: do this very quickly. They were laid off thousands upon

826
00:47:41,520 --> 00:47:46,280
Speaker 1: thousands of people. But basically as part of the negotiations

827
00:47:46,280 --> 00:47:49,200
Speaker 1: to get Adam Newman to give up his super voting shares,

828
00:47:49,239 --> 00:47:51,759
Speaker 1: these potent shares that would have let him continue to

829
00:47:51,840 --> 00:47:55,200
Speaker 1: keep control of the company. To do that, they struck

830
00:47:55,280 --> 00:47:58,080
Speaker 1: this pay package. And I mean it's kind of interesting

831
00:47:58,120 --> 00:48:00,400
Speaker 1: when we talk about the power of founder is right

832
00:48:00,440 --> 00:48:03,120
Speaker 1: now that it wasn't a wake up call for Silicon

833
00:48:03,200 --> 00:48:05,920
Speaker 1: Valley to be more wary of giving this power to founders.

834
00:48:06,000 --> 00:48:08,200
Speaker 1: Like when you saw the price tag that Avenue and

835
00:48:08,360 --> 00:48:11,920
Speaker 1: extracted the cost of pushing out a founder who's kind

836
00:48:11,920 --> 00:48:15,920
Speaker 1: of a disastrous founder at some point. Yeah, I remember

837
00:48:16,000 --> 00:48:18,640
Speaker 1: reading that and thinking Sun played it terribly. He could

838
00:48:18,640 --> 00:48:21,080
Speaker 1: have said, hey, listen, I got a hundred billion dollars

839
00:48:21,080 --> 00:48:23,800
Speaker 1: worth of other investments. If I take a ten billion

840
00:48:23,840 --> 00:48:26,319
Speaker 1: dollar right down, it'll hurt, but I still have plenty

841
00:48:26,360 --> 00:48:29,400
Speaker 1: of other money. If this goes belly up, your broke.

842
00:48:29,520 --> 00:48:34,120
Speaker 1: Your a disaster, except I'll give you fifty million dollars

843
00:48:34,480 --> 00:48:38,200
Speaker 1: or else you're just impoverished. Good luck fighting the lawsuits

844
00:48:38,239 --> 00:48:40,080
Speaker 1: for the rest of your life. That would have been

845
00:48:40,080 --> 00:48:42,960
Speaker 1: the play. But he didn't. I guess it was the

846
00:48:43,000 --> 00:48:45,560
Speaker 1: other second funds he didn't want to put at risk.

847
00:48:45,719 --> 00:48:48,960
Speaker 1: What Why Why didn't he hardball New Because I thought

848
00:48:49,080 --> 00:48:52,640
Speaker 1: Son had all the leverage in that negotiation. That was

849
00:48:52,680 --> 00:48:55,319
Speaker 1: one of the like the enduring mysteries I think of

850
00:48:55,400 --> 00:48:58,439
Speaker 1: this whole story because all the things you said are right.

851
00:48:58,640 --> 00:49:03,000
Speaker 1: Plus Adam had taken out so much money in terms,

852
00:49:03,040 --> 00:49:05,920
Speaker 1: he had so much lent against his stock at forty

853
00:49:05,960 --> 00:49:09,960
Speaker 1: seven billion dollars I mean JP Morgan, um Ubs credit sweets.

854
00:49:09,920 --> 00:49:12,200
Speaker 1: They had lent him hundreds of millions of dollars and

855
00:49:12,239 --> 00:49:14,600
Speaker 1: he would have gotten to default. He didn't necessarily have

856
00:49:14,640 --> 00:49:17,759
Speaker 1: the liquidity to pay back everything he had borrowed. So

857
00:49:17,960 --> 00:49:20,560
Speaker 1: it was I mean, it's kind of amazing in terms

858
00:49:20,600 --> 00:49:24,920
Speaker 1: of his negotiating um skills that Massa and soft Bank.

859
00:49:25,000 --> 00:49:28,440
Speaker 1: It was led by Marcello Clara, who's UM now that

860
00:49:28,480 --> 00:49:32,240
Speaker 1: we work executive chairman. They blinked first. They gave Adam

861
00:49:32,280 --> 00:49:34,600
Speaker 1: a lot, and I totally agree with you. One of

862
00:49:34,640 --> 00:49:36,280
Speaker 1: the things I've heard it was just like the interest

863
00:49:36,320 --> 00:49:39,560
Speaker 1: of time. They just wanted done ten billion dollars or

864
00:49:39,560 --> 00:49:41,759
Speaker 1: whatever is and doesn't mean that much. They wanted to

865
00:49:41,760 --> 00:49:45,000
Speaker 1: just keep on moving, keep on spending, not distract too much,

866
00:49:45,040 --> 00:49:48,040
Speaker 1: and just get this done. But it's crazy. I mean

867
00:49:48,080 --> 00:49:51,280
Speaker 1: that the time value of money could be the greatest

868
00:49:51,680 --> 00:49:55,279
Speaker 1: golden parachute in the history of corporate America. I mean,

869
00:49:55,520 --> 00:49:58,360
Speaker 1: I'm hard pressed to think of anybody who on the

870
00:49:58,400 --> 00:50:00,920
Speaker 1: way out of a failing company, and it was a

871
00:50:00,920 --> 00:50:04,480
Speaker 1: failing company that moment squeeze more money out of out

872
00:50:04,480 --> 00:50:06,480
Speaker 1: of their board. And just to say, I mean Andrew

873
00:50:06,520 --> 00:50:10,240
Speaker 1: Ross working at in his first big interview with Adam,

874
00:50:10,480 --> 00:50:14,879
Speaker 1: um that he gave was I mean, Adam defended it

875
00:50:15,000 --> 00:50:18,239
Speaker 1: in different ways. I mean Andrew very much pushed him on,

876
00:50:18,320 --> 00:50:21,360
Speaker 1: like why that was okay and very aggressively. There was

877
00:50:21,400 --> 00:50:25,880
Speaker 1: early November and he was sort of contrite and you know,

878
00:50:26,239 --> 00:50:30,839
Speaker 1: a little shifty um, but for the most part, surprisingly transparent.

879
00:50:31,160 --> 00:50:33,560
Speaker 1: I was when I was prepping for this, I watched

880
00:50:33,640 --> 00:50:37,560
Speaker 1: this and uh, you know, you could see how he

881
00:50:37,800 --> 00:50:42,400
Speaker 1: constructs that you know, reality distortion field. Um. But there

882
00:50:42,480 --> 00:50:46,200
Speaker 1: was definitely more humility than we've seen previously. I don't

883
00:50:46,200 --> 00:50:50,320
Speaker 1: want to say you humble, but just closer on that spectrum.

884
00:50:50,480 --> 00:50:54,680
Speaker 1: Pretty clearly he wants to have a future in business

885
00:50:55,120 --> 00:50:58,399
Speaker 1: and he needs to offer a few minukulpas of his own.

886
00:50:58,560 --> 00:51:00,920
Speaker 1: It does feel like this was the first step on

887
00:51:00,960 --> 00:51:04,040
Speaker 1: the comeback tour Adam Newman. I think that's going to

888
00:51:04,080 --> 00:51:07,319
Speaker 1: be a pretty big uphill battle. That's gonna be quite

889
00:51:07,320 --> 00:51:11,120
Speaker 1: the kill himan jar or to uh to mount given

890
00:51:11,200 --> 00:51:13,719
Speaker 1: what a debacle. The interesting thing just so in terms

891
00:51:13,760 --> 00:51:15,799
Speaker 1: of his next step is I agree with you there's

892
00:51:15,800 --> 00:51:18,839
Speaker 1: an uphill battle in terms of maybe getting people to

893
00:51:18,840 --> 00:51:21,839
Speaker 1: to give him money. But he now has a lot

894
00:51:21,920 --> 00:51:25,719
Speaker 1: of money and from family office, yeah, exactly. Anecdotally it

895
00:51:25,719 --> 00:51:27,399
Speaker 1: sounds like a lot of people are very happy to

896
00:51:27,400 --> 00:51:30,120
Speaker 1: take his money. So the beginning, that's you know, he's

897
00:51:30,160 --> 00:51:32,480
Speaker 1: seeding a lot of things that who knows where they're

898
00:51:32,480 --> 00:51:35,400
Speaker 1: gonna go interesting. So I only have you for a

899
00:51:35,480 --> 00:51:37,800
Speaker 1: limited amount of time. Let me jump to our favorite

900
00:51:37,880 --> 00:51:41,799
Speaker 1: questions we ask all of our guests, starting with UM,

901
00:51:41,920 --> 00:51:45,239
Speaker 1: you spend a lot of time researching and writing during

902
00:51:45,239 --> 00:51:48,480
Speaker 1: the lockdown. Did you have any time to stream anything

903
00:51:48,560 --> 00:51:52,359
Speaker 1: on Netflix or Amazon Prime? Um? There, I mean there's

904
00:51:52,360 --> 00:51:56,080
Speaker 1: still a lot of like downtime. I did probably watch

905
00:51:56,640 --> 00:51:59,799
Speaker 1: not much, you know, there there was downtime and UM,

906
00:51:59,840 --> 00:52:03,840
Speaker 1: I did have a few shows, give us one or

907
00:52:03,840 --> 00:52:08,959
Speaker 1: two favorites, little fires everywhere. I really liked UM never

908
00:52:09,080 --> 00:52:11,640
Speaker 1: have I ever. I just started watching that last week.

909
00:52:11,680 --> 00:52:15,560
Speaker 1: It's quite charming. Anything Mindy Kaling does, it's quite amusing.

910
00:52:15,719 --> 00:52:19,279
Speaker 1: She's amazing. Ship's Creek we got through the whole that

911
00:52:19,360 --> 00:52:22,319
Speaker 1: was my favorite pandemic. So the funny thing about that

912
00:52:22,480 --> 00:52:25,879
Speaker 1: is the first episode of two or like uh, it's

913
00:52:25,880 --> 00:52:28,640
Speaker 1: like it's like Succession. You don't like any of these people.

914
00:52:29,120 --> 00:52:32,480
Speaker 1: The difference being in Ship's Creek you quickly start to

915
00:52:32,520 --> 00:52:35,439
Speaker 1: warm up to them and they start to reveal their

916
00:52:35,480 --> 00:52:42,839
Speaker 1: own path to um rehabilitation of themselves. It's better like

917
00:52:43,000 --> 00:52:46,520
Speaker 1: every and then it's so it was really great right

918
00:52:46,640 --> 00:52:49,000
Speaker 1: that that was one of my favorites. Let's talk about

919
00:52:49,000 --> 00:52:53,719
Speaker 1: your mentors who helped shape your career as a business journalist. UM.

920
00:52:53,920 --> 00:52:57,640
Speaker 1: I guess my earliest UM mentor as a journalist in

921
00:52:57,719 --> 00:53:01,919
Speaker 1: general was in college. I'd always thought about journalism and

922
00:53:02,040 --> 00:53:07,320
Speaker 1: I got an internship with UM then I think septagenarian

923
00:53:07,760 --> 00:53:10,759
Speaker 1: UM journalist. He his name is Gabe Pressman. I grew

924
00:53:10,840 --> 00:53:13,600
Speaker 1: up in New York. He was an NBC journalist. UM

925
00:53:13,680 --> 00:53:18,160
Speaker 1: this sort of the political head haunch of local journalism.

926
00:53:18,200 --> 00:53:19,920
Speaker 1: I worked for him first summer. He was in his

927
00:53:20,040 --> 00:53:22,719
Speaker 1: I think late seventies, and UM, he was just the

928
00:53:22,760 --> 00:53:25,960
Speaker 1: most energetic, passionate journalist I've ever met. He was still

929
00:53:26,000 --> 00:53:30,000
Speaker 1: like chasing after mayors, grilling them. Um. It was it

930
00:53:30,080 --> 00:53:32,319
Speaker 1: was the Senate race. It was Hillary in the Senate race,

931
00:53:32,520 --> 00:53:35,399
Speaker 1: and m it was like the most fun summer I've

932
00:53:35,440 --> 00:53:38,319
Speaker 1: ever had. And seeing his energy and and he he

933
00:53:38,360 --> 00:53:41,040
Speaker 1: passed away a few years ago, but literally he started

934
00:53:41,120 --> 00:53:45,560
Speaker 1: blogging into his nineties and he would joke, he would say, UM,

935
00:53:45,600 --> 00:53:47,239
Speaker 1: you know, my wife really wants me to like take

936
00:53:47,239 --> 00:53:49,840
Speaker 1: a step back and work at Teach, a Columbia journalism

937
00:53:49,880 --> 00:53:52,319
Speaker 1: school where he had gone, and he was like, I'm

938
00:53:52,360 --> 00:53:55,840
Speaker 1: just not ready like at some point like scale back,

939
00:53:55,880 --> 00:53:58,839
Speaker 1: and he never really did. Um so he I would

940
00:53:58,840 --> 00:54:01,640
Speaker 1: say he was my first mentor just seeing like that.

941
00:54:01,719 --> 00:54:03,840
Speaker 1: It is the most fune job in the world. He

942
00:54:03,960 --> 00:54:06,879
Speaker 1: just seeing that day in and day out. Let's talk

943
00:54:06,880 --> 00:54:09,920
Speaker 1: about books. What are some of your favorites and and

944
00:54:09,960 --> 00:54:13,440
Speaker 1: what are you reading right now? Sure, I'll start. Um.

945
00:54:13,520 --> 00:54:17,760
Speaker 1: You know, I always wish I read more fiction, but um,

946
00:54:17,800 --> 00:54:22,160
Speaker 1: it's like it's always get pulled into, especially the business genre. Um.

947
00:54:22,360 --> 00:54:25,560
Speaker 1: So I write At this minute, I'm reading Trillions by

948
00:54:25,680 --> 00:54:29,680
Speaker 1: Robbin's Wigglesworth. Um. It's really good. It's about like index

949
00:54:29,760 --> 00:54:33,520
Speaker 1: funds sort of. I'm learning a lot from it. Um.

950
00:54:33,560 --> 00:54:38,759
Speaker 1: The right was gaek for two weeks ago. I'm midway through,

951
00:54:38,800 --> 00:54:42,319
Speaker 1: but I'm really interesting a ton from it. I just

952
00:54:42,520 --> 00:54:46,920
Speaker 1: um read Anderson Cooper's book about the Vanderbilts. It's I

953
00:54:46,960 --> 00:54:50,400
Speaker 1: thought it was really great and it's so interesting. You

954
00:54:50,400 --> 00:54:53,000
Speaker 1: know he talks it starts like the Gilded Age and

955
00:54:53,040 --> 00:54:56,040
Speaker 1: you just see so many like eerie kind of parallels

956
00:54:56,160 --> 00:54:59,480
Speaker 1: um between our age right now, and just like the

957
00:54:59,560 --> 00:55:03,160
Speaker 1: level of like wealth creation and what it leads to.

958
00:55:03,600 --> 00:55:06,480
Speaker 1: So um, I've really enjoyed that. I read, Um, this

959
00:55:06,560 --> 00:55:09,680
Speaker 1: is a little bit dated, but say nothing by Patrick

960
00:55:09,719 --> 00:55:13,160
Speaker 1: Grad and Keith It's about the troubles in Northern Ireland.

961
00:55:13,800 --> 00:55:16,319
Speaker 1: It is, I mean, it's it's very sad, but I

962
00:55:17,040 --> 00:55:19,520
Speaker 1: then it's pretty long and I just could not put

963
00:55:19,520 --> 00:55:22,160
Speaker 1: it down. It's so great. Yeah, I can't recommend that

964
00:55:22,160 --> 00:55:25,800
Speaker 1: one highly enough. Quite quite interesting. What sort of advice

965
00:55:25,840 --> 00:55:28,200
Speaker 1: would you give to a recent college grad who was

966
00:55:28,360 --> 00:55:34,240
Speaker 1: interested in a career in either journalism or or business. Um,

967
00:55:34,280 --> 00:55:36,839
Speaker 1: In terms of journalism, I would just say jump in.

968
00:55:36,920 --> 00:55:39,319
Speaker 1: I mean, it's such a as opposed to business. I

969
00:55:39,320 --> 00:55:42,200
Speaker 1: felt like when I graduated from college, you know, so

970
00:55:42,239 --> 00:55:44,879
Speaker 1: many people had jobs set they were going to make,

971
00:55:45,120 --> 00:55:47,920
Speaker 1: you know, a decent amount of money. And with the

972
00:55:48,000 --> 00:55:50,759
Speaker 1: journalism you just have to find your way in and

973
00:55:50,800 --> 00:55:53,880
Speaker 1: a lot of its internships, and it's just the path

974
00:55:54,040 --> 00:55:56,759
Speaker 1: is hard, there's no straight line. So I would just

975
00:55:56,760 --> 00:55:59,600
Speaker 1: say for journalism it really helps to just jump into

976
00:55:59,600 --> 00:56:01,960
Speaker 1: the first job you can get, work really hard in it,

977
00:56:02,040 --> 00:56:04,880
Speaker 1: and you just always have to keep there's no straight line,

978
00:56:05,160 --> 00:56:09,640
Speaker 1: but jump in, learn from it, meet people, find your

979
00:56:09,680 --> 00:56:12,520
Speaker 1: mentors everywhere you go, and just keep going. You learn

980
00:56:12,560 --> 00:56:14,680
Speaker 1: so much on the job. I went to journalism school

981
00:56:14,680 --> 00:56:18,040
Speaker 1: at Columbia. It was a super fun year. But it's like,

982
00:56:18,520 --> 00:56:21,960
Speaker 1: within two days of um working as a journalist, you

983
00:56:22,080 --> 00:56:24,160
Speaker 1: just learned so much you can ever learn in school.

984
00:56:24,920 --> 00:56:27,319
Speaker 1: And our final question, what do you know about the

985
00:56:27,360 --> 00:56:32,160
Speaker 1: world of I P o S. Capital market business journalism

986
00:56:32,160 --> 00:56:35,719
Speaker 1: today that you didn't know fifty years ago when you

987
00:56:35,760 --> 00:56:38,680
Speaker 1: were first starting out. Okay, what I think I've learned

988
00:56:38,680 --> 00:56:42,799
Speaker 1: and probably the most in writing this book is you

989
00:56:42,840 --> 00:56:47,480
Speaker 1: think people are rational players, and you think that um,

990
00:56:47,760 --> 00:56:50,640
Speaker 1: titans of business are supposed to behave in sort of

991
00:56:50,640 --> 00:56:54,479
Speaker 1: a rational way, and UM that these you know, these

992
00:56:54,560 --> 00:56:58,200
Speaker 1: check marks, these um like a t ro price or something,

993
00:56:58,239 --> 00:57:00,400
Speaker 1: or fidelity that they're gonna do a certain amount of

994
00:57:00,440 --> 00:57:03,920
Speaker 1: work looking at things. And I think the level of

995
00:57:04,560 --> 00:57:09,040
Speaker 1: irrationality in business, of just relationships of people sort of

996
00:57:09,680 --> 00:57:13,040
Speaker 1: um not necessarily making rational decisions and just going with

997
00:57:13,080 --> 00:57:15,640
Speaker 1: their gut and going with the people they like and

998
00:57:15,760 --> 00:57:19,920
Speaker 1: think are cool like that that overrides a lot of things.

999
00:57:19,960 --> 00:57:22,520
Speaker 1: I think it's just so much less rational than you

1000
00:57:22,520 --> 00:57:25,160
Speaker 1: think it would be. And sometimes the things that on

1001
00:57:25,200 --> 00:57:31,680
Speaker 1: their face seemed really um crazy insane maybe are quite

1002
00:57:31,760 --> 00:57:35,560
Speaker 1: quite fascinating. We have been speaking with Maureen Farrell. She

1003
00:57:35,720 --> 00:57:38,760
Speaker 1: is the co author of the cultive We We Work,

1004
00:57:38,800 --> 00:57:42,520
Speaker 1: Adam Newman, and The Great Startup Delusion. If you enjoyed

1005
00:57:42,560 --> 00:57:45,360
Speaker 1: this conversation, we'll be shown check out any of our

1006
00:57:45,400 --> 00:57:49,880
Speaker 1: previous four hundred interviews. You can find those at iTunes, Spotify,

1007
00:57:50,080 --> 00:57:53,360
Speaker 1: wherever you get your podcast from. We love your comments,

1008
00:57:53,360 --> 00:57:57,840
Speaker 1: feedback and suggestions right to us at m IB podcast

1009
00:57:57,960 --> 00:58:01,600
Speaker 1: at Bloomberg dot net. Follow me on Twitter at Rid Halts.

1010
00:58:01,640 --> 00:58:04,000
Speaker 1: You can sign up for my daily reads at Rid

1011
00:58:04,040 --> 00:58:07,040
Speaker 1: Halts dot com. I would be remiss if I did

1012
00:58:07,080 --> 00:58:10,280
Speaker 1: not thank the team that helps put together these conversations

1013
00:58:10,400 --> 00:58:14,960
Speaker 1: each week. Charlie Volmer is my audio engineer. Uh Attica

1014
00:58:15,080 --> 00:58:18,720
Speaker 1: val Bron is our project manager. Michael bat Nick is

1015
00:58:18,800 --> 00:58:24,000
Speaker 1: my director of research. Harris Wald is my producer. I'm

1016
00:58:24,040 --> 00:58:27,160
Speaker 1: Barry Ri Halts. You've been listening to Masters in Business

1017
00:58:27,520 --> 00:58:28,680
Speaker 1: on Bloomberg Radio.