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WeWork starts layoffs in Israel

WeWork sent summonses to pre-layoff hearings to 65 of its employees in Israel today. These employees, who work in the Midtown building in Tel Aviv, are part of the company’s technological staff in Israel. The layoffs will leave WeWork with 250 employees in Israel, most of them in technology roles. WeWork’s Israeli co-founder and CEO Adam Neumann was recently dismissed from the company.

The layoffs in Israel are part of a global measure in the company reported in “The New York Times,” which said that WeWork was planning to lay off 4,000-6,000 employees, constituting a third of its staff. The layoffs are expected to include 2,500 employees working on the company’s core business – renting out its properties in short-term leases. WeWork will also lay off 2,000 maintenance and renovation employees, some of whom will be employed by contracting companies that will continue working with WeWork.

WeWork put off its IPO when many investors questioned its business and corporate model, after the company’s prospectus revealed large losses, a dubious business model, and questionable behavior by Neumann. WeWork’s biggest investor, Softbank, injected $1.7 billion into the company, while taking possession of 80% of its shares at a company valuation of only $8 billion, compared with its $47 billion valuation before the IPO.

Neumann was forced to resign as CEO and surrender control of the company, which began a streamlining process in both personnel and spheres of activity. In addition to renting out offices on short-term leases, WeWork also has activities such as operating schools and kindergartens.

WeWork said, “As part of our renewed focus on WeWork’s core business, and as recently explained to the staff, the company is having to carry out layoffs in order to create a leaner and more efficient enterprise. The technological staff in Israel continues to be an important element in WeWork’s global activity, which provides solutions for our community experience and business needs. We thank all of our employees who helped establish WeWork as a successful global brand, and we are committed to acting with full respect and fairness towards the employees who are leaving their jobs.”

Published by Globes, Israel business news – en.globes.co.il – on November 21, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019


Article source: https://en.globes.co.il/en/article-1001308175#utm_source=RSS

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