WeWork reconsiders selling start-up to its co-founder

In April last year, WeWork announced its acquisition of Managed by Q, an office management platform, according to Bloomberg, but just a few months later, WeWork’s initial public offering suffered a dramatic collapse. Soon after, a co-founder of Managed by Q negotiated a buyback with WeWork. Now, according to people familiar with the matter, the talks have broken down and the start-up is likely to be sold to rivals. People familiar with the matter spoke on condition of anonymity because the deal has not yet been finalized.

WeWork reconsiders selling start-up to its co-founder

Bloomberg reported in December that Dan Teran, co-founder of Managed by Q, had tried to get from WeWork’s parent company, We Co. Buy back the start-up. Teran and some investors are in talks to buy the start-up, which specializes in managing services and technology for less than $55 million, but WeWork paid $220 million last year for Managed by Q, according to publicly available data.

But WeWork could sell Managed by Q to Eden Technologies Inc. , the latter has competed with Managed by Q. One of the people said the final price exceeded the price offered by Teran and his investors.

In the past few months, WeWork has sold a number of previous acquisitions and investments, some at significant discounts to previous purchaseprices. After WeWork failed to go public last September, the company, known for burning money, ran out of money for just a few months and had to be bailed out by softbank, its biggest investor, and WeWork chief executive Adam Neumann resigned. WeWork’s new leadership plans to slash spending and make profits its main target, including trying to recoup some of the money by selling some of the acquisitions and refocusing on the core business of office leasing. WeWork also said it cut about 2,400 jobs late last year.

Since November, WeWork has sold its investment in the women’s co-office space The Wing and sold teem, an office space technology company. In December, the company also sold Conductor, a marketing software start-up acquired in 2018, to a group of investors, including its founder.

Neumann is also selling some of its assets. This month, he sold his stake in a real estate development company in San Jose, California.