WeWork Co-Founder Miguel McKelvey Leaving Coworking Company
By Nicholas Rizzi June 5, 2020 10:25 amreprints
WeWork co-founder Miguel McKelvey — who largely stayed out of the public eye compared to the bombastic Adam Neumann — will leave the struggling coworking giant at the end of the month, WeWork confirmed.
McKelvey sent a note to WeWork employees this morning announcing his departure from the company, where he currently serves as the chief culture officer, CNBC first reported.
“After 10 years, I’ve made one of the most difficult decisions of my life — one that I’m not even sure has sunk in just yet,” McKelvey wrote in the note sent to WeWork employees. “While it’s hard to leave, and I know there is a lot more work to be done, I could only make this decision knowing this company and our people are in good hands.”
McKelvey’s email did not give a specific reason for his departure or if he was taking another job.
“Miguel’s dedication to establishing a community that fosters connection and compassion has helped build a business that recognizes and celebrates inclusivity, authenticity, learning, and growth,” Sandeep Mathrani, the CEO of WeWork, said in a statement. “I am confident Miguel will bring the same entrepreneurial spirit to his future endeavors and we wish him all the best in what lies ahead.”
McKelvey’s departure comes as WeWork struggles to survive the coronavirus pandemic — which forced most of its members to work remotely — and after the company’s disastrous 2019 that included a failed initial public offering, Neumann leaving, thousands of layoffs and its valuation slashed by nearly $44 billion to $2.9 billion.
The company is also facing a class-action lawsuit from investors over the botched IPO while members are threatening legal action over WeWork’s decision to charge membership fees during the pandemic.
McKelvey was working in an architecture firm in Dumbo, Brooklyn, when he met Neumann, who was running a baby clothing store in the same building. The pair convinced their landlord at 155 Water Street to let them lease vacant space to startups with flexible leases and dubbed the company Green Desk.
They eventually sold Green Desk to their landlord and launched WeWork in Manhattan in 2011. Since then, WeWork grew to more than 800 locations across the world and become the single largest office tenant in Manhattan.
Throughout the years McKelvey largely took a backseat to Neumann’s outsized personality — instead focusing on design work for the firm — while Neumann raised billions and moved WeWork into the co-living and education spaces.
“As Miguel focused on more culture things, Adam focused on, frankly, the things that were driving headlines,” a former WeWork executive told Forbes last year. “The value was created in Adam’s ability to raise money from Masa [Son], which Miguel was not involved in directly.”
In the run-up to the ultimately failed IPO that shined a light on WeWork’s money-burning business model, Neumann was pushed out of the company after reports of his erratic behavior as CEO became public. McKelvey stayed on as chief culture officer and worked with SoftBank Group executives after the Japanese bank took control of the company in October 2019.
“The night before I took on the role of Executive Chairman of WeWork, Miguel and I stayed up past midnight talking about the culture of WeWork and the undeniable magic this company and its people have to offer,” Marcelo Claure, the COO of SoftBank and the executive chairman of WeWork, said in a statement. “Just looking at our thousands of employees and more than 600,000 members around the world is a testament to the true power and value of what Miguel has helped to build — a place for everyone to make a difference. I will be forever grateful to have learned so much from him not just as a colleague, but a true friend.”
While the troubles at WeWork caused its valuation to fall, it also cut McKelvey’s net worth. Forbes estimates that McKelvey’s net worth reached a peak of $2.9 billion but fell to $900 million after the turmoil at WeWork.
Neumann’s net worth also fell to $750 million and he recently filed a lawsuit against SoftBank over its decision to cancel a $3 billion buyback of WeWork shares, which included Neumann’s nearly $1 billion golden parachute.