Good morning and happy Friday.
The recession watch was back on again this week, thanks to the fact that interest rates for ten-year Treasury notes dropped below those for two-year Treasury bills. Other economic indicators are more mixed. Fortune looks at several of them here, and comes up with no clear conclusion.
But if a recession is coming, the WeWork IPO filing, out this week, will be a fitting capstone for the peak.
Writing for Fortune, Ellen Florian looks at the oddities of corporate governance in the filing—not only that founder Adam Neumann has voting control, but that his wife chooses his successor. “It’s a mess any way you look at it from a governance standpoint,” says Charles Elson, a corporate governance expert.
Meanwhile, Fortune’s Kristen Bellstrom writes that the company is coming to market with an all-male board—exceedingly strange for a supposedly woke company.
Bloomberg’s Shira Ovide notes WeWork is spending almost as much in operating costs as it takes in in revenue. “It’s growth is overwhelming, but it’s not clear it got there in a sustainable way,” she says.
And then there’s the odd clause that gives Neumann a giant payday if the company’s valuation reaches $90 billion. Really?
Here’s how Ovide sums it up:
“In short, everything about WeWork is utterly odd. It is a real estate company valued like a tech company. It is a young company with questionable economics that has committed to paying tens of billions of dollars in future years for office building leases. This is a company whose intricate relationships with its chief executive requires 10 pages of disclosures. And this may be the first time I’ve seen an IPO filing with a section titled “Expected Resilience in a Downturn.”
The end may be near. Other news below.