個案資料
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The We Company: How Do You Like We Now?
內容大綱
In August 2019, WeWork filed for an initial public offering; investors in its 14 venture capital rounds were anxious for an exit. Softbank had invested US$6 billion in WeWork, including US$2 billion in the Series H round that valued the firm at US$47 billion; consequently, it hoped for a positive reception from Wall Street. While WeWork had 100 per cent recent sales growth, its net income was US$1.9 billion, and it was on pace to spend over US$5 billion in 2019; it needed capital. WeWork’s chief executive officer met with SoftBank in Tokyo to discuss a “dramatic reduction in its valuation.” Should they proceed with the IPO, even if it required a reduction in its valuation, or should they cancel the IPO and pursue an additional round of private capital?
學習目標
This case is suitable for both undergraduate- and graduate-level courses on core corporate finance to illustrate firm valuation methods for difficult to value, fast-growing, unprofitable firms. The case provides a discussion of WeWork’s business model. It examines information provided by the firm to help investors forecast potential growth and profitability and information about comparable firms, facilitating valuation analysis. After working through the case and assignment questions, students will be able to<ul><li>understand the pressures faced by late-stage venture-capital-financed firms and their investors to finance growth and realize an exit;</li><li>develop a methodology for forecasting revenue for high-growth firms and projects based on the size of the total available market;</li><li>develop a discounted cash flow valuation model for an unprofitable firm; and</li><li>use comparable firm information to help determine a firm’s equity value.</li></ul>