Chris Bryant, Columnist

WeWork's Junk Bond Adventure Raises $18 Billion Question

Startup’s lease obligations wouldn’t be that easy to wriggle out of.

April 25, 2018 at 12:40 PM UTC

Chris Bryant is a Bloomberg Opinion columnist covering industrial companies in Europe. Previously, he was a reporter for the Financial Times.

Coffee dispensers sit on a counter in a kitchen area at the Embarcadero WeWork Cos Inc. offices in San Francisco, California, U.S., on Thursday, Oct. 19, 2017. WeWork has focused its attention on Asia since 2016 with the opening of its first facility in Shanghai amid booming demand for flexible work spaces.Photographer: Mike Short/Bloomberg

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The nice thing about being a venture capitalist (from a VC standpoint) is getting to decide that the startup you’re backing is worth pretty much whatever you want. In the case of eight-year-old WeWork Companies Inc., which rents office space to entrepreneurial hipsters, SoftBank Group Corp. thinks that figure is $20 billion, give or take.

What Softbank does with its money is its concern, of course. Debt investors considering whether to buy into the $500 million junk bond issue that WeWork is marketing this week probably won’t care a jot about that dizzy valuation or the company’s highfalutin ambition to deliver "space as a service" to the "We Generation."