(Bloomberg)—For the past two years, WeWork Cos. has spent more than $40 million to host a series of startup pitch competitions around the world. The real estate company asks contestants to pitch apps or creative projects to celebrity panels of judges and compete for cash prizes, in between musical performances from the likes of the Red Hot Chili Peppers. This year, it hoped to go much bigger.
WeWork teamed up with Ashton Kutcher to pitch a television show to NBC based on the contest, known as the Creator Awards, according to two people familiar with the talks. The show would be similar to Shark Tank and have camera crews follow contestants around the events. The project hasn’t panned out, though, and is currently on hold.
As WeWork prepares for an initial public offering as soon as next month, the founders want their creation to be seen as much more than a real estate business. The New York company generates most of its revenue from renting office space to workers but also runs a gym, an app for organizing social gatherings and an elementary school. The pursuit of a television deal illustrates the flashy, and often expensive, way the company approaches many aspects of its business, including marketing.
In another example that hasn’t been previously reported, WeWork explored a collaboration with Martin Scorsese, the Oscar-winning director of films such as The Departed and the forthcoming The Irishman. WeWork executives discussed hiring Scorsese to direct a series of videos promoting the brand this summer, according to two people familiar with the plan, who asked not to be identified due to disclosure restrictions around the IPO.
The idea came directly from the founders: Adam Neumann, the chief executive officer; Rebekah Paltrow Neumann, his wife and a cousin of actress Gwyneth Paltrow; and Miguel McKelvey, the chief culture officer. Other directors were also considered, though it’s not clear what decisions the company ultimately made. Representatives for Scorsese and WeWork declined to comment.
Neumann, the CEO, frequently portrays WeWork as a cross between a lifestyle brand and a technology business. For a meeting with Wall Street analysts a week ago, WeWork initially sent some invitations to tech and internet analysts, though in the end, several who cover real estate were able to attend, said a person who was there. The IPO is likely to be the biggest of the year after Uber Technologies Inc. and is slated to run alongside a $6 billion debt facility. All that cash has attracted the attention of the world’s biggest banks, some of whose CEOs have personally courted Neumann for a shot at the business.
Inside last week’s analyst event at a WeWork office in Manhattan’s financial district, Neumann and his lieutenants held court for close to three hours. During the presentation, Neumann told the audience to think of WeWork like Amazon.com Inc.—starting off in one business but rapidly expanding to others, even while unprofitable, according to the attendee, who asked not to be identified citing a nondisclosure agreement. (Uber made a similar pitch on its IPO roadshow.) Neumann then joked that he wanted to move away from Amazon comparisons because he’d been using them too often. Attendees were invited to pick from an array of swag, including mugs, T-shirts, black tote bags and umbrellas printed with the company slogan, “Do What You Love.”
Neumann, a 40-year-old Israeli immigrant with dark, flowing hair, has a star power of his own. During a question-and-answer session at the event, no analysts asked him about the controversial deals in which WeWork leased space in properties owned by Neumann. At the end of the meeting, Neumann posed for pictures with some attendees—an uncommon practice for an executive pitching his company to analysts.
For years, Neumann has used celebrities and glitzy performances to reward employees and appeal to potential members. Until recently, WeWork held an annual, multi-day festival for thousands of staff and customers called Summer Camp. The parties featured Neumann delivering inspirational orations onstage, as well as musical headliners such as Lorde, the Chainsmokers and Florence + the Machine. The company also held annual winter gatherings for its workers, usually in Los Angeles.
WeWork started the Creator Awards in 2017 as a way to expand the company’s reach to entrepreneurs who aren’t already customers. That year, WeWork spent $16.1 million on the project and invested an additional $2 million in the winning companies, according to financial documents reviewed by Bloomberg. Startups, nonprofits and artists competed for prizes at regional events, and the grand winners in 2018 and 2019 were awarded $1 million each. The final event of the first competition featured Neumann, self-help author Tim Ferriss and Miracle Mop inventor Joy Mangano as judges, a fireworks show and a live performance from rapper Macklemore.
The next year, WeWork spent $24 million on the awards, a figure that doesn’t include the cost of its final show early this year. Judges at the finals in Los Angeles included Sean “Diddy” Combs and Kutcher, who’s an actor, investor and personal friend of WeWork’s CEO. The Red Hot Chili Peppers played an hour-long set.
For the TV adaptation of the Creator Awards, WeWork held discussions with Kutcher to serve as a producer, along with Guy Oseary, a talent manager for Madonna and U2 who also runs a venture capital firm with Kutcher, people familiar with the deliberations said. WeWork held talks early this year with executives from Comcast Corp.’s NBCUniversal, the people said. Representatives for the network and WeWork declined to comment. Representatives for Kutcher and Oseary didn’t respond to requests for comment.
WeWork classifies the Creator Awards as “strategic marketing events,” according to a document relating to a 2018 bond offering. It told investors that the series, held in Berlin, Seoul, Tel Aviv and other international cities, is “a critical means through which we express our key values—inspiration, entrepreneurship, authenticity, tenacity, gratitude and togetherness.”
--With assistance from Gerry Smith, Eric Newcomer and Lucas Shaw.
To contact the author of this story: Ellen Huet in San Francisco at [email protected].
To contact the editor responsible for this story: Mark Milian at [email protected]
Anne VanderMey
© 2019 Bloomberg L.P.
