Corporate Adolescence: Why Did 'We' not Work?

This article explores a series of rent-seeking behaviors and fiduciary deficits that are playing role in the “growth” demise U.S. companies. Start-up financing occurs through exemptions remove disclosure obligations required public markets, assuming private ordering suffices. The exemptive-privilege premise is parties to rounds will be faithful agents, i.e., fiduciaries, their sources capital. Where there conflicts interest, arise unless either threat litigation for breaches duty sufficiently deters resulting opportunism or capital themselves watchful savvy combat opportunism. As become more numerous diverse, latter may not happen so reliably. We examine this territory business-school like case study WeWork, one most recent examples failed where prescribed corporate governance mechanisms fill gaps. WeWork’s extraordinary growth over eight both strengthened hand its CEO, Adam Neumann concealed danger signs. Indeed, absence disclosure, duties take on extra significance. Yet, WeWork board exhibited multiple what cautionary story about failure warning those who focused expanding “access” these funding rounds In short, systems designed long-term “startup” governance, reveals systemic slack flaws. Our exploration motivations, incentives opportunities start-up an accumulating set makes current state affairs problematic than conventional account would suggest. From founder control enabling self-centered, biased risky behaviors, funders with diverse sources, market “valuations” issues, result information-forcing safeguards directors focus constituent protections duties.