The WeWork “Acquisition” (with Dan Primack)

**Ben Gilbert** (0:00)
No, yeah, well, we'll cut this part out. We have a woodpecker happening.

**David Rosenthal** (0:03)
Woodpecker situation. This is a first on Acquired.

**Ben Gilbert** (0:06)
Dan's gonna take care of it.

**David Rosenthal** (0:08)
I love it.

**Ben Gilbert** (0:23)
welcome to season five, episode six of Acquired, the podcast about great technology companies and the stories behind them. I'm Ben Gilbert, and I'm the co-founder of Pioneer Square Labs, a startup studio and early stage venture fund in Seattle.

**David Rosenthal** (0:36)
I'm David Rosenthal, and I'm a general partner at Wave Capital, an early stage venture firm focused on marketplaces based in San Francisco.

**Ben Gilbert** (0:43)
And we are your hosts. Today, we tell an episode that in our initial season five planning calendar, we had as an IPO episode.
And then that was pitifully canceled. And we were just going to tell the crazy story of the antics that got it here. But now it's shaping up to be a tried and true acquisition episode for us. So here on this episode, we will dive into the existential question of if we work, a once $47 billion company can be saved by SoftBank's effective acquisition of the company. And we are going to try to accomplish two goals. First, to dive into the history of this company from the very beginning. And second, to try and see the core economic forest through the under governed trees and understand precisely the position that the business is in today.

**David Rosenthal** (1:26)
Listeners, Dan's face during all of this is priceless. If only we were a video podcast.

**Ben Gilbert** (1:32)
Which brings me to the only appropriate way that we know how to tell this story is with the expert help of Axios' Dan Primack, who has been meticulously and astutely covering this company for several years. welcome to Acquired, Dan.

**Dan Primack** (1:44)
Thanks for having me.

**Ben Gilbert** (1:46)
This is a great time to tell you about one of our very favorite companies, Crusoe.

**David Rosenthal** (1:51)
So, Crusoe, as listeners know by now, is a clean compute cloud provider specifically built for AI workloads. NVIDIA is one of their major partners, and literally Crusoe's data centers are nothing but racks and racks of A100s and H100s. And because Crusoe's cloud is purpose-built for AI and run on wasted, stranded or clean energy, they can provide significantly better performance per dollar than traditional cloud providers.

**Ben Gilbert** (2:16)
Yes, we talked about that on our ACQ2 episode with Crusoe's CEO, Chase Lockmiller.

**David Rosenthal** (2:22)
The other element that makes Crusoe special is the environmental angle. Crusoe, of course, locates their data centers at stranded energy sites. So think oil flares, wind farms that can't use all the energy they generate, etc. and uses that power that would otherwise be wasted to run your AI workloads instead.

**Ben Gilbert** (2:40)
Yep. Obviously, it's a huge benefit for the environment and for customers on costs since Crusoe doesn't rely on the energy grid. Energy is the second largest cost of running AI after, of course, the price you pay NVIDIA for the chips. And these lower energy costs get passed on to customers.

**David Rosenthal** (2:56)
It's super cool that they can put their data centers out there in these remote locations where quote-unquote energy happens, as opposed to the other hyperscalers such as AWS and Google and Azure, who need to build their data centers close to major traffic hubs where the internet happens because they are doing everything in their clouds.

**Ben Gilbert** (3:13)
Yep. If you, your company or your portfolio companies would like to use the lower cost and more performant infrastructure for your AI workloads, go to crusocloud.com/acquired. That's crusoecloud.com/acquired or click the link in the show notes. And now on to WeWork.

**David Rosenthal** (3:32)
All right. On to WeWork. Man, we were thinking about how to frame this and talking with Dan a little bit before.
And I think what we decided to go with, which is true, is like this is a tragedy. This is like a Greek tragedy.

**Dan Primack** (3:44)
Particularly for thousands of people who, by the time people listen to this, might have lost their job. I mean, within hours of when we're taping this or a day within when we're taping this.

**David Rosenthal** (3:51)
Yeah. It's like, I don't know, the Peloponnesian War or something. Like the outcome is predetermined and the actors are just caught up in forces beyond themselves.

**Dan Primack** (4:00)
Minus one actor who gets a lot of money. And I guess gets an island in the Peloponnesian Islands.

**Ben Gilbert** (4:04)
Those grandchildren, I'm sure, will have their own islands.

**David Rosenthal** (4:06)