How WeWork's CEO grew a $10 billion relationship with SoftBank CEO Masayoshi Son, whom he calls 'Yoda'

masayoshi son

Masayoshi Son is the founder and CEO of the Japanese holding company SoftBank, which is a major investor in scaling American companies, including WeWork.
WeWork cofounder and CEO Adam Neumann told Business Insider that his personal relationship with Son is one of the intangible assets headed into a potential IPO.
C-Suite Insider is a collection of exclusive interviews with leaders of the world's largest companies.
Visit Business Insider's homepage for more stories.

Wall Street is paying close attention to WeWork, as the global coworking-space giant is preparing to go public. One investor, Masayoshi Son of the powerful Japanese holding company SoftBank, has bet more than $10 billion that it will succeed.

Business Insider had an extensive interview with WeWork's cofounder and CEO, Adam Neumann, at its Manhattan headquarters last week, and he argued that his company is in better shape than critics think. He explained that his close relationship with Son — he calls him by his nickname, "Masa" — is one of the intangible assets he has on his side.

"I'm usually the person who thinks very large in the room," Neumann told us. "But with Masa, it doesn't matter how big you're thinking — he's going to out think you. He'll go bigger. I learned a lot from that. I still learn every time I interact with him." He noted that in his best relationships with investors, like the one with Son, he is especially receptive to their advice and criticism.

"In Masa's case, he does very well face-to-face," he said. "I'll get on the plane and go to Tokyo, even if it's not always easy, and develop a personal relationship." He mentioned in our interview that in a few days he and his wife Rebekah, WeWork's chief brand officer, were headed to Tokyo to have dinner with Son.

"Masa and Rebekah get along very well, which is fascinating, because she's very picky. She likes him a lot. She calls him Yoda," Neumann said, referring to the "Star Wars" character. "He is Yoda. He has the Force with him." Son invites the nickname — regularly quoting the little green guru in meetings and presentations.

Neumann said that an unexpected challenge last December proved to him the strength of his relationship with Son.

SoftBank was planning on investing $20 billion in WeWork by the end of the year, and Neumann was weighing his options. WeWork confidentially filed for an IPO.

Neumann explained why:

"I filed because I wanted optionality. A: The fact that we agreed on a deal doesn't mean the deal is done — which ended up being the case, because it wasn't signed yet. B: Until that moment of signature, I would still have to impose such a big move not just for myself but for the employees, for the investors, for our members. I would've really taken that last look once it was all said and done. What's better for all of our employees and members?"

Son called Neumann on December 24 (Japan's stock markets are open on Christmas Eve) to tell him the investment was going to be significantly smaller. The investment would be coming from SoftBank, whose stock was struggling, not its $100 billion Vision Fund, and would only be $4 billion, at $110 a share. Neumann pushed back with an offer for $5 billion, to which Son agreed, adding that he also wanted $1 billion in secondary, which is to say he also wanted to invest a total of $6 billion, with $1 billion of that toward existing shares. They had a deal. (Neumann noted that reports of this transaction inaccurately stated the investment was supposed to be $16 billion and ended up $2 billion.)

The news was initially difficult for Neumann to accept, and he kept it a secret from his investors until Christmas ended, and even from his wife until later that night. But, he said, he was able to recover from it without damaging his relationship with Son because of the way Son handled it, and he even said that he and his investors are happy they did not sell as much as they originally planned.

"Relationships get measured when a challenge comes, not when everything is perfect," Neumann said. "He called me personally, and he was very straightforward. He told me exactly why."

Join the conversation about this story »

NOW WATCH: A Silicon Valley founder shares the 6 traits she looks for in the entrepreneurs she invests in