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Illustration: Aïda Amer/Axios

WeWork last night made it official: SoftBank will pump $9.5 billion into the beleaguered company, including a $3 billion stock tender, $5 billion of new debt, and $1.5 billion that is being accelerated from an existing equity commitment.

The big picture: There's been lots of talk of how this mess will impact startup valuations, business models, and IPO opportunities. But far too little on how it should impact board oversight and founder control.

  • Remember, SoftBank had two directors on the WeWork board. But then decided, more than a year later, that it had to bring in Marcelo Claure to figure out what was really going on. What were those directors doing all this time?
  • The board either wasn't paying attention, or was paying attention but powerless to fix problems before it was too late. And, if the latter is true, then what was the point of having a board in the first place? Optics?

The state of play: Under the new deal, SoftBank will hold an 80% stake in WeWork on a fully-diluted basis, but apparently will not have a majority of votes on the to-be-expanded board. As such, SoftBank is claiming it does not control WeWork.

But, but, but: When I spoke to an internal WeWork spokesperson today, she directed most questions about future board structure, appointments, etc. to SoftBank.

  • The press release does not make any reference to the Adam Neumann payoff, perhaps to avoid rubbing further salt in employee wounds.
  • My understanding of the tender is that all company shareholders, including both employees and investors, can tender up to 33% of their shares at $19.19 each. Were more than $3 billion to be tendered, it's likely that the company would reduce payoffs on a pro rata basis.
  • That scenario could be impacted by how much Neumann himself tenders, as he's eligible to reap more than $900 million.

The bottom line: Venture capital has spent more than a decade bending over backwards to appease founders, often with positive results. But along the way they've too often abdicated fiduciary obligations to limited partners, believing that their job ends at "making the deal" and then "helping out when needed," such as with introductions to potential new hires.

  • Investors can be founder-friendly while still packing some emergency parachutes into term sheets. And if an entrepreneur objects to even the loosest of restraints, then maybe it's not a deal worth winning.

Go deeper: How SoftBank plans to save WeWork

Go deeper

Tony Hsieh, longtime Zappos CEO, dies at 46

Tony Hsieh. Photo: FilmMagic/FilmMagic

Tony Hsieh, the longtime ex-chief executive of Zappos, died on Friday after being injured in a house fire, his lawyer told the Las Vegas Review-Journal. He was 46.

The big picture: Hsieh was known for his unique approach to management, and following the 2008 recession his ongoing investment and efforts to revitalize the downtown Las Vegas area.

Dan Primack, author of Pro Rata
3 hours ago - Economy & Business

The unicorn stampede is coming

Illustration: Annelise Capossela/Axios

Airbnb and DoorDash plan to go public in the next few weeks, capping off a very busy year for IPOs.

What's next: You ain't seen nothing yet.

16 hours ago - World

Maximum pressure campaign escalates with Fakhrizadeh killing

Photo: Fars News Agency via AP

The assassination of Mohsen Fakhrizadeh, the architect of Iran’s military nuclear program, is a new height in the maximum pressure campaign led by the Trump administration and the Netanyahu government against Iran.

Why it matters: It exceeds the capture of the Iranian nuclear archives by the Mossad, and the sabotage in the advanced centrifuge facility in Natanz.