Woozy WeWork Targets Global Investment Banking In Fertility Via IPO Fast Track
Halloween is fast approaching, and many cannot help but wonder if We Co. ne WeWork will wear their well-publicized “landlord costume” (think Mr. Roper from “Three’s Company”) to the party. Or, will they unmask themselves as the Private Equity shop, Broker Dealer and International Investment Bank that WeWork really is, with deep-dive dibs on the Fertility, Fintech and Healthcare startup spaces?
This article will reveal gaping holes in financial, securities and markets disclosures that are sourced from WeWork’s David Koresh-like reach to corner the whole psyche of the entrepreneur, most recently, the Healthcare and Fertility entrepreneur. WeWork aims to own the evolution of the entrepreneur and already pitches its resident businesses access to banking, lending and capital. We Co.’s high-end coffee / juice bars and social scene add-ons all serve to hypnotize the Millennial entrepreneur into investment banking and private transactions BDSM-like submission.
WeWork Property Advisors, LLC is an approximately $1B group of pooled investment vehicles with books and records in the Cayman Islands. In hedge fund-like fashion, the Registered Investment Advisor charges a percentage of assets under management and performance-based fees. Rhone Group LLC and Rhone Group WW Holdings is a majority owner, and additional ownership runs just south of jigsaw.
In the same exact 12 E. 49th St. NYC prime real estate as WeWork is Rhone Group LLC, the investment adviser firm and Rhone Group Advisors LLC, the Brokerage Firm and Investment Bank. Rhone Group has numerous underlying subsidiaries and corporate structures, control persons both foreign and domestic, indirect and direct owners and control persons, and p.o. boxes in the Cayman Islands (which is where We Work Property Advisors keeps compliance records).
We Work’s portfolio company strategist and unlicensed fundraiser, Jillian Canning, came out on September 5th and said, “After reading through thousands of applications each year while I was at Techstars, I started to notice a significant influx in the number of startups in the fertility space… This opens up a massive opportunity for startups to innovate in the space.“
Jillian Canning’s Forbes bio also states, “Jillian leads Portfolio Strategy for WeWork Labs and helps portfolio companies with fundraising and operations.” Who better than WeWork’s portfolio strategy manager and startup soliciting fundraiser to detail “18 Fertility Startups to Watch By Stage” and detail the exact Women’s Health companies We Co. ne WeWork is now targeting. The companies range from Seed funding rounds to Series A and debt financing rounds.
WeWork’s NYC roomies, Rhone Group Advisors, have a handful of registered reps and investment bankers to serve up their agenda of cornering the entrepreneur in their royal We “frat houses”. Hopefully the startups carry pepper spray, because Outside Business Activities (FINRA-required “OBAs”) are far from disclosed.
Robert Frank Agostinelli and Michael Steven Langman founded Rhone Group in 1996. Both men are registered securities reps and principals, with Michael Steven Langman having been an investment banking rep since 2010 and just recently becoming an investment banking principal 11 months ago. Rhone Capital LLC is listed as the general partner of Rhone Group’s private equity funds, and the SEC website lists 12 private funds and entities in its existence.
47-year-old Marsha Allison Steiner (“M.A. Steiner” in non-U.S.-disclosed international regulatory filings), an 11-year securities industry veteran, has been Rhone Group’s Chief Compliance Officer since late 2008. Ms. Steiner and Mr. Langman became investment banking reps the same day as each other in 2010 and both likewise became investment banking principals on the same day 11 months ago, 10/01/18.
Richard Bradley Sobel has been Rhone Group’s Financial Operations principal since 2004. He has been with 36 firms in 22 years. He is what is known in the securities industry as “Compliance in a Box”. The problem with Sobel being responsible for the current oversight of 7 FINRA member firms, including WeWork’s partners Rhone Group, is the obvious impossibility of maintaining compliance and operations on 7 distinct Broker Dealers, with hundreds of international subsidiaries and private funds.
Before continuing on with why all signs point to the $8.5B Rhone Group putting the investment banking moves onto all the We-s in We Co., a debriefing of the extreme dearth of investment bankers in the global Fertility space is in order.
Dresner Partners is a Chicago-based FINRA-registered middle market investment bank with a few large transcontinental Fertility investment banking deals under its belt. In early 2017, it was announced that Dresner Partners, through Steven Mark Dresner and Paul Elliott Hoffman, sold Dr. Richard Scott’s fertility empire, RMANJ to IVI in Spain. The approx. $400M deal created world Fertility leaders IVI-RMA and made the Chicago firm early to the Fertility investment banking space. In June 2018, newly licensed investment banking principal Mitchell Scott Stern, wrote that Dresner was “Representing a Midwest Fertility clinic group in its pending sale.” That clinic group could only have been The Fertility Centers of IL, and the deal has still not happened 15 months post announcement.
On a Feb 21st, 2019 Fertility Panel at a Healthcare PE conference in Chicago, Mitchell Stern answered a panel question by saying he is currently rolling up single International third party reproduction REs (incl. California). The healthcare investment banker specified a single MD practice in southern California that has many nurse practitioners, does huge international surrogacy business and uses many shared egg banks. The only IVF clinic in Southern California that fits this description is La Jolla IVF and Dr. David Smotrich. Likewise, 7 months post announcement, that deal still has not happened either. Stern said on the healthcare panel that IVI-RMA was the buyer client.
Three months ago, it was announced that Morgan Stanley Capital Partners bought Windrose Health Investors’ (formerly MTS Health Partners) majority stake in the Ovation Fertility clinic network. Ovation Fertility had just bought Center for Surrogate Parenting (CSP), the original Surrogacy agency, becoming the first Surrogacy agency to be sold to an investment bank. Since Windrose had bought Ovation from its $400M private equity fund, the deal was likely priced at a couple hundred million dollars.
Aside from the behemoth, Morgan Stanley, and the small Chicago investment bank, Dresner Partners, there is a void in the Fertility investment banking space. We Co. is currently publicly soliciting this opening. Counterparties to the healthcare deals include Spain’s Arcano Partners in the case of IVI. It was reported a few months ago that Jeffries could not find a buyer for Sagard Capital’s IntegraMed Fertility portfolio company. Sagard is owned by PowerCorp Canada, which announced hundreds of millions of dollars of losses in IntegraMed Fertility in its reporting through 03/31/19. Sagard Capital paid $170M to take the IVF clinic group private in 2012.
How many of WeWork / We Co.’s investors and potential investors know that We Co.’s NYC roomies Rhone Group are hot to trot as newly licensed investment banking principals? In the ultimate irony, Marsha Allison Steiner is the broker dealer’s operations principal and chief compliance officer, and has disclosed ZERO outside business activities to FINRA. How Rhone Group’s career operations principal and chief compliance officer can operate multi-international holding companies abroad and hide this from Rhone Group’s investors and the public amidst an S-1 registration (from which she is totally missing) – and roadshow to take We Co. public for a valuation of tens of billions of dollars – defies both logic and the law.
The bombshell non-disclosure in We Co.’s global M&A plans is the related party, Marsha Allison Steiner’s control of Albert UK Holdings 1 Limited. Albert UK Holdings 1 Limited has latched its hungry tentacles all over the globe.
Marsha Allison Steiner signs financial and legal documents as “M.A. Steiner” and signs as General Counsel, listing GC as her occupation. The ARDC website and FINRA disclosures do not identify Ms. Steiner as a lawyer for anyone or even as a lawyer at all. Ms. Steiner’s legal license is listed as very recently “Delinquent” on New York Legal Pro and “Suspended” on Avvo. Further perplexing is that FINRA requires registered reps to disclose all aliases, nicknames and abbreviations one goes by, but Marsha Allison Steiner lists only two of her six professional aliases to the investing public. The four she uses for her International holding companies, law licenses and legal daily life are missing from FINRA.
Franz-Ferdinand Alfons Maria Buerstedde, Rhone Capital’s managing director was a former director of Albert UK Holdings 1 Limited (Company number 09290767). Frans Petter David Johnsson is the only other active director of the UK Holding company, and holds five separate active appointments with Rhone Group, listed on the UK’s Companies House. Marsha Allison Steiner is responsible (on paper legal documents anyway) for Rhone Group’s UK Holding companies in the USA, KSA (Saudi Arabia), Egypt, Singapore, UAE, Abu Dhabi, Canada, Netherlands, France, UK, Spain, Denmark, Norway, Qatar, Bahrain, and wherever else Rhone Group has added “Intermediary Holding and Training Companies” since its UK Holding Company 2017 Annual Report. The UK has tried numerous times in the past 5 years to dissolve Rhone Group’s UK Holding company and cede it to the crown. Each time, Ms. Steiner, on behalf of Rhone Group, has successfully overturned the UK’s decision and kept Rhone Group’s far-reaching, international network of shell companies alive.
Disclosures in Albert UK Holdings are eerily similar to the flowery emotional disclosures in the We Co. S-1:
- “The company has taken advantage of the exemption from disclosing related party transactions with other companies that are wholly owned within the group.”
- “Since the company is an intermediate holding company, the Directors are of the opinion that there are no real objective key performance indicators that would be of use.”
Oh, how fun it would be to interview Ms. M.A. Steiner on international television about why FINRA disclosures DO matter, why international securities disclosures DO matter and why “real objective key performance indicators” are essential.
Bernie Madoff imploded by showing investors something that wasn’t really there. How different is that from not showing investors what is truly there?
It has been widely reported across international business press that WeWork has oodles of corporate governance problems. These are not mistakes that can be fixed by slapping a woman on the Board of Directors or giving Adam Neumann less voting powers. That is colloquially called “putting lipstick on a pig”. CNBC’s Jim Cramer is right – “They are just going to screw up the market…Let’s stop WeWork.” The Mad Money host’s Rule #1 is “Bull Make Money, Bears Make Money, Pigs Get Slaughtered.”.
We Co. is mocking Millennials – Millennials will rule the world, but not because of WeWork. There is a perception amongst WeWork’s principal soliciting investors, Rhone Group, that Asian money is like a free ATM. SoftBank’s Masayoshi Son just boosted his and VisionFund’s stake in the fledgling company above the $11B mark, increasing it by $2B. Saudi Arabia is the principal investor in VisionFund. This perception amongst startups and hot sector leaders that they just need to find a Spanish billionaire, an Asian billionaire, a Middle Eastern billionaire is going to change because international money is growing less gullible and will demand accountability going forward.
Regarding Adam Neumann, he is just an idealistic entrepreneur. Perhaps he has been taken by Rhone Group, We Co’s soliciting investors, as much as SoftBank CEO Masayoshi Son. The real sacrificial lambs being thrown out to slaughter by Steven Langman and Robert Frank Agostinelli are women such as Marsha Allison Steiner and We Co.’s unlicensed investment banking and capital raising solicitor, Jillian Canning. Ms. Steiner is a securities operations and compliance professional and general counsel and is in willful violation of securities industry non-disclosures to international investors’ tens of billions into her firm. Ms. Canning is simply non-licensed and probably does not know any better. It is up to Rhone Group to get Ms. Canning the investment licenses to solicit capital for them. They are FINRA regulated. But, again, the irony is that Ms. Steiner is the compliance officer, and she has not even disclosed her dozens of companies all over the globe.
No startup can own the world. Few are going to keep doing financial transactions with a conglomerate of companies and funds this flagrantly thumbing their noses at United States and international law and the markets. Strip away all the baby boomer and GenX appropriated millennial propaganda of We Co., and the truth comes out.