The five biggest global business meltdowns of the year
It was a year punctuated by business catastrophes as rising interest rates and soaring inflation roiled economies around the world. A banking crisis, investment downturn and no shortage of bad actors meant commercial meltdowns were in no short supply.
But some stood out well above the rest. Here are City A.M.’s biggest global business meltdowns of the year.
Elon Musk’s twitshow
Musk had already inflicted his fair share of pain on Twitter by the start of the year, but no one could have quite predicted the twitshow that was to come.
After wiping out one of the most recognisable brands in the world in favour of X, he then set about abusing and insulting the source of the firm’s core revenue stream and reigniting the fire he had hired Linda Yaccorino to put out. “Go f*ck yourselves,” Musk told his advertisers at New York Times’ Dealbook conference – it appears they now may just have chosen to f*ck off instead.
Wework’s office empire crumbles
Wework’s downfall had in some way already happened. Adam Neumann’s antics turned off the free beer taps and soured the party atmosphere at the once-feted ‘tech’ start-up, but rising interest rates and work-from-home switched off the lights on the way out.
Once valued at $47bn, Wework filed for bankruptcy in November with debts of $18.7bn. The business remains operational in the UK, but this year brought a close to the heyday of Wework once and for all.
Silicon Valley Bank
Silicon Valley Bank was a victim of its own dominance in a highly interwoven and easily frightenable industry in 2023.
Rocketing interest rates and an investment drop-off had already spooked the horses in the previous year, and the likes of Peter Thiel opened the stable door just as SVB began to wobble.
The start-up and venture bank’s bond portfolio tumbled in value as rates rose and it was hit by a flood of outflows from understandably scared start-ups and venture firms. Cash was pulled in a whirlwind few days in March, and SVB fell.
Credit Suisse
It was the year it all came to a head for the storied – and now defunct – Swiss stalwart. Jitters had been spreading around Credit Suisse for years after a string of scandals and catastrophic cases of mismanagement.
In March this year, consecutive quarters of losses and a flood of withdrawals forced the Swiss government to step in and negotiate a shotgun sale to its rival UBS. It brought the banking mini-crisis to a head and sent shockwaves across global economies.
Country Garden
Despite having a name fit for a small bistro in an English market town, this Chinese property giant plunged China’s domestic economy into a deeper crisis in 2023 and sent ripples across the world.
Country Garden’s troubles followed similar woes of Evergrande Group as it was hit by a series of credit rating downgrades and rocked by a liquidity crisis. The firm missed $15m in bond payments in October alone and sparked a wave of defaults in around $11bn of offshore funds.