Troubled co-working space giant WeWork has officially laid off 2,400 employees, while its chief executive has walked away with a $US1.7 billion “golden parachute”.

WeWork confirmed the mass lay-offs, which amount to about a fifth of the company’s total global workforce, late last week. WeWork has more than 500 locations in 29 countries, including in Australia, with about 12,500 employees globally.

It comes after a tumultuous few months for WeWork, with a failed IPO attempt leading to its value plummeting from $US47 billion to about $US8 billion.

After canning the IPO, the company had reportedly been on the verge of running out of cash before securing a $US9.5 billion rescue package from its largest investor, Japanese VC giant Softbank.

The lay-offs are part of a new strategy to “create a more efficient organisation”, a company spokesperson said.

“The process began weeks ago in regions around the world and continued this week in the US,” the WeWork spokesperson said.

“This workforce reduction affects approximately 2,400 employees globally, who will receive severance, continued benefits and other forms of assistance to aid in their career transition.

“These are incredibly talented professionals and we are grateful for their important roles they have played in building WeWork over the last decade.”

It comes as Softbank is set to launch a tender offer for up to $US3 billion-worth of WeWork shares, a major part of the rescue deal. This will include up to $US970 million in shares owned by former WeWork chief executive and figurehead Adam Neumann, who was forced to resign in late September over a series of concerns surrounding corporate governance, culture and financial losses.

Neumann was also handed a $US500 million personal credit loan by Softbank and an exit deal which involved $US185 million in consultancy fees over the next four years.

The large-scale sackings’ stark contrast with the treatment of Neumann was slammed by US Senator and presidential candidate Elizabeth Warren.

“WeWork is laying off 2,400 employees – while its founder walks away with a massive $1.7 billion golden parachute,” Warren tweeted.

“This is another example of a rigged and corrupt system.”

WeWork employees wrote to company executives in October asking for fair treatment during the upcoming layoffs.

“We are not the Adam Neumanns of this world - we are a diverse workforce with rents to pay, households to support and children to raise,” the letter said.

Softbank boss Masayoshi Son earlier this month revealed he believed there was a “simple formula” to fix WeWork’s woes, despite the firm taking a $US6.7 billion hit on its investment in the tech company.

Son did however admit he “made a mistake” on the WeWork investment and his judgement of Neumann.

“I won’t make any excuses – it was a very harsh lesson,” Son told investors earlier this month.

“I overestimated Adam’s good side.

“His negative side, in many cases, I turned a blind eye, especially when it comes to governance.

“There was a problem with my own judgement. That’s something I have to reflect on.”