WeWork is worth just a fraction of where it was raising money in private markets, according to a widely followed valuation expert.

Aswath Damodaran, professor of finance at the Stern School of Business at NYU, who is sometimes called the "dean of valuation," analyzed the start-up's prospectus filed in August. Based on that pre-IPO paperwork, he said WeWork's equity is worth $14 billion — about 70% below its latest private market valuation.

SoftBank's last investment in WeWork at a $47 billion valuation has been challenged as it heads towards an initial public offering. Sources told CNBC's David Faber last week that the valuation target for the real estate company was being cut by roughly $20 billion because of weak demand. CNBC reported this week that SoftBank, WeWork's biggest outside investor, was pushing to shelve the IPO.

WeWork, founded in 2010 by CEO Adam Neumann, rents out work spaces to start-ups and other businesses. According to its website, WeWork is "committed to elevating the collective consciousness of the world by expanding happiness and unleashing every human's superpowers."

One key reason for Damodaran's skepticism is WeWork's real estate liabilities. By Damodaran's estimates, the company has accumulated a $23.8 billion debt load, including lease commitments. That makes it vulnerable to economic downturns and shocks in the real estate market, he said.

"The hope is that as the company matures, and its leaseholds age, they will turn profitable, but this is a model built on a knife's edge that, by design, will be sensitive to the smallest economic perturbations," he said in a blog post.

Damodaran said even a $15 billion or $20 billion equity value "requires stretching the assumptions to breaking point" and that there are a "whole host of plausible scenarios where the equity is worth nothing."

"To the question of whether WeWork could be worth $40 billion, $50 billion or more, the answer is that it is possible but only if the company can deliver well-above average margins, while maintaining sky-high growth," he said.

WeWork declined to comment on the valuation or Damodaran's assessment of the company.