Adam Neumann, the co-founder and former CEO of the shared office startup WeWork, is working on a new rental real estate business that has received funding from Andreessen Horowitz. According to a report from The New York Timesthe venture capital firm invested around $350 million in Neumann’s up-and-coming real estate business, called Flow, which aims to provide a consistent housing experience across a chain of branded apartment complexes.
If you’re at all familiar with the story of WeWork, you might be having a bit of deja vu. The company, which provides flexible office spaces for workers, was once valued at $50 billion. But after a failed IPO (initial public offering) and the layoffs of thousands of its workers, WeWork became more well known for corporate drama rather than its actual business. When Neumann stepped down as CEO in 2019, he made out with a $1.7 billion exit package.
As noted by the Times, this investment marks the “largest individual check Andreessen Horowitz has ever written in a round of funding to a company.” It puts Flow’s valuation at over $1 billion — despite critics “who have described his leadership of WeWork as a cautionary tale of corporate hubris” — and it hasn’t even launched yet.
Neumann has already bought 3,000 apartment units in Miami, Fort Lauderdale, Atlanta, and Nashville to build out his Flow-branded apartments, which aren’t set to debut until 2023.
“We think it is natural that for his first venture since WeWork, Adam [Neumann] returns to the theme of connecting people through transforming their physical spaces and building communities where people spend the most time: their homes,” Andreessen Horowitz co-founder Marc Andreessen explains in a blog post. “Residential real estate — the world’s largest asset class — is ready for exactly this change.”