Silicon Valley woke up to what seemed like a joke: Controversial commercial real estate entrepreneur Adam Neumann received $350 million from a16z for a residential real estate startup, Flow. The WeWork founder has been the subject of serious criticism for gross mismanagement, a toxic work culture and shady antics, including buying the trademark “We” and selling it back to his company for $6 million. Under mounting pressure, Neumann stepped down as CEO of WeWork in 2019, but still owns 10% of the company. Now Neumann is back and in an a16z blog post, investor Marc Andreessen presented the potential to disrupt the housing rental market. This is what we know about Flow.
- This is reportedly the largest check ever from a16z. According to the New York Times, this is Andreessen Horowitz’s largest single-round investment, with the startup already valued at $1 billion. Critics are quick to point out that Andreessen’s concerns about the housing crisis seem insincere, as it was recently revealed that the investor opposed a proposal for new housing in his upscale neighborhood.
- Flow is already in the making. Neumann bought more than 3,000 apartments in Atlanta, Fort Lauderdale, Miami and Nashville, according to the Timeand will offer Flow’s branded rental housing experience and services to third-party developers.
- Flow wants to be a living utopia for home workers. Andreessen mentioned employees moving away from the personal office experience, with Flow providing a community life to accommodate the future workforce. It’s unclear whether Flow will offer a rent-to-own option to residents.
- Neumann tried residential real estate before and failed. Under his leadership, the WeLive brand launched co-living spaces in New York and Virginia. Plans to expand into India and Israel were quickly halted, and in 2019 WeLive became the subject of a New York City investigation.