Former WeWork CEO Adam Neumann wants to disrupt the rental market with Flow. And with funding from a16z, it is already said to be a unicorn.
Andreessen Horowitz has reportedly just signed its biggest individual cheque ever for the new venture of Adam Neumann, the controversial former CEO and co-founder of workspace provider WeWork.
After leaving WeWork in 2019 amid investor concerns over how the company was governed and its employees were treated, Neumann had been under the radar. This was until May, when he was revealed as the co-founder of crypto venture Flowcarbon, backed by Andreessen Horowitz in a $70m round.
Now that crypto markets are down, Neumann seems to have shifted his attention from the blockchain-based carbon credit platform to disrupting the rental real estate market.
His new venture Flow has secured $350m backing from Andreessen Horowitz, or a16z, according to The New York Times. This reportedly values Neumann’s latest venture at more than $1bn and makes it a unicorn even before it has begun operations.
Marc Andreessen, one of the founders of a16z, wrote about the investment in a blogpost without revealing any investment figures.
Andreessen discussed how the pandemic has upended the traditional housing market by changing the way people work and where they choose to live.
“In a world where limited access to home ownership continues to be a driving force behind inequality and anxiety, giving renters a sense of security, community and genuine ownership has transformative power for our society,” he wrote.
While not much has been revealed about the business model of Flow, the idea is to help renters feel a sense of community as they increasingly move away from locations close to their workplaces.
“As a result [of moving away], they will experience much less, if any, of the in-office social bonding and friendships that local workers enjoy,” Andreessen added. “This is not a good path for anyone and it needs to be addressed directly, right now.”
Flow is expected to open its doors in 2023. Neumann has reportedly purchased more than 3,000 apartment units across four US cities: Miami, Fort Lauderdale, Atlanta and Nashville. Flow will operate these units to create a branded product with consistent service and community features.
Andreessen is betting on Neumann’s entrepreneurial experience with WeWork to play a part in the success of Flow. “We understand how difficult it is to build something like this and we love seeing repeat founders build on past successes by growing from lessons learned,” he went on.
“For Adam, the successes and lessons are plenty and we are excited to go on this journey with him and his colleagues building the future of living.”
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