It looks like a new residential real estate startup from controversial WeWork co-founder Adam Neumann is off to a promising start.
In a blog post earlier this week, venture capital firm Andreessen Horowitz announced plans to invest in Neumann’s new residential real estate company, Flow.
The larger-than-life Neumann infamously made headlines in 2019 when he left the shared co-working powerhouse WeWork amid a failed attempt to go public, major financial losses, and both erratic behaviour and questionable dealings on his part. The whole dramatic story was even the subject of an Apple TV miniseries starring Jared Leto and Anne Hathaway.
The embattled WeWork eventually went public through an SPAC in 2021 and continues to operate its remote workplaces -- including many across Canada.
Recognizing that not everything has exactly been a walk in the park for Neumann in terms of his business track record, Andreessen Horowitz acknowledged in the blog post that Neumann and the story of WeWork have been “exhaustively chronicled, analyzed, and fictionalized -- sometimes accurately.” However, the firm is unfazed.
“For all the energy put into covering the story, it’s often underappreciated that only one person has fundamentally redesigned the office experience and led a paradigm-changing global company in the process: Adam Neumann,” reads the post. “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. 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.”
Flow is expected to launch in 2023. While the details publicly available about Flow are scarce, a New York Times exclusive article said that Andreessen Horowitz invested about $350M into Flow. It also described Flow as “effectively a service that landlords can team up with for their properties, somewhat similar to the way an owner of a hotel might contract with a branded hotel chain to operate the property.”
The Andreessen Horowitz blog post highlights in detail the relentless housing crisis in the United States (something that is also clearly playing out in Canada as well), citing Flow as part of the solution.
“We think it is natural that for his first venture since WeWork, Adam returns to the theme of connecting people through transforming their physical spaces and building communities where people spend the most time: their homes,” reads the post. “Residential real estate -- the world’s largest asset class -- is ready for exactly this change."
Whether or not Flow can meaningfully impact the housing crisis south of the border in the way WeWork revolutionized office culture will remain to be seen. But here's to hoping lessons were indeed learned.
