WeWork co-founder Adam Neumann scored a major investment in his latest venture that wants to transform the apartment industry in the same manner he did with office real estate.
Venture capital firm Andreessen Horowitz, known for its early investments in Facebook, the ride-sharing company Lyft and others, invested $350 million in Neumann’s new company called Flow, according to the New York Times. Flow is not yet in operation, and its website says “coming 2023.”
Flow may be the result of Neumann quietly building up ownership of U.S. apartments for more than a year, including properties in Atlanta, Georgia; Nashville, Tennessee; and South Florida. He also invested in Alfred, an apartment management software company, which bought Charlotte, North Carolina-based property management firm RKW Residential earlier this year.
Flow aims to address the remote- and hybrid-work phenomenon that exploded because of the pandemic and end the “soulless experience” of apartment living, according to a blog post on Andreessen Horowitz’s site by Marc Andreessen, the firm’s co-founder.
Andreessen noted that workers now can move away from the traditional economic hubs to different cities and into rural areas without harming their own economic opportunities.
“As a result, they will experience much less, if any, of the in-office social bonding and friendships that local workers enjoy,” Andreessen said. “For many of these people, increased screentime and reduced in-person interaction will cause challenges that are not just limited to work, such as alienation and loneliness. This is not a good path for anyone and it needs to be addressed directly, right now.”
Andreessen called Neumann a “visionary leader” who can reshape the apartment industry much the same way he did with offices.
Neumann was ousted as CEO of WeWork in 2019. The company founded in 2010 was headed toward an initial public offering with a valuation of $47 billion, but it all fell apart after regulatory filings raised questions about WeWork's financial prospects and management.
SoftBank, WeWork’s largest investor that championed Neumann’s vision of “change the world,” gave him a $1.7 billion payout to leave.
WeWork eventually went public last year through a special purpose acquisition company after new management made numerous changes, including shutting down locations and renegotiating leases on others.
"We love seeing repeat-founders build on past successes by growing from lessons learned," Andreessen said in his blog post.
Representatives for Flow did not immediately respond to a request for comment from CoStar News sent through its website.