Andreesen Horowitz invests $350 million in Adam Neumann’s new real estate startup Flow

Remember WeWork, the embattled co-working giant that lost billions of investors’ money after raising a staggering $12.8 billion in funding over 14 rounds? In 2019, WeWork fired its CEO Adam Neumann, canceled its IPO, and laid off a quarter of its 12,500 employees. But not so fast. Adam Neumann is back again with his new venture.

Nearly three years after Adam Neumann was let go from WeWork following a failed attempt to take the company public, he now once again trying to run another billion-dollar real estate startup. It’s like WeWork but for apartments. And high-profile investors already pouring millions of dollars into Neumann’s new startup.

Andreessen Horowitz, the prominent venture capital firm known for its early investments in Airbnb and Twitter, has reportedly pumped about $350 million into Neumann’s newest venture, called Flow, according to The New York Times, citing unnamed sources briefed on the deal. The funding valued the new startup at more than $1 billion, according to the report.

Flow is “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 New York Times reported.

In a blog post on Monday, Andreessen Horowitz cofounder and general partner Marc Andreessen also confirmed the investment, without disclosing financial details. Andreessen also explained his thinking for backing Flow, a residential real estate company, and Neumann despite the founder’s high-profile fall from grace at WeWork.

“Adam is a visionary leader who revolutionized the second largest asset class in the world — commercial real estate — by bringing community and brand to an industry in which neither existed before,” Andreessen said.

“Adam, and the story of WeWork, have been exhaustively chronicled, analyzed, and fictionalized — sometimes accurately. 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.”

It’s still unclear how Flow seeks to revolutionize the residential housing industry. The startup currently has a bare-bones website, with the slogan “Live life in flow” and two words stating it will launch in 2023.

Andreessen positioned the new company as a long-awaited solution to the nation’s “housing crisis.” He used a mix of jargon-filled terms — “community-driven, experience-centric service” — to explain how the new startup would “create a system where renters receive the benefits of owners.”

“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,” Andreessen wrote. “Residential real estate — the world’s largest asset class — is ready for exactly this change.”

Under Neumann’s leadership, WeWork expanded from shared coworking spaces with elaborate perks to experimenting with gyms, a school, and housing. The last of those efforts, called WeLive, let customers rent a bed or private room in a coliving location, with common spaces available for yoga, ping-pong, and more.

Since its founding in 2010, WeWork raised a staggering $12.8 billion in funding over 14 rounds. In 2019, the startup formally withdrew the S-1 filing and postponed its IPO.