Two weeks ago, Andreesen Horowitz, the largest venture capital firm in the world with US$30 billion assets under management, agreed to invest US$350 million in Flow — its largest single investment in a start-up ever. Andreesen, also known as A16z, boasts of funding companies like Meta Platforms (Facebook) and Airbnb at their start-up stage. Its investment instantly made Neumann’s new venture a unicorn, or a private VC-backed firm valued at more than US$1 billion.
Remember WeWork? The shared office start-up, once valued at US$47 billion ($65.5 billion), saw its public listing spectacularly collapse in late 2019 after attempting an IPO with a US$75 billion valuation. In April last year, just 18 months after the initial listing was abruptly pulled, WeWork merged with a blank-cheque special purpose acquisition company (Spac) at a more modest US$9 billion valuation. Even that merger turned out to be a gross overvaluation. The stock is down over 60% since then and WeWork now has a market value of just US$3.5 billion.
And what of the tall, fast-talking, charismatic, debonair, “bad boy” founder Adam Neumann? Well, he is back — with a new real estate venture. His new firm, Flow, is a branded property management firm for apartments. After the spectacular implosion of WeWork’s IPO, Neumann bought more than 3,000 units in Miami and Fort Lauderdale in Florida; Atlanta, Georgia; and Nashville, Tennessee for over US$325 million. Flow offers services for housing communities, fairly similar to what WeWork does for shared offices.
