Home Brief Adam Neumann, the controversial co-founder of WeWork, is back with a bang

Adam Neumann, the controversial co-founder of WeWork, is back with a bang

The new startup of Adam Neumann, the controversial co-founder of WeWork, is making heads turned, especially for its mind-boggling valuation. The startup, named Flow, aims to rethink the housing rental market by creating a branded product with consistent service and community features.

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Adam Neumann new startup

The famous American investor and businessman Adam Neumann, who was in the news for bringing his co-founded company “WeWork” to the brink of collapse, has made a surprising return with another startup named “Flow”. The interesting part is that despite his demeaning reputation and proven accusation of misusing investors’ funds, he has already attained unicorn status, and that too before the launch which is expected to take place not before 2023.

Adam Neuman’s new startup

Flow, the new residential real estate startup has broken all records of the funding history to emerge as a unicorn much before its launch. Nearly three years before, Adam Neumann had to step down as the CEO of WeWork because he was alleged for failed IPO, toxic work culture, financial irregularities, and mismanagement. However, the 43-year-old has again successfully shocked the world with his strong move.

Bloomberg reports that a venture capital company, Andreessen Horowitz invested in Adam Neuman’s new startup for about $350 million. Combining all assets and cash, the company is valued at over $1 billion before its launch.

WeWork failed IPO

WeWork is among the most prominent real-estate companies, valued at around $43 billion at its peak. However, due to mismanagement, failed IPO attempt and Neumann leaving with millions of dollars, the market value crashed to $4 billion.

WeWork follows a plug-n-play managed office renting model. It takes a large space on rent for long-term, get it furnished and further re-rent it to other clients at much higher rates for a short period. However, companies operating from WeWork offices refrained from a long-term commitment, and this made it difficult for WeWork to justify its road-to-profitability to retail investors, resulting in failed IPO attempt followed by a tanked market value

Adam Neumann’s new startup works on a different model as the founder has already experienced the rise and fall of WeWork. He aims to team up with landlords for their property; Much similar to those branded hotel chains contracted and managed by landlords at their property.

With Flow, Neumann is trying to follow the social trend highlighting the fact that most Americans rent homes instead of buying due to housing shortages. “Nearly one-third of Americans currently rent their home while more than half of Americans living in urban settings are renters” MoneyControl

Indeed, Neumann has a robust plan that might transform the residential real estate market. That’s why Andreessen Horowitz, who has a proven history of being an early investor in some of the world’s largest companies, including Facebook and Airbnb, is showing great interest, support, and animatedly proof to Neumann’s critic, who always doubted his leadership and labeled him as a significant reason behind WeWork’s fall.

Flow released a roadmap on their website where they confirmed that the company is expected to commence its operations in 2023, and Marc Andreessen will join the team as a board member. The same report also explains Neumann’s plans about investing in the form of cash and real estate assets.

The New York Times claims that “Neumann has purchased more than 3,000 apartment units in Miami, Fort Lauderdale, Atlanta, and Nashville.

Through Flow, Adam Neumann aims to revolutionize the housing rental market by making a product that offers various community features with consistent service.

The exact details of the plan are still a mystery, but it’s confirmed that Neumann’s another startup called FlowCarbon, will be a separate entity albeit Andreesen being the investor in that startup as well. Neumann raised $70 million in May for FlowCarbon.

Andreesen, who will be added as a board member, shows his overwhelming support for the project. In a blog post, he said that the real estate market is ripe for disruption. More people are working from home and will experience lesser social interactions, bonding, or friendships as they had in office space.  He added details about the most significant renter’s concerns these days: “You can pay rent for decades and still own zero equity — nothing.” 

Flow aims to provide more security to tenants where founders believe that limited home ownership is the primary reason behind increasing anxiety and inequality. Providing secure and genuine ownership to society will surely help to bring the much-needed reforms.

The bottom line

Most people believe that Adam Neumann had done blunders and is gone for good. But the billionaire investor is again successful in surprising the world through his revolutionary ideas. Even the investors weren’t untouched by his charm and made his startup a unicorn before its launch.

Still, minimal details are available about the project, but trusted sources say it will be huge. Everyone is thrilled by the big numbers, but the project includes many other aspects of aspiration, vision, and ambition.

Only time can unfold the changes it brings to the world, but the project is exciting.

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