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Adam Neumann raises $350 million to revolutionize the apartment market

Today it was announced that venture firm a16z has made a $350 million investment in Adam Neumann’s new residential rental company called Flow (which is kind of ironic).

The company is set to launch in 2023 and nobody on the outside seems to be entirely clear on how it plans to revolutionize the multi-family rental market, but supposedly this funding round values Flow at more than $1 billion and supposedly Neumann will be rolling in the 4,000 or so apartments that he has been buying up.

In any event, here’s how a16z described the opportunity (I think the key sentence is probably the one about creating a system where renters become like owners):

Only through a seismic shift in the way industry relationships are structured and the mechanisms through which value is delivered can we hope to address the underlying problems of the current system and build the solution. Doing this requires combining community-driven, experience-centric service with the latest technology in a way that has never been done before to create a system where renters receive the benefits of owners. This means rethinking the entire value chain, from the way buildings are purchased and owned to the way residents interact with their buildings to the way value is distributed among stakeholders. And given the fragmented nature of the ecosystem today, we can only hope to accomplish any of this by bringing every aspect of the living experience together.

What I will say is that I think it’s great to see this amount of innovation-focused money flowing into the residential real estate space, which is, after all, the biggest asset class in the world and one that could certainly use some fresh ideas. Apparently it’s also the biggest funding round that a16z has ever done.

But I also find a16z’s characterization of the problems a bit odd. Renting an apartment is described as this soulless and profoundly lonely experience where you’re so ashamed of where you live that you’re even hesitant to invite friends over. They also conflate house with home, as if to say that you can’t have the latter without the former.

On second thought, maybe these are exactly the right problems to be solving. It is our biases that we need to do something about.


  1. AM

    This is all fine and dandy, but their corporate drivel says nothing about how they plan on doing that. Until they clearly tell us how they will solve the problem, it’s vaporware. I wish them all the best of luck, but I also wouldn’t entrust Neumann with picking up my dog’s shit.


  2. Max Vo

    My guess is that it is going to be very similar to what Plazacorp has been doing with Key here in Toronto.

    Basically rent to own, but using technology to allow users to upgrade and downgrade units without large transaction costs… all while providing a steady stream of cashflow to investors.


  3. Pingback: A discussion about Adam Neumann’s new residential apartment startup — Flow – BRANDON DONNELLY

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