Marc Andreessen: “Only projects with such lofty goals have a chance at changing the world.”

Andreessen Horowitz, also known as “a16z,” and usually described as the storied venture capitalist firm from Silicon Valley, announced Monday its $350 million investment in Flow, a rental real estate startup founded by Adam Neumann, of WeWork fame. The investment, said to be the largest individual cheque Andreessen Horowitz has ever written in a round of funding to a company, valued Flow at $1 billion, even though it is expected to launch only in 2023. (Moneycontrol)

Flow

Adam Neumann has already bought up over 3,000 apartments in Miami; Fort Lauderdale, Florida; Atlanta; and Nashville, Tennessee. These real estate assets, as well as cash are expected to be his personal investment in Flow. The company will own and operate the properties as well as outsource its management expertise to other developments and parties.

Flow’s aim is to reinvent the rental housing market through branding, providing good services and the introduction of a community concept.

In a blog post announcing the investment, Marc Andreessen, GP at a16z described Flow’s mission as a “heavy lift.”

“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,” Andreessen wrote. “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.”

Adam Neumann

Andreessen brushed off Neumann’s checkered past, especially WeWork (NYSE: WE), a disastrous venture in commercial estate that ended with a failed IPO and Neumann’s ignominious exit, albeit with a billion dollar payoff.

“It’s often under appreciated that only one person has fundamentally redesigned the office experience and led a paradigm-changing global company in the process: Adam Neumann,” wrote Andreessen.

“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.”

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

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Image of Adam Neumann: Flickr