Flow (of bs)

Lessons have been learned, according to Marc Andreesen, co-founder of A16Z. This week he described Neumann as a “visionary leader” who had revolutionized commercial real estate“ - the Guardian.

Adam Neumann raised $350M from A16Z for a new company that will re-invent apartment living.  It aims to address the world’s housing crises with “community-driven” rentals. It also plans a crypto wallet.

I am just ending my lease at Regus on a one person office. The difference between WeWork and Regus (part of IWG) is the former has nicer spaces, free kombucha (AFAIK it still has), and hosts community events. Regus doesn’t. It’s more “corporate” and is cheaper. Both have the same business model. Long term lease or buy office space, carve it up into flexible spaces, and offer short term leases marked up to make a profit. Regus has been around since 1989. Did WeWork revolutionize commercial real estate? Nah.

Flow appears to be a WeWork replay aimed at renters. They appear to have bought 3000 units already. Even if Flow is something more, it will be a repeat of WeWork as there are no barriers to entry. Whatever Flow does can be copied.

Flow’s crypto wallet component should also be a warning sign. A16Z has invested massively in crypto, and the underlying reason seems to be that they can exit positions much earlier by dumping tokens on retail. Crypto is a casino and it’s heavily rigged to the house.

Maybe Neumann’s reality distortion field and a cryto wallet will revolutionize renting, but it won’t revolutionize Flow’s valuation in the long run. He and A16Z will do well though as the bag is passed to those gullible enough to invest in following rounds, or the retail investor.