WeWork founder Adam Neumann has revealed more detail about his new startup Flow, canvassing the potential for future tenants to gain some sort of equity stake as part of their tenancy experience.
Footage of Neumann discussing Flow with financial backers Marc Andreessen and David Ulevitch of A16Z in November was released on YouTube this week.
A16Z is Flow’s main financial backer, having invested US$350 million into the project.
During the conversation, Neumann outlines the ‘four pillars’ of Flow, which consist of a property management company to manage day-to-day operations; a real-estate management company that holds the asset and a financial services company.
The fourth pillar will be a “mechanism that’s going to take some of the value and share it with the value creators” Neumann says, though he didn’t provide any additional detail.
It’s understood that this equity stake would not involve any ownership of the apartment building itself, but it’s previously been speculated that this value-sharing mechanism could be in the form of a cryptocurrency offering.
Bloomberg has previously reported that Flow’s financial services arm will offer a cryptocurrency wallet.
The video doesn’t give a full picture of what Flow will look like, though it is apparent that Neumann is keen to establish a sense of ownership among tenants.
This would lead to tenants staying longer in their apartments, which would lead to greater profitability.
He used the analogy of when a tenant would use a toilet plunger to get the point across.
“If you’re in an apartment building and you’re a renter and your toilet gets clogged, you call the super,” Bloomberg reported him saying.
“If you’re in your own apartment, and you bought it and you own it and your toilet gets clogged, you take the plunger.”
That was what happens when you feel “like you own something”, he said.
It’s understood that Neumann has already established an investment trust that holds around 3000 units in Atlanta, Miami, Nashville, and other cities, and that Flow will offer these properties for rent.