The co-working billionaire has opened a branch of his Andreessen Horowitz-backed co-living startup Flow in Riyadh.
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Forbes Daily Briefing
WeWork Founder Adam Neumann Brings ‘Conscious Community’ Real Estate Startup To Saudi Arabia
Here's your Forbes Daily Briefing for Saturday, September 28th. Today on Forbes, WeWork founder Adam Newman brings conscious community real estate startup to Saudi Arabia. Adam Newman's real estate startup Flow has quietly opened its first properties in Riyadh, the capital of Saudi Arabia. It's the latest extension of the billionaire's bid to crack co-living and apartment rentals after we live, his previous attempt at real estate was canned after he stepped down as WeWork CEO. After buying over $1 billion of apartment blocks over America's Sunbelt and raising $350 million from Andreessen Horowitz, also known as A16Z, in 2022, Newman has outfitted Flow properties with co-working spaces, yoga classes, and hotel-style housekeeping services in an attempt to bring "community" to housing complexes. Flow Nargis "soft-launched" in August, peddling so-called "conscious community" and two- and three-bedroom apartments in a compound in the Anne Nargis area near Riyadh's airport. The furnished apartments start from $3,500 a month and showcase Flow's formula of bundling housing with services like laundry and housekeeping and amenities like pools, gyms, and bowling alleys. A YouTube video shot in August by one of the first residents of Flow Nargis shows a partially completed and largely deserted building. The compound with its 238 apartments was built by Saudi construction group Safa, and it appears that Flow retrofitted the building for international tastes by tearing down the walls that traditionally separate male and female areas of the gym in service of a more WeWork boho chic aesthetic. In a statement, Flow spokesperson Amy Stevens said, "Flow is designed for everyone. Design changes to the building are to align the building with our brand." Flow has three properties with close to 1,000 apartments in the Saudi capital, with construction slated to finish by the end of the year. Newman's startup had bought the properties in partnership with private local investors, according to Stevens. He added that Saudi's sovereign wealth fund, which backs A16Z, has not invested in Flow. Andresen Horowitz's decision to invest in Newman's Flow in August 2022 sparked confusion following WeWork's infamous implosion from a $47 billion valuation. Newman tried to mount a bid earlier this year to buy back WeWork after its share price cratered and it filed for bankruptcy protection, but his offer, which would have seen Flow acquire WeWork for $650 million, was rebuffed. Instead, real estate software group Yardi bought the bankrupt startup for just $450 million after striking a deal with WeWork's lenders. When Newman first announced Flow, its business model was something of a mystery. Flow's job listings touted a quote "ambitious vision for the future of living." While in Newman's speeches, it appeared to encompass a mess of ideas extending from crypto-enabled financial services to a nebulous plan for tenants to build equity with their rent. It also posited the idea of renters plunging their own toilets to build "ownership." The startup opened its first Flow branded properties in Fort Lauderdale and Miami, Florida, in April, with a more modest pitch focused around offering medium to long-term leases at condos with an eco-friendly veneer. Flow's new website touts its values as quote "commit, grow, love, and oneness." Newman appears to be exporting a similar concept to the kingdom, where he headlined the Sovereign Wealth Fund's annual Davos in the Desert Summit last year. Flow Nargis earlier this month posted a cacao ceremony combined with a dance class and yoga classes. Flow Riyadh posted on its Instagram account in August, quote "dive into an art class, nail that yoga pose or uncover the hidden gems in our beloved city with your new friends." The WeWork co-founder has a tangled history with Saudi Arabia and its Sovereign Wealth Fund, which has emerged as a major backer of both tech startups and investors over the last decade, but remains controversial because of the country's human rights record and the killing of journalist Jamal Khashoggshi. Softbank pumped more than $20 billion in equity and debt into Newman's WeWork, largely with money from the Middle Eastern Kingdom Sovereign Wealth Fund. It was one of the main backers of Softbank's Vision Fund, the world's largest VC fund. For full coverage, check out Ian Martin's piece on Forbes.com. This is Kieran Meadows from Forbes, thanks for tuning in. [BLANK_AUDIO]