The WeWork co-founder is a significant investor in Alfred, a residential real estate startup.
(Bloomberg) — When the news broke that Adam Neumann’s latest venture, a residential real estate company called Flow, had raised about $350 million from Andreessen Horowitz, the startup’s premise sounded similar to another company Neumann had been involved in: Alfred Club Inc.
Neumann invested in Alfred in 2020, about a year after his ouster as the chief executive officer of WeWork Inc., the co-working company he co-founded. Alfred offers technology and services to improve the experience of renters in apartment buildings—and though details on Neumann’s Flow are scarce, it’s also focused on residential real estate and renters.
That leaves the founders of Alfred, Marcela Sapone and Jessica Beck, in a tough spot. Their major investor, Neumann, is now running a potential rival. According to Forbes estimates, Neumann still owns about 10% of the company.
Sapone and Beck spoke for the first time since the news of Neumann’s company in an interview with Bloomberg Television on Wednesday. The co-founders declined to comment on Neumann’s decision to start a competitor, but said that Andreessen Horowitz’s funding was nevertheless a good signal for venture capital interest in residential real estate.
“Andreessen is a storied firm and fantastic investor, and we’re excited about the attention they’re bringing to the space,” Sapone said. Alfred has always been focused on residential as opposed to other types of real estate, she said. The company originally started as a service that added amenities to apartment buildings and has moved into providing the software to manage buildings.
Despite Neumann’s spotty track record with WeWork — he was wrapped up in self-dealing, lavish spending and eccentricities, and the company once privately valued at $47 billion now trades at around $3 billion — Andreessen Horowitz has been a vocal backer of his new project. Sapone said Wednesday that she believes investors can benefit from giving female founders their fair shot. “Female-led companies — the ideas are no smaller, and our ability to execute is not less,” she said. “I think there’s a huge arbitrage opportunity for backing female founders.”
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