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Disrupting the World's Largest Asset Class with Adam Neumann — vídeo y transcripción

www.youtube.com 2026-04-19 Ver fuente

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and I just want you to know that it's part of the game to get punched and the question is not are you gonna get back in the game the question is is when back in August after a6c announced our investment into Adam Newman's new company flow it felt like almost everyone whether it was other VCS Founders or journalists had something to say but the one person you didn't hear from was Adam himself and this never shared before footage from our American dynamism Summit back in November Adam sits down with a16c co-founder Mark Andreessen and a 16c venture General partner David ulovich they start by discussing why Adam's chosen to step back into the arena but also why flow that leads into the inevitable conversation around how the pandemic fundamentally shifted both work and home as they touch on a16z's move to the cloud cities as startups and ultimately what it might take to disrupt the world's largest asset class we also get an insights group into how Adam is thinking about the four pillars of flow from technology to financial services finally this video was recently published alongside our full live library of American dynamism Summit recordings which you can find at a16c.com ad-summit [Music] [Music] thank you gentlemen for being here I'm going to just jump right into it those of you that have uh heard Adam and Mark speak know that they have a lot to say and they're very smart so we aren't going to waste any time Adam three years ago you stepped down from your role as CEO of wework one of the most well-known real estate companies ever created you could have sailed off into the sunset a lot of Founders do that hang out in the Mediterranean uh but you decided to start another company again you're not naive you know it's hard you know that there's a lot of attention on you uh so how did you decide that you wanted to Chase and build a new impactful company and uh chase a big vision and dedicate your time to building why why get back in the game get back in the arena first of all thank you for having me thank you Mark thank you David I apologize about the sandals I broke my toe I'm supposed to wear different shoes you know when I stepped down three years ago [Music] the first thing I actually did was I took a moment and I just wanted to take a second and think of the successes but also think of the mistakes and the lessons and all the different things that that I did and that we did as a team and even though I was very proud of what we built I really felt like there was a lot of thinking to do and that was sort of my first thing as that was happening I started building a family office and with my family office we invested in about 50 Venture Investments we did private Equity Investments we did liquid market trading and each one of those things taught me something new that I wasn't aware of before liquid markets actually taught me about Wall Street and as I was sitting with the team and we were doing different investing and listening to earning calls I was like oh wow that's what you guys are listening to and that's what's interesting for you and that gave me a perspective that I didn't have before when I was sitting with entrepreneurs as we did our Venture investing the first part when you invest and write the check is a lot of fun but then comes the part where you're talking to them and listening and they have problems and I got to give advice to these entrepreneurs and they didn't always listen and I was like okay that's how it feels when an entrepreneur is on the list I was like okay I got that and that taught me a lot and actually made me understand Mark and Ben and Venture Capital more and as we're doing all of this and this is now where covet is happening this is March 2020 we were looking at real estate because it's something we care about and we just felt that there was going to be an opportunity in multi-family it was a simple trade it was cap rates were at four eight and we thought they were going to compress and we saw interest rates and we thought there was an opportunity so we decided to go as a as a family office very deep into multi-family we bought approximately 4 000 Apartments and as we're doing that I started walking these buildings and even though initially it was a trade I started feeling like there was something more that can be done I started feeling like the residential experience is not what it should be and just to backtrack this a little bit so going backwards again to 2019 we're stepping down and now it's early 2020 as the whole thing is happening and maybe you wouldn't be surprised but the phone is not ringing as much as it used to be just a few months before I got a phone call from Mark and we never met and Mark introduces himself hello I'm Mark Andrews and I said I know you are mark thank you so much for calling me and he sort of we're having discussion we're talking about something but very quickly turned to Mark asked can we saw Adam how are you doing and I told him this and that and this and that and he says to me oh you're still in that stage and I look I was like this was on the phone I said the mark what stage is that and he goes the stage where you believe everything the media says and I said that well I'm not in that stage and I know we built a great company and of course I don't believe but you know they are saying quite a lot of things and Mark says to me Adam we don't know each other but let me tell you something about venture capital and high growth companies and the bigger the Venture the bigger the growth what I'm about to tell you is more true it's hand-to-hand combat anybody who doesn't know that Ventures hand-to-hand combat doesn't actually understand or has never done it before and when you fight once in a while you get punched and he said I guarantee you because he was very nice he said a lot of our companies use your products not just in the US but all over the world instead I guarantee you that for every mistake you made there's a hundred things that you did right and I just want you to know that it's part of the game to get punched and the question is not are you gonna get back in the game the question is is when and just so you know you have a friend here that you've never met before but we've been tracking even if you ever decide to do anything then then call US and now fast forward well I'll say one more thing about it because it was very meaningful I hung up the phone and I still remember this I walked to Rebecca my wife and I was like I just had the most amazing phone call this guy Martin treason and explained to her who Marcus called me and basically was very encouraging and gave me a different perspective to look at what just occurred and she thought it was amazing and I thought it was amazing and Mark I don't know if I've ever had the chance to actually tell you it was a meaningful moment for me and I really appreciate it and fast forward now a year and a half we kept these buildings that we bought ended up being a really good trade and everything that we thought was happening was happening and we started building this brand it didn't have a name yet but we started building this business and we saw all this opportunity which we'll talk about a little bit later and around February we spoke again and Mark asked me what's up and I told him what was happening and that we've been developing in the business by this point this is over a year old and we've been doing more and more and we started Building Technology and we bought a company and we did a few different things and Mark said that when you come and present it to the team and we went and we met the team and the first thing I noticed when we all met is that the Andreessen Horwitz team was not like the venture capitalist that I was used to and I had quite a lot of experience with Venture Capital before and it didn't feel like investors it actually felt like businessmen like entrepreneurs and I actually asked I just asked mark behind stage I said how many partners do you have that are entrepreneurs and he said 20.
and I gotta tell you that's very different from other businesses and as as we're having the discussion one of Mark's Partners asked me Adam are you raising money and I said I'm not sure we're going to build this one on our own I'm not sure because one of our lessons was you got to choose your partners really carefully he said well maybe you should consider us let us look into the business and see if it's interesting and if so maybe we should consider us and then Digi led a very rigorous diligence process and they asked us a lot of questions and learned everything about our business and as we were getting to know Andresen I realized that these are the kind of partners that I was always looking for but never really knew that existed so to answer your question I was always building it but building it with a partner was something that only happened because of this demon because of the way I met them and I could just tell you that we had our first board meeting and one minute afterwards Mark called me and said Adam can I give you some feedback I said of course Mark he said well when your team said this and this and this I don't agree with that let me tell you why and here's the experience I have and here's what I want to warn you from so I welcome the feedback I'm so excited to be a partner I'm excited to be back in the game not alone but with the team and we're just getting started but the future is there's a lot of potential that's that's awesome and I will say on there's a whole bunch of venture capitals in the room and we are all very happy that we work exists so that our portfolio company is not signing these long-term leases in this Dynamic world that we live in and they get to go into the offices they want to be in in the right cities at the right time so what we're going to talk more about flow in the new business in a moment Mark I want to shift to you you know you and I have talked about housing for a long time long long before this investment something you've thought about for a long time why is housing important why is it particularly relevant why is it even part of American dynamism yeah so there's a critique of Silicon Valley in the tech industry that you know on various sometimes I agree with sometimes I don't but um you know there's a critique that basically says look you guys have done a great job you know silicon Valley's done a great job over the years like the really like unimportant things um and so like you know um you know you've consumed electronics and video games and media and e-commerce and like it's all great it's all fine it's all good and by the way like we do those things we're very proud of our efforts in those spaces and we actually think we actually think they're very important but you know they're basically they're small slices of GDP um and then if you look at basically the GDP pie chart which is also the you know sort of consumer spending pie chart the the things that people spend money on that really matter in their lives there's basically three really big ones uh right Healthcare education and housing um and if you look at kind of all the economic statistics by sector Healthcare education housing are basically increasing uh you know in terms of cost you know at a much faster rate than than all the others um and there are the sectors where the the tech industry has had the least impact historically and you know and of those the biggest one is housing right it's sort of the housing is the single biggest uh you know kind of thing that most families spend money on um and so you know it's really Central you know for from from that standpoint um you know it's very Central from a from a from an economic standpoint in the life of a family because right there's this you know very big question which is you know if you you know if if you own there are you know potentially big downsides because you might be stuck you know in one place where maybe you don't want your family to be for the next 30 years because maybe opportunity shifts around um you know but if you rent you don't necessarily write build up Equity by default you know with the way that most uh most uh most apartment offerings work um so they're you know so there's big economic consequences there's also big social consequences and political consequences right which is um you know and this is something that's kind of been deep in the American character for you know for for many decades but this idea that if you basically if you if you have a sense of commitment if you have a sense that you are actually invested in the place where you live you were more connected to the society you're more connected to the culture and then ultimately you're more you know you're more connected to the politics you know to the politics of the to the political uh to the political body um and so you know there's been long-running policies in in you know the United States to encourage homeownership now it turns out those could be overdone they can end up with problems and we saw a lot of the problems that kind of you know came out of that approach and you know kind of the historical approach in the in the 2008 financial crisis but nevertheless there is like a very kind of big deep meaningful you know kind of sense of identity that comes with uh comes with housing um why does this matter uh you know kind of from a from a broad standpoint um so the reason I think this matters so much is because uh geography is so um uh Central to economic opportunities so right so so basically take a step back uh the role of cities right in human society so like cities are a human invention you know if there were many hundreds of thousands millions of years where you know people you know people were running around without you know in clients and tribes uh not forming into cities then about 4 000 years ago cities were basically invented and and people started to Cluster uh that way um why were cities invented a bunch of reasons but one of the big ones is there's there's economic payoff to being in a city and the way that it works is if you are you know if you have a certain level of productivity and you're in a rural environment you don't have many opportunities to work with other people right who are highly productive if you move to a city all of a sudden you're surrounded by lots of other people who are highly productive and all of a sudden there's a catalytic effect basically this this this positive feedback loop that forms where kind of everybody becomes more productive and so basically it's the these cities are basically the foundation of modern economic growth economists call this the agglomeration effect which is basically if you like slam people together you you know sort of uh you know you can get a lot of good things out of that um you know the the the the the West developed you know we the the story of the West is the story of cities and the creation of all these the you know these these amazing cities um and then you know over the last 50 years you know that that kind of trend has gone into hyperdrive and you've had this emergence of what economists call Superstar cities where you've got these specific cities like Washington DC New York City Boston San Francisco Bay Area Los Angeles you know um and then you know internationally London and Tokyo and Singapore and so forth and Paris there are kind of these cities that are like irresistible draws for people who are you know highly ambitious and want to be around a lot of other highly ambitious highly productive people it turns out as a result of that Superstar City clustering thing there's been a bifurcation in the housing market right where basically those Superstar cities they become you know basically occupied at some point you know people end up with a political agenda and then they stop building housing right and so the places where people want to go and want their kids to go are very difficult to get to in the San Francisco Bay area is like a you know a classic example this you know San Francisco last year like authorized I think 6 000 new housing units right which it was just like an absurdly low number relative to the the demand for people who want to move there um and then the places where that do not have this kind of clustering agglomeration Superstar City effect you know they build plenty of housing but there's not there's not as much opportunity there so so heading into covid you just you saw this incredible bifurcation and you saw the American economy and you see it in American politics where basically you're either in a city you buy a home you know you've kind of got got you've got the whole commitment you've got that level of opportunity for you and your family right or you're in a more rural environment and you're basically stuck and you don't have access to good jobs and your kids are not going to have like high-tech jobs and it's you know basically it's you're going to have a lower quality of life um this was becoming a very big issue this become a very big issue by the way for for us because we were kind of we were basically getting stuck in the geographic confines of Silicon Valley like we were our companies were like penned in and it was becoming very hard for companies to grow in that area and then basically you know a horrible tragedy struck that turned out to also be in some ways a miracle in terms of I think the long run consequences which is coven right and you know none of us would have hoped that covet would have would have happened and it has been a horrible tragedy for for many people and I think you know broadly for our society but nevertheless covid was a System Shock right that caused all big companies to basically instantly Move online and a hard cut over you know in kind of a way that I never imagined was possible um it was also an instant proof that companies really can run at least for some time they can actually run uh online right basically like no big company actually stopped operating as a consequence of this dramatic shift from from in person uh to online um and then all of a sudden like that opened the door to you know every CEO every manager every entrepreneur every investor thinking oh um okay the post-covered world is not going to be like the free coveted world the post-covered world is going to be an opportunity to rethink and reinvent how companies are organized it's going to be an opportunity to reinvent how Industries are organized it's going to be an opportunity to reinvent you know how geography works right what the role of cities is it's going to be an opportunity to spread the economic activity from cities much more broadly you know potentially throughout the country um you know every employer every company every CEO here you know is is having some version of this conversation you know with their own company we talk about this with our Founders all the time um and then there's the corresponding question that's opened up which is how are people going to live um and some people are going to continue living the way that they were and some people are going to undertake a radical change in how they live and they're gonna you know they're gonna go they'll go remote and all of a sudden you know you go remote and you have access to you know thousands of jobs anytime you want which is a totally new phenomenon um and then there you now have the opportunity to rethink how how families live right and so you know is it necessary for ambitious kids to leave a place where they grew up in order to have access to first-class Economic Opportunity in 2019 he asked her that was frequently yes today maybe not um and so and and I should also say like it there's no like this is not a zero or 100 thing this is not like a hard cut over it's not like the whole world goes remote or stays remote right which is not what's happening but there's this moment in time that we're in right now which is like we can actually we can rethink and reinvent how companies are organized um and how work happens and then we can also reinvent how people how people live and give people a lot more options and how that happens um and so I I think basically the presumptions that have underlied the whole structure of how the housing market works and how the industry works and how people live and work I think it's basically all it for grabs I think we have about a five-year window I think as a society to kind of figure out what this means and how to adapt um yeah let me pause there that was awesome um perfect answer which is a good it's a good segue to where I want to go into which is uh we we have seen work become more Dynamic people now sometimes go into an office some days a week sometimes they go in for a couple months and they go to a different office a different city um you know like we work with quite equipped for this kind of dynamic work lifestyle what are the lessons that you have learned from wework that you're going to apply to flow or things that maybe you didn't you didn't do it we worked but you thought about that you're going to apply to flow particularly around sort of this changing way people live and work and how people as we get to rethink the way that we sort of organize ourselves and and bring ourselves to to work into home so I think you're right I actually think flexible work is more relevant today than 10 years ago so I actually think it's a better idea today than it was the obvious lesson is community I think Corona I think on top of everything that Mark just said and I'm not going to repeat any of it but but that's the data that pushed us into being as interested as we were in this category but on top of all of that we for a lot of time I think a lot of people argued Howard Schultz used to say Starbucks is the third place I remember once having an argument with him I told him we work as the third place it was like Starbucks is the third place well I think the first place turned out to be the third place I think the home is the most important thing I think covert taught us that I think you can take your your work into your home but you can take your home into your work and that's affecting a lot of change also to put the little numbers behind what Mark is saying 70 of 35 year olds and youngers are currently renters they don't actually buy and this number is not because of the interest rates that have been going up over the past six to ten months this is a number from 12 months ago and we believe that that number is actually only gonna grow so 70 percent are renters you said it's a big piece of their spend it's about a third of their total wallet so you have this huge asset class largest in the world 70 of its users are renters it's a third of their spend and yet they're not getting an experience that is actually up to par not to talk about the financial you mentioned mark that they're not creating an equity and they're not creating any equity and when you put those two things together you see a real Challenge and what it's going to do and we're already saying it people are starting to work where they live and not just live where they work and therefore you're starting to see these movements between cities and you can even say without becoming too political but we're in the heart of politics maybe some of the results in midterms now showed Democrats that were actually traveling to new cities and moving to different places a lot of things are shifting and the way we live has an opportunity right now to change because I think if we weren't clear about it before how important the home is everybody is reminded and a great home and a great experience an elevated experience is more important than ever before and then work has talked accommodate and Mark and I actually think see the world a little differently about what if our is every company going to be a remote company or in-person company but the answer is obviously hybrid of the two and as you think through well harm I'm going to solve work and how am I going to solve the future of way people live what I see is an opportunity to really affect that change and it's exciting that we're in DC because this is one of the places where opportunities like this become a reality if I could put you put put a put a point on something that Adam said so the you know there's sort of this there's Richard Florida uh to analyzes these things talks about he calls the creative class it's kind of you know the sort of say upper middle class you know it's it's us it's our kids right um uh it's it's sort of you know Highly Educated you know kids who are going to basically go into a knowledge or create a profession of some kind right work work work at a keyboard as opposed to you know with their doing doing some form of manual labor manufacturing and of course you know this is not most of the economy but this is sort of the you know kind of the upper middle class um you know in many ways the cultural Vanguard for the you know for the country you know they Define a lot of the trends and so there's this experience right that I'm sure a lot of us have had and a lot of a lot of a lot of younger people we know have had in the last especially 20 years you know really really 20 25 years the sort of thing where you you know you're growing up at home you you then go to college you you spend your time at College you know for or more years um and you know you're on this campus environment and it's you know and everybody knows like college is kind of education it's kind of adult they care um you know um you know it's got all the it's gotten all the food and entertainment it's got this whole contained environment it's a social environment it's a dating environment right it's kind of this this whole thing um you know you're putatively you're an adult but you're living in a dorm and there's like a older adult down the hall who's taking care of you right so you're not really fully an adult um and so you're in that environment and of course you know in you know 50 years ago you'd leave that environment and you'd you know go to work in an office you'd buy a you know you'd buy a starter house and you'd be on your you know sort of traditional American middle class path over the last 20 25 years it became very common to have this idea of the corporate campus right and and you know sort of Google maybe you know really kind of you know crystallized that in the in the culture um you know basically this idea that the company's facility where everybody came every day was going to basically be a continuation of the college campus experience um and and that led to kind of this you know perk Bonanza right so you'd have this whole thing go to his campus and it's like gourmet food 24 hours a day and it's like they'll do your dry cleaning and they'll walk your dog and there's you know swimming pools and there's the thing you know by the way you know these campuses still exists they're all 100 converting all their tennis courts to pickleball courts because of course that's what everybody's doing right so so there are these you know it basically a self-contained environment and the theory of it right was if we can get people you know especially these young people like inculcate them keep them in this kind of college campus kind of environment then they'll basically they'll work more right we'll get more out of them because they'll they'll be here more often um you know it's basically everything up to not usually including the actual bed um although sometimes people would sleep under their desk um like like Elon Musk um but everything you know sort of short of that um and so as a consequence you'd have this thing where sort of young adults kind of stayed in this corporate campus environment and then as a consequence they had this incredible Community right they had this incredible environment right where they have you know all these friends co-workers colleagues you know their you know their teammates other people who work at the same company they're going to lunch going to dinner doing the whole thing and then and then by the way it also turns out it's that it's it's just like the college campus it's the dating pool um right um and so you know it's you know basically if you work for you know for the Google campus or the Facebook campus like where you're gonna date probably somebody who also is there because you're there all the time together and then you basically like Drop covet into that model and you just like detonate it right which is which which is what's happened right and then all of a sudden the experience of a kid going through that all of a sudden it's like nope nope you don't get that what you get is you get to sit in your studio apartment right in front of your laptop right and good luck right and you're like cut off from everything else and like you've got doordash but and you've got Tinder and like that's your life and like that is not the same thing um and so and then you know to Adam's Point like a lot of these companies now are thinking okay we're gonna have people come back in the office two days a week three days a week and we're gonna have them come back and chance or this or that but you know this the spirit is like Elvis has left the building for the for these kinds of environments like this is not the way that most companies are going to operate um and so all of a sudden the focus on where you live the focus on what you know are you literally by yourself you know do you have roommates are you in a small you know complex are you in a big complex do you do you have any sense of connection whatsoever do you know who your neighbors are you know most people historically live in apartments I don't think they generally would even know who their neighbors are right the guy next door is just the guy next door you you'd feel no connection um by the way there would be no overlap where you lived and the people you worked with would have no overlap right because there was no point you didn't worry about whether there were other people who you worked with who were in your same apartment complex because you were seeing them at work all day and so do you have anything in common with the people you're in the building with um and so so there's this there's this sort of whole model that an entire generation grew up with that has all of a sudden been detonated and I I yeah and I I don't know it may be political I think the idea of sitting in the apartment in front of the screen with doordash and Tinder is not a good life um and so that that opens the door for reinvention we don't we don't think we know it's not a good life because we've even in the office so you gave Google as an example Google was inspiration for us that we work our point was well why can't small businesses have this great campus have this great energy and that was the beginning I remember when we tried to sell Google but like can we we could take some of your stuff they're like you can't take our stuff we're Google we invented this we ended up taking some of their stuff and quite a lot actually but um they they that same Serendipity feeling that you feel when you go when you were to go in an office and connect to this belongs in a home in a funny way way more than it ever belonged in an office and when you think of these apartment buildings and it is a little sad it's sad that there's an apartment building with 400 apartments maybe six seven hundred people with a swimming pool and a kitchen and a gym and all these amenities did when you if anybody here has ever been in a multi-family you do this amazing tour they show you all these amenity spaces you never see anyone there you then move into the building and you not everyone but a lot of people live their life that Mark is describing and that's sad because I don't think human connection thrives I actually think I'm so happy we're here face to face and covet was obviously a horrible thing but also a miracle at the same time it's a miracle that we're all here face to face because this connection is so much more meaningful and why doesn't why don't people deserve that in the home and again I go back to that number it's a third of their wallet spent as the Americans were used to actually for anything we spend if it's two percent of our world spend one percent of our wallet spend many companies that you guys invest in it's all branded it's always an uplifting experience if someone doesn't do good enough experience then the next person comes and elevates it and yet in residential and we can talk about why but in residential never happened and because it never happened and because it's so difficult to disrupt it actually didn't occur and what ends up happening is that renter is not getting a good deal neither the experience or the financial transaction and again that renter is the majority of the young adults yeah I think covid was the first time a lot of people especially under the age of of 40 50 first time they ever got to know their neighbors or they never had to and they're they're proxy for Community probably was the workplace and like you said we're never going back to that whatever our new normal is it's not I'm just going to give you a thought about that it's an American thing that they never had to like in other countries where I grew up in Israel there's no such thing you don't know your numbers when you don't have sold you go to your neighbor's door you knock on the door they don't answer you open the door it's locked you know where the key you open it up you go and you take the self you never break it back yeah then they go back there's no Soto Adam took it and and it's it's it's this it's this community here we call the police yeah yeah yeah they come in four hours it's true or San Francisco maybe never yeah yeah you guys said they said that I didn't say anything okay yeah but the point is that's it's such a natural thing for people living together to connect and yet we live in a world where even when people are in the same building they don't talk to each other in the elevator when I came to the United States and used to say hello to everyone in the elevator people thought I was weird yeah and I thought it was weird that you wouldn't say hello wouldn't you want to know who's living there and you know we have a lot a lot of little things and we we haven't talked about really flow yet there's a lot of different ideas that we have but the simple one is when people tour a building always the the tour the leasing agent tells you about all the amenities I would like the listing agent who's not even going to be called the listing agent to introduce you to a few residents who actually like living there let them tell you why this is a great building and if it's a fit for you or not a fit for you and that tiny little thing I just said is so small and the fact that it doesn't exist actually and a lot of people ask me Adam how come this didn't exist before it doesn't exist in my opinion because buildings are full anyway there's a short of supplies we spoke a little bit about zoning there's the numbers varies but between three to five million apartments and single family homes missing right now in the US and that number Grows by hundreds of thousands of units a year and so there's a shortage of Supply there's an over demand and no one really needed to do it and because the landlords didn't need to do it it didn't happen and when you think of prop their companies and Technology I was talking to Steve case before for a second about proptech and I'm a little bit about about all the different Innovations when when you think well why haven't people solved this problem before most popular companies come in and sort of solve a point solution they have this one solution but then they need to take that solution convince the landlords we're not even interested in buying anything because they're making money anyway go to these old Erp systems connect to the back of these systems then get the users it's very difficult which is why the way we want to tackle it is actually vertical I almost think it's the only way excellent the uh we're gonna come back to that in the vertical software stock for prop Tech and flow in a minute um Mark you know we we came out Ben had a big blog post about how we've moved our headquarters to the cloud we have decoupled uh the geography of the firm um so I guess the first question is like two parts talk a little bit about the thinking about moving to the cloud why did we do it and then talk about how it's gone yeah and then I'll keep you honest if I agree yeah so this is yeah this has been very dramatic I mean look for for every employer every company this has been dramatic we've had our version of it um and for us it's been very dramatic which is we we made a very deliberate decision when we started our firm in 2009 that we were really deeply going to invest uh in the office and in particular in one office and so we were kind of semi-notorious in the industry for we only ever had one office the office was in Menlo Park California um you know this is actually controversial even in the Bay Area because there are lots of startups are actually in San Francisco lots of the younger people who worked for us lived up in San Francisco and we said you know it's our you know and everybody every year was like we got to put up an office in San Francisco and we're like nope single office everybody's gonna be in the office and and the reason for that was we wanted the Beehive you know effect like we wanted people when they walk in both the people who work for us but also the people who are visiting us to really feel like they were tapping in the energy they were seeing lots of other interesting people you know that this was this was the kind of environment you know and the kinds of people they want they'd want to be around so we put a really big emphasis on that um you know we were in there you know every day all day um working together you know the whole the whole thing the whole thing you get from a high functioning you know kind of office environment and then like everybody else in March of 2000 like we shut that down um and we went you know completely online um and like everybody else we were shocked that we were able to continue to run the firm you know as you know you basically keep everything going uh you know over over Zoom um and so and slack and so forth and so you know kind of often away we went um we actually then actually actually had an incremental process right and you know the two weeks to crush the curve turned into two months turned into two years right it's not like everybody else we're trying to figure out how long this is going to last we start doing polls of our employees and we did like a poll like six months in and people were you know some people were like I can't wait to get back to the office simply people were like wow I don't know um you know 12 months the numbers moved 18 months the numbers moved and then we had one poll where it was basically like 100 of the young parents were like if you guys want to go back to the office good luck we're getting different jobs um it's like I get to spend time with my kids I get to to be here in the morning I get to be here at night I'm you know by the way I'm working at you know I'm working from home you know you know 12 hours a day or whatever I'm more productive than ever but like I am not going to do the you know two or three hour daily commute you know from South San Jose or from you know San Francisco or from the East Bay um you know to go to Menlo Park I'm just not going to do it anymore and so that that perked our ears up because it's like okay that's interesting um and then the other conversation we had was basically what's going to happen to our companies into our industry right and and so it's certainly not the case that all of our companies are going they're certainly not all going fully remote and we actually have quite a few companies that have actually elected to actually stay very office Centric um which is which is actually a very interesting counter programming thing that some people are doing now but you know generally speaking our companies were indicating that they were going to become more flexible and they were going to really start to spread out um and then the industry just felt like it was going to expand and we were seeing you know a lot of Founders who were frustrated being in the Bay Area you know basically left over this period and they went to other places and they started companies and and so we basically decided like we can't be in the business of partnering with people who are building the future sure if we're not living in the future ourselves and so we basically said we'll just do a hard reset we'll become um you know sort of uh say remote Centric or sort of virtual Centric I just approved a request we converted we we still have our office because it's not a long-term lease uh we converted it to hoteling um and I just signed off yesterday um on converting my former office into the apparently the new Lounge um so I'm very excited to visit visit visit the the new Hangouts face um and so uh basically what we decided is you know and so basically we're going to keep we're going to keep offices basically as as places for people to go when they need a place to work for basic for teams to be able to meet together we're also actually letting our Founders use our offices more which is actually helping them figure out how to kind of adapt through this um and then we're going to expand basically actually the wework model being ahead of its time we're going to have more smaller offices and more locations and so we've opened formally in what do we announced so far at least five which are the which ones we announced La Menlo SF Miami New York New York to New York three uh uh I think that's it for the moment yeah and then we'll yeah and we'll we'll have more in the future so we're yeah we're going to accommodate we're we're now we're we're a you know we're we're not a you know we're an investment operation not a product so we don't we don't have like you know assembly lines or software you know kind of you know production so we have a simpler version of the problem but we're letting our teams decide basically how to distribute so we have some teams that want to be in person we have some teams that want to be remote and I would say I think it's gone so we're doing all that so the way basically the firm runs now is we basically run the firm remote like all the formal meetings are on Zoom everything is kind of equalized um you know kind of that way um but the teams are free to Cluster whenever they want um and then we have a very big focus on two things one is off-sites um and so get you know every team is expected to get together on a frequent basis and we really invest in that um and then a lot more travel and so so I'm traveling you know I'll I'll my steady state I think is going to be traveling at like 4X the number of days that I used to travel um and you know and all of a sudden right it's even higher impact than it used to be to actually show up someplace and actually be there in person um so for us it feels like a real broadening out of what a firm like ours is capable of doing it feels like a way to basically accommodate scale um because we definitely felt bottlenecked uh you know where we were um and so I I think it's a way to run um you know look I think the Adam's Point like we're feeling our way through it I think a lot like I would say especially this I've talked to a lot of big company CEOs and I think they're all and I think they would generally agree with this they're all in an intermediate state they're they're all in some hybrid state where they kind of have a lot of vestiges of the old model because they've got the offices they've got and they've got the employees that you know lived in the certain places but they've also they know that they can't go back to the way things used to be so they've all got some hybrid remote virtual thing it's usually a two or three day week thing it's not working really well they've got you know this big question of do they also hire remote employees because if they do then it brings up the issue to the current employees is why can't they become remote and then they've got you know they basically all have to reinvent all the communication flows all the management systems and then they've got this fundamental question for their people especially all the new hires right and you know we're now we're going to be on five years in here pretty quick and so there's an entire generation of kids coming out of school that are going to work for these companies and they're going to have a different set of both you know expectations and issues and so this is why I think we're still at the beginning of the change like I think we're three years into it probably a 10-year process and I think the level of reinvention is going to be actually quite staggering from here yeah I think that's right I think we've we've managed through it very well we actually materialize where we need to and have a lot more Face Time you know I think I mean I see you all the time uh outside the office and I think we get much you get much more concentrated focused time together to actually be productive and it's like you know the hallway track is okay at the office but it's a little bit superficial how was your weekend what did you do when you go to an offsite it's just much more focused and conscientious about what is important to us what went well what are we not doing what do we want to be doing so my takeaway is that when we are together it actually is way more productive you know not that I don't care about your weekend I do care but uh you know it's not as important as talking about the next 10 years of the firm yeah I call this I call this the barbell right so it's it's the because everybody always asks what about the water cooler moments and I'm like God I hated the watercolor moments like I mean like to have to stand there and like talk about the football game like I I can't I can't I temporary seems like a wonderful guy I can't do this it's very deflating yeah I'm gonna I'm gonna have to I'm gonna have to push back my my partners a little bit okay go ahead um yes please go ahead for an investing firm I accept and I already said you guys are not just investors you're you're partners and businessmen and entrepreneur and it's it's factual I strongly feel and and Mark as to what's important about this conference instead it's important to think a little bit how the future is going to look it's just an opinion I've been in a few offices I strongly feel that the serendipitous connections those those so the watercolor is boring they're interesting when you're building a company and it's getting exciting and a new idea is coming and the whole team was supposed to go home and it's 8pm and everybody told their husbands their wives and their kids were being there in 30 minutes and then someone went to the bathroom sorry for the example and comes back like I have it and they say this thing that solves the entire problem and everybody gets so excited and before you know it it's 2 am and we just moved the business forward not by a week but by a year and now it's 2 A.M it's very late everyone's sleeping already well let's go out and grab a drink and now everybody's hanging out and before night you just had one of those nights that's a month that's this moment in the life of a business that then you look back and you say I know that day when it all changed that special piece cannot happen on Zoom I think human potential is in the cloud I believe it but human interaction is happening right here and I actually think if you look 10 years forward the companies that are going to make the effort now to be face to face now we can describe what face-to-face is there are many ways to do it but the companies that are actually going to do the face-to-face I think when we look back five years maybe even 10 are going to be the winners obviously I agree that the huge ones who don't know what to do with themselves that's an opportunity for incumbents to come but when I'm thinking of startups and new businesses even stronger businesses with my team we're fighting for that face-to-face time and and every time we're together the excuse of having this event brought a few of us together and three things came up about the business is we're thinking about just what we're going to talk about and and I think that's priceless now take that because we agreed that the office is a challenge bring that back into your home you're back in that multi-family building why not have those connections there why shouldn't you meet here and it makes a lot more sense for me by the way I'll meet my wife or my husband in the apartment building when I went downstairs to the pool than I do in the office so both of those things work really well and from a business point of view I can do business there also and then maybe there should be a co-working space there should be an office and maybe Enterprises are going to look so if Enterprises need to do culture and if culture is not going to be in the office anymore then maybe there's a new hybrid that has to do with the home put together with an office space then I'll give one more thought that I have I think the fact that you guys have seven offices is the future so I do think it's smaller offices and centers but it's going to be very hard for me to be convinced that not bringing people together and not having human connection is is in our nature I don't think we're built to look at the screen and I think that the one day when we're all much much older and we're second we're on our deathbed and we're looking at ourselves and we have that moment of realization and we say well how much time in my life did I spend with my loved ones with people I really care about and how much time of my life did I spend in front of a screen if that answer with front of the screen is too big I am not sure how we're gonna feel that second before it's all over look I think we would all agree you have to know what inning you're in sort of what time it is in your company there's definitely moments that matter where you all want to be in a room working together and then we do that we would agree with that for sure um so actually let's talk about Adam you've kept a lot about flow close to the vest give us a little bit about the vision you've given us a little hint throughout your answers here but what are you what are you really hoping to build uh with flow I actually thought because we were talking so much that I was going to keep it under my vest one more day oh yeah well I thought I was going to get away with it well first of all same reason about keeping it under reverse it's not that we've actually been keeping it under a vest it's that one of the many lessons that that we learned from the past is talk is cheap we just want to build we just wanna it's it's a heavy lift and we just want to get to work so we had no reason to say anything I I met a nice person here earlier today who I think said something about me when he was talking before and I said you know that's not true what you said it goes but that's what the media said and I was like well I never spoke that's right the media the media is never miscarried against him either he then told me he said you know I'm not sure I buy into flow I said well I never spoke about that either um in a very simple way we want to create an elevated experience for the resident and we want to find a way to share with the resident a portion of the value that they create I'll give that a moment we want to elevate their experience we talked about the buildings we talked about everything that's happening I actually think I don't think it's an easy job I think it's very hard but I do think the power is low you just make a little more connections you just make it a little bit more real you pay attention to the people running it you maintain it the right way you leverage technology to actually make things work instead of using nine apps use one you do simple things and you elevate the experience but then the more complicated part is you find a way to share a portion of the value and with the resident itself and because and that's the vision and because we said that it's a majority of the young adults and because Mark said that that's how people so a few numbers behind that for 80 years owning a home used to be the way that that was the majority of us creating a equity and 60 of Americans today in average their equities in the home that is the majority of equity so if we're correct and 70 are renters and that number is only going to go up what were they going to create equity and if they're going to be renters for 10 years 20 years when you go into these apartment buildings and it's true about single family but for today we'll we'll talk about apartments if you're going to go into these multi-family buildings and you're going to have this disconnected experience that you just said but you're not only going to be there for two years and then get married and move to home you're going to be there for 20.
that sounds Soul crushing right and therefore you have to solve both of the sides can I ask myself the next question sure Adam how are you going to solve most of this side that sounds really good but what are you actually got a great great question thank you thank you for that great question and well we have four pillars as we're looking at the business today we have the first one which is a branded technology first management company that actually runs the buildings we have an asset management or real estate fund or real estate company that actually owns the buildings and something cool about our new business we actually own buildings together already one of the biggest words that Mark and Ben used as I said before was alignment alignment alignment alignment so for perfect alignment we contributed into this business at least as much as as and recent contributed into this business and I'm very excited about it and it's it's amazing to feel like that and then we have a financial services company so number one management company branded technology first number two real estate Asset Management a company that can buy real estate and asset managed real estate number three financial services and the fourth pillar is this mechanism that's going to take some of the value and share it with the value creators and what we get so excited about the vision of flow and The Business of flow is that it's actually a flywheel if we can actually create a better experience in the building then the building performs better and makes a higher noi if the building makes a higher noi then we'll be able to raise more money and buy more buildings if we buy more buildings then we'll be able to run more buildings and have more users in those buildings and those users are going to start using our financial services now the reason they're going to use the financial services the first thing you do in buildings is you charge rent every month and that's 35 of their total wallet so that payments company that's charging your rent already has a real relationship with the user if that financial services company is going to do what we wanted to do and create services that are actually meaningful recall where you think of it as Financial wellness and give services that are actually meaningful then that again is going to drive more users and then if we are able to take this value creating mechanism and share with the residents a portion of the value it's going to make them feel ownership and it's not just ownership I feel like I'm part of something it's I actually own part of something and again the word ownership is a very complicated word especially in this place but if there is perceived value and if that value appreciates over time then I feel like I'm part of a community and a very funny example that we like to give is if you're in your apartment building and you're a renter and your toilet gets clogged you call the super if you're in your own apartment and you're and you bought it and you own it and your toilet gets clogged you take the plunger and it's it's the difference when feeling like you own something to just feeling like you're renting from being trans transactional to actually being part of a community and our vision is to bring it all together and just one more example of just to put it into numbers average churn in a property Management's average churn in multi-family in this country is 50 it means the user stays in average for two years if the user now enjoys their experience more and feels like they have a portion of the value and chooses to stay a little longer and that average turn goes down from 50 percent to 40 percent without getting too deep into the numbers the noi of the building will go up by approximately five percent which increases the returns of the building for those LPS for the investors by 500 basis points which in real estate is an unheard of number and by tackling this challenge vertically is what flow is planning to do and as I said we're just getting started excellent I'm going to wrap this up with one with a sort of common question for both of you are there any model cities that are sort of doing this right from a regulatory standpoint from a building standpoint from a community neighborhood standpoint and then part two is sort of what role does government have to play uh in sort of facilitating and improving either you know Home Building homeowner ownership and all these components so we'll start with with Mark Mark yeah well look cities were stern-ups at one point right like so every city was a startup um and you know there you there's like incredible stories if you go back far enough like creation of cities like Los Angeles or Washington DC you know for that matter um you know in the in the 20th century that kind of went at least in the in the west that kind of went out of fashion became sort of an intractable thing to try to do you know there were some entrepreneurs who thought hard about it and gave shots at it so Walt Disney right had a whole you know Walt Disney had a whole Vision um you know what you know the Disney company to this day has these you know planned communities that kind of come from that uh you know Walt Disney actually had this vision for they actually have this thing um called the Epcot um experimental prototype city of tomorrow um and stayed in the museum in San Francisco if you go to the museum you can see it oh is that right okay the whole thing well they still I think they still have the Epcot what the part of Epcot that got built I think is still in in Florida so you can go visit I think the remnants of Epcot so um you know this is like this is like sort of futurism from the 60s you know kind of in in in Disney's mind and he wasn't able to get he passed away he wasn't able to fully develop Epcot but he he was he was kind of reaching in this direction uh towards the end of his career and then you know there are other examples in the U.S you know it's probably um what is it Irvine um you know took a big swing at this um and actually it was has been very successful and then um you know Venice uh Kimmy you know sort of you know created the you know La created the Venice canals as a sort of a plan commute so you know there there are various ideas like this it's been a long time since somebody's really taken a hard swing and and so basically what you have you know basically what you have are Legacy systems you've just got this sort of entrenched you know complicated power you know kind of system local homeowners I mean it almost seems deterministic that if a city becomes successful it basically the local homeownership whatever political base devotes itself to preventing the construction new housing and it seems like a real a real trap so I'll add to what Mark is saying but if a city was a business and it's an old business and it's 30 years old then they're going to say forget that business we're going to start a new one we're going to fund it we're going to start it and we're gonna and we're gonna take over the problem with cities they're built so to go into a city now and change let's just start with something very simple most of the city is concrete and roads where cars are driving as and there's so many new Solutions and you can really talk today about what's happening and anybody who knows New York City and so when Uber was getting bigger and bigger how the yellow taxes started disappearing was an unbelievable experience and how the medallions that used to cost a million three suddenly so it's it is a very challenging thing to actually reimagine a city when it's already built and there's things you can do it when you look at these buildings there's single standing Villages yes a building with 400 apartments we can reimagine what happens inside of it but reimagining a city is a big is a big gay undertaking and actually one of the only places actually in Saudi Arabia where I know some of the team members were just there they're actually going for it so there are places in the world right now and and it's very Innovative and it's very impressive that they're doing it that they that people are actually trying to build new cities but the answer to that and sort of how government can help there are technology companies right now construction companies there there are different things there's there's a construction company here called icon that's using technology that the government is going to need to partner with them at some point because they have found ways to build a home in four days that used to take that used to take a year and a half and as you can do more and more of those things what we're gonna do is I believe through Innovative Technologies be able to build it fast enough to give people the courage to go and build a new but to go into the old ones is very hard a crazy idea is the office now everything that's happening in office can you go and convert some of these dead offices into some of your dish you could think about that and I think the role of government has always been very important for this country I think for us that flow and this is another lesson from the past we used to think and I used to think we had to own everything I think the category is so big that the only way we're going to achieve anything is through a partnership partnership with government partnership with current players and partnership with new players that are going to come and I think it's the only way to solve this problem and I'll finish by saying that I actually think the housing crisis that we described might be one of the biggest challenges that the US is facing today but the reason it's hard to understand it it's because if you really want to get it it's five to ten years down the road the problem with housing it takes five to ten years and Mark I agree with your assumption that we have about five years to do something really big about it and all I can tell you is I think we have the right team to give it a shot excellent uh well thank you both uh for being here this is a great discussion we're gonna wrap up and get everyone out of here and talk about the party tonight thanks fantastic thanks everybody as a reminder this conversation was part of a16z's American dynamism Summit in Washington DC you can find the full library of videos from the event in November by going to a16c.com a dash Summit

Descripción

After a16z announced our investment into Adam Neumann’s new company, Flow, it felt like almost everyone – whether it was other VCs, founders, or journalists – had something to say.

But the one person that you didn’t hear from was Adam himself.

In this never-before shared footage from a16z’s American Dynamism Summit in Washington DC, Adam Neumann sits down with Marc Andreessen and David Ulevitch, to discuss the opportunities that have emerged from post-pandemic shifts in both work and home, and what Flow is doing to address that.

Find the full library of American Dynamism Summit recordings at a16z.com/ad-summit.

Timestamps:
00:00 - Introduction
01:14 - Getting back in the arena
08:45 - The opportunity in housing
17:16 - Lessons from WeWork
20:34 - Work & home post-pandemic
29:54 - Moving to the cloud
37:44 - Office serendipity
41:18 - Building Flow
47:33 - Cities as startups

Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. For more details please see a16z.com/disclosures.

Captions con timestamps

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[00:00] and  I  just  want  you  to  know  that  it's
[00:01] 
[00:01] part  of  the  game  to  get  punched  and  the
[00:03] 
[00:03] question  is  not  are  you  gonna  get  back
[00:05] 
[00:06] in  the  game  the  question  is  is  when  back
[00:09] 
[00:09] in  August  after  a6c  announced  our
[00:11] 
[00:11] investment  into  Adam  Newman's  new
[00:12] 
[00:12] company  flow  it  felt  like  almost
[00:14] 
[00:14] everyone  whether  it  was  other  VCS
[00:16] 
[00:16] Founders  or  journalists  had  something  to
[00:18] 
[00:18] say  but  the  one  person  you  didn't  hear
[00:20] 
[00:20] from  was  Adam  himself  and  this  never
[00:22] 
[00:22] shared  before  footage  from  our  American
[00:24] 
[00:24] dynamism  Summit  back  in  November  Adam
[00:26] 
[00:26] sits  down  with  a16c  co-founder  Mark
[00:28] 
[00:28] Andreessen  and  a  16c  venture  General
[00:30] 
[00:30] partner  David  ulovich  they  start  by
[00:33] 
[00:33] discussing  why  Adam's  chosen  to  step
[00:34] 
[00:34] back  into  the  arena  but  also  why  flow
[00:37] 
[00:37] that  leads  into  the  inevitable
[00:38] 
[00:38] conversation  around  how  the  pandemic
[00:40] 
[00:40] fundamentally  shifted  both  work  and  home
[00:42] 
[00:42] as  they  touch  on  a16z's  move  to  the
[00:44] 
[00:44] cloud  cities  as  startups  and  ultimately
[00:47] 
[00:47] what  it  might  take  to  disrupt  the
[00:48] 
[00:48] world's  largest  asset  class  we  also  get
[00:51] 
[00:51] an  insights  group  into  how  Adam  is
[00:52] 
[00:52] thinking  about  the  four  pillars  of  flow
[00:54] 
[00:54] from  technology  to  financial  services
[00:56] 
[00:56] finally  this  video  was  recently
[00:58] 
[00:58] published  alongside  our  full  live
[00:59] 
[00:59] library  of  American  dynamism  Summit
[01:01] 
[01:01] recordings  which  you  can  find  at
[01:03] 
[01:03] a16c.com  ad-summit
[01:07] 
[01:07] [Music]
[01:12] 
[01:12] [Music]
[01:14] 
[01:14] thank  you  gentlemen  for  being  here  I'm
[01:16] 
[01:16] going  to  just  jump  right  into  it  those
[01:18] 
[01:18] of  you  that  have  uh  heard  Adam  and  Mark
[01:20] 
[01:20] speak  know  that  they  have  a  lot  to  say
[01:22] 
[01:22] and  they're  very  smart  so  we  aren't
[01:24] 
[01:24] going  to  waste  any  time
[01:26] 
[01:26] Adam  three  years  ago  you  stepped  down
[01:28] 
[01:28] from  your  role  as  CEO  of  wework  one  of
[01:30] 
[01:30] the  most  well-known  real  estate
[01:32] 
[01:32] companies  ever  created
[01:34] 
[01:34] you  could  have  sailed  off  into  the
[01:35] 
[01:35] sunset  a  lot  of  Founders  do  that  hang
[01:37] 
[01:37] out  in  the  Mediterranean  uh  but  you
[01:39] 
[01:39] decided  to  start  another  company  again
[01:40] 
[01:40] you're  not  naive  you  know  it's  hard  you
[01:43] 
[01:43] know  that  there's  a  lot  of  attention  on
[01:44] 
[01:44] you  uh  so  how  did  you  decide  that  you
[01:47] 
[01:47] wanted  to  Chase  and  build  a  new
[01:48] 
[01:48] impactful  company  and  uh  chase  a  big
[01:51] 
[01:51] vision  and  dedicate  your  time  to
[01:52] 
[01:52] building  why  why  get  back  in  the  game
[01:54] 
[01:54] get  back  in  the  arena
[01:56] 
[01:56] first  of  all  thank  you  for  having  me
[01:58] 
[01:58] thank  you  Mark  thank  you  David  I
[02:00] 
[02:00] apologize  about  the  sandals  I  broke  my
[02:02] 
[02:02] toe  I'm  supposed  to  wear  different  shoes
[02:06] 
[02:06] you  know  when  I  stepped  down  three  years
[02:09] 
[02:09] ago
[02:09] 
[02:09] [Music]
[02:11] 
[02:11] the  first  thing  I  actually  did  was  I
[02:13] 
[02:13] took  a  moment  and  I  just  wanted  to  take
[02:15] 
[02:15] a  second  and  think  of  the  successes  but
[02:17] 
[02:17] also  think  of  the  mistakes  and  the
[02:19] 
[02:19] lessons  and  all  the  different  things
[02:20] 
[02:20] that  that  I  did  and  that  we  did  as  a
[02:23] 
[02:23] team  and  even  though  I  was  very  proud  of
[02:25] 
[02:25] what  we  built  I  really  felt  like  there
[02:27] 
[02:27] was  a  lot  of  thinking  to  do  and  that  was
[02:29] 
[02:29] sort  of  my  first  thing
[02:30] 
[02:30] as  that  was  happening  I  started  building
[02:32] 
[02:32] a  family  office  and  with  my  family
[02:34] 
[02:34] office  we  invested  in  about  50  Venture
[02:36] 
[02:36] Investments  we  did  private  Equity
[02:39] 
[02:39] Investments  we  did  liquid  market  trading
[02:41] 
[02:41] and  each  one  of  those  things  taught  me
[02:43] 
[02:43] something  new  that  I  wasn't  aware  of
[02:45] 
[02:45] before  liquid  markets  actually  taught  me
[02:47] 
[02:47] about  Wall  Street  and  as  I  was  sitting
[02:50] 
[02:50] with  the  team  and  we  were  doing
[02:51] 
[02:51] different  investing  and  listening  to
[02:52] 
[02:52] earning  calls  I  was  like  oh  wow  that's
[02:55] 
[02:55] what  you  guys  are  listening  to  and
[02:56] 
[02:56] that's  what's  interesting  for  you  and
[02:58] 
[02:58] that  gave  me  a  perspective  that  I  didn't
[02:59] 
[02:59] have  before
[03:01] 
[03:01] when  I  was  sitting  with  entrepreneurs  as
[03:03] 
[03:03] we  did  our  Venture  investing  the  first
[03:05] 
[03:05] part  when  you  invest  and  write  the  check
[03:06] 
[03:06] is  a  lot  of  fun  but  then  comes  the  part
[03:08] 
[03:08] where  you're  talking  to  them  and
[03:09] 
[03:09] listening  and  they  have  problems  and  I
[03:12] 
[03:12] got  to  give  advice  to  these
[03:13] 
[03:13] entrepreneurs  and  they  didn't  always
[03:16] 
[03:16] listen
[03:17] 
[03:17] and  I  was  like  okay  that's  how  it  feels
[03:19] 
[03:19] when  an  entrepreneur  is  on  the  list  I
[03:22] 
[03:22] was  like  okay  I  got  that  and  that  taught
[03:24] 
[03:24] me  a  lot  and  actually  made  me  understand
[03:25] 
[03:25] Mark  and  Ben  and  Venture  Capital  more
[03:29] 
[03:29] and  as  we're  doing  all  of  this  and  this
[03:31] 
[03:31] is  now  where  covet  is  happening  this  is
[03:33] 
[03:33] March  2020  we  were  looking  at  real
[03:35] 
[03:35] estate  because  it's  something  we  care
[03:36] 
[03:36] about  and  we  just  felt  that  there  was
[03:38] 
[03:38] going  to  be  an  opportunity  in
[03:39] 
[03:39] multi-family  it  was  a  simple  trade  it
[03:41] 
[03:41] was  cap  rates  were  at  four  eight  and  we
[03:43] 
[03:43] thought  they  were  going  to  compress  and
[03:45] 
[03:45] we  saw  interest  rates  and  we  thought
[03:46] 
[03:46] there  was  an  opportunity  so  we  decided
[03:48] 
[03:48] to  go  as  a  as  a  family  office  very  deep
[03:50] 
[03:50] into  multi-family  we  bought
[03:52] 
[03:52] approximately  4  000  Apartments
[03:54] 
[03:54] and  as  we're  doing  that  I  started
[03:58] 
[03:58] walking  these  buildings  and  even  though
[04:00] 
[04:00] initially  it  was  a  trade  I  started
[04:03] 
[04:03] feeling  like  there  was  something  more
[04:04] 
[04:04] that  can  be  done  I  started  feeling  like
[04:06] 
[04:06] the  residential  experience  is  not  what
[04:08] 
[04:08] it  should  be  and  just  to  backtrack  this
[04:10] 
[04:10] a  little  bit  so  going  backwards  again  to
[04:13] 
[04:13] 2019  we're  stepping  down  and  now  it's
[04:15] 
[04:15] early  2020  as  the  whole  thing  is
[04:18] 
[04:18] happening  and  maybe  you  wouldn't  be
[04:19] 
[04:19] surprised  but  the  phone  is  not  ringing
[04:22] 
[04:22] as  much  as  it  used  to  be  just  a  few
[04:25] 
[04:25] months  before  I  got  a  phone  call  from
[04:27] 
[04:27] Mark  and  we  never  met  and  Mark
[04:30] 
[04:30] introduces  himself  hello  I'm  Mark
[04:31] 
[04:31] Andrews  and  I  said  I  know  you  are  mark
[04:33] 
[04:33] thank  you  so  much  for  calling  me  and  he
[04:36] 
[04:36] sort  of  we're  having  discussion  we're
[04:38] 
[04:38] talking  about  something  but  very  quickly
[04:39] 
[04:39] turned  to  Mark  asked  can  we  saw  Adam  how
[04:41] 
[04:41] are  you  doing
[04:42] 
[04:42] and  I  told  him  this  and  that  and  this
[04:44] 
[04:44] and  that  and  he  says  to  me  oh  you're
[04:47] 
[04:47] still  in  that  stage  and  I  look  I  was
[04:50] 
[04:50] like  this  was  on  the  phone  I  said  the
[04:51] 
[04:51] mark  what  stage  is  that  and  he  goes  the
[04:54] 
[04:54] stage  where  you  believe  everything  the
[04:55] 
[04:55] media  says
[04:57] 
[04:57] and  I  said  that  well  I'm  not  in  that
[04:59] 
[04:59] stage  and  I  know  we  built  a  great
[05:01] 
[05:01] company  and  of  course  I  don't  believe
[05:02] 
[05:02] but  you  know  they  are  saying  quite  a  lot
[05:04] 
[05:04] of  things
[05:05] 
[05:05] and  Mark  says  to  me  Adam  we  don't  know
[05:07] 
[05:07] each  other  but  let  me  tell  you  something
[05:08] 
[05:09] about  venture  capital  and  high  growth
[05:11] 
[05:11] companies  and  the  bigger  the  Venture  the
[05:13] 
[05:13] bigger  the  growth  what  I'm  about  to  tell
[05:14] 
[05:14] you  is  more  true  it's  hand-to-hand
[05:16] 
[05:16] combat  anybody  who  doesn't  know  that
[05:19] 
[05:19] Ventures  hand-to-hand  combat  doesn't
[05:20] 
[05:20] actually  understand  or  has  never  done  it
[05:22] 
[05:22] before  and  when  you  fight  once  in  a
[05:25] 
[05:25] while  you  get  punched  and  he  said  I
[05:26] 
[05:27] guarantee  you  because  he  was  very  nice
[05:28] 
[05:28] he  said  a  lot  of  our  companies  use  your
[05:30] 
[05:30] products  not  just  in  the  US  but  all  over
[05:31] 
[05:31] the  world  instead  I  guarantee  you  that
[05:34] 
[05:34] for  every  mistake  you  made  there's  a
[05:35] 
[05:35] hundred  things  that  you  did  right  and  I
[05:37] 
[05:37] just  want  you  to  know  that  it's  part  of
[05:38] 
[05:38] the  game  to  get  punched  and  the  question
[05:41] 
[05:41] is  not  are  you  gonna  get  back  in  the
[05:43] 
[05:43] game  the  question  is  is  when  and  just  so
[05:47] 
[05:47] you  know  you  have  a  friend  here  that
[05:48] 
[05:48] you've  never  met  before  but  we've  been
[05:50] 
[05:50] tracking  even  if  you  ever  decide  to  do
[05:51] 
[05:51] anything  then  then  call  US
[05:54] 
[05:54] and  now  fast  forward  well  I'll  say  one
[05:58] 
[05:58] more  thing  about  it  because  it  was  very
[05:59] 
[05:59] meaningful  I  hung  up  the  phone  and  I
[06:01] 
[06:01] still  remember  this  I  walked  to  Rebecca
[06:03] 
[06:03] my  wife  and  I  was  like  I  just  had  the
[06:05] 
[06:05] most  amazing  phone  call  this  guy  Martin
[06:08] 
[06:08] treason  and  explained  to  her  who  Marcus
[06:09] 
[06:09] called  me  and  basically  was  very
[06:12] 
[06:12] encouraging  and  gave  me  a  different
[06:13] 
[06:13] perspective  to  look  at  what  just
[06:15] 
[06:15] occurred
[06:16] 
[06:16] and
[06:18] 
[06:18] she  thought  it  was  amazing  and  I  thought
[06:20] 
[06:20] it  was  amazing  and  Mark  I  don't  know  if
[06:21] 
[06:21] I've  ever  had  the  chance  to  actually
[06:23] 
[06:23] tell  you  it  was  a  meaningful  moment  for
[06:25] 
[06:25] me  and  I  really  appreciate  it
[06:28] 
[06:28] and  fast  forward  now  a  year  and  a  half
[06:31] 
[06:31] we  kept  these  buildings  that  we  bought
[06:33] 
[06:33] ended  up  being  a  really  good  trade  and
[06:35] 
[06:35] everything  that  we  thought  was  happening
[06:36] 
[06:36] was  happening  and  we  started  building
[06:38] 
[06:38] this  brand  it  didn't  have  a  name  yet  but
[06:40] 
[06:40] we  started  building  this  business  and  we
[06:41] 
[06:41] saw  all  this  opportunity  which  we'll
[06:43] 
[06:43] talk  about  a  little  bit  later  and  around
[06:46] 
[06:46] February  we  spoke  again  and  Mark  asked
[06:49] 
[06:49] me  what's  up  and  I  told  him  what  was
[06:51] 
[06:51] happening  and  that  we've  been  developing
[06:52] 
[06:52] in  the  business  by  this  point  this  is
[06:54] 
[06:54] over  a  year  old  and  we've  been  doing
[06:56] 
[06:56] more  and  more  and  we  started  Building
[06:57] 
[06:57] Technology  and  we  bought  a  company  and
[06:59] 
[06:59] we  did  a  few  different  things  and  Mark
[07:01] 
[07:01] said  that  when  you  come  and  present  it
[07:02] 
[07:02] to  the  team  and  we  went  and  we  met  the
[07:05] 
[07:05] team
[07:05] 
[07:06] and
[07:08] 
[07:08] the  first  thing  I  noticed  when  we  all
[07:10] 
[07:10] met  is  that  the  Andreessen  Horwitz  team
[07:12] 
[07:12] was  not  like  the  venture  capitalist  that
[07:14] 
[07:14] I  was  used  to  and  I  had  quite  a  lot  of
[07:16] 
[07:16] experience  with  Venture  Capital  before
[07:18] 
[07:18] and  it  didn't  feel  like  investors  it
[07:20] 
[07:20] actually  felt  like  businessmen  like
[07:22] 
[07:22] entrepreneurs  and  I  actually  asked  I
[07:23] 
[07:23] just  asked  mark  behind  stage  I  said  how
[07:25] 
[07:25] many  partners  do  you  have  that  are
[07:26] 
[07:26] entrepreneurs  and  he  said  20.  and  I
[07:29] 
[07:29] gotta  tell  you  that's  very  different
[07:30] 
[07:30] from  other  businesses
[07:32] 
[07:32] and  as  as  we're  having  the  discussion
[07:35] 
[07:35] one  of  Mark's  Partners  asked  me Adam  are
[07:37] 
[07:37] you  raising  money  and  I  said  I'm  not
[07:39] 
[07:39] sure  we're  going  to  build  this  one  on
[07:40] 
[07:40] our  own  I'm  not  sure  because  one  of  our
[07:42] 
[07:42] lessons  was  you  got  to  choose  your
[07:43] 
[07:43] partners  really  carefully  he  said  well
[07:45] 
[07:45] maybe  you  should  consider  us  let  us  look
[07:47] 
[07:47] into  the  business  and  see  if  it's
[07:48] 
[07:48] interesting  and  if  so  maybe  we  should
[07:50] 
[07:51] consider  us  and  then  Digi  led  a  very
[07:53] 
[07:54] rigorous  diligence  process  and  they
[07:56] 
[07:56] asked  us  a  lot  of  questions  and  learned
[07:58] 
[07:58] everything  about  our  business  and  as  we
[08:00] 
[08:00] were  getting  to  know  Andresen  I  realized
[08:03] 
[08:03] that  these  are  the  kind  of  partners  that
[08:04] 
[08:04] I  was  always  looking  for  but  never
[08:06] 
[08:06] really  knew  that  existed
[08:09] 
[08:09] so  to  answer  your  question
[08:11] 
[08:11] I  was  always  building  it  but  building  it
[08:14] 
[08:14] with  a  partner  was  something  that  only
[08:15] 
[08:15] happened  because  of  this  demon  because
[08:17] 
[08:17] of  the  way  I  met  them  and  I  could  just
[08:19] 
[08:19] tell  you  that  we  had  our  first  board
[08:20] 
[08:20] meeting  and  one  minute  afterwards  Mark
[08:22] 
[08:22] called  me  and  said  Adam  can  I  give  you
[08:24] 
[08:24] some  feedback  I  said  of  course  Mark  he
[08:26] 
[08:26] said  well  when  your  team  said  this  and
[08:27] 
[08:27] this  and  this  I  don't  agree  with  that
[08:29] 
[08:29] let  me  tell  you  why  and  here's  the
[08:31] 
[08:31] experience  I  have  and  here's  what  I  want
[08:32] 
[08:32] to  warn  you  from  so  I  welcome  the
[08:34] 
[08:34] feedback  I'm  so  excited  to  be  a  partner
[08:36] 
[08:36] I'm  excited  to  be  back  in  the  game  not
[08:38] 
[08:38] alone  but  with  the  team  and  we're  just
[08:41] 
[08:41] getting  started  but  the  future  is
[08:43] 
[08:43] there's  a  lot  of  potential  that's  that's
[08:45] 
[08:45] awesome  and  I  will  say  on  there's  a
[08:48] 
[08:48] whole  bunch  of  venture  capitals  in  the
[08:49] 
[08:49] room  and  we  are  all  very  happy  that  we
[08:51] 
[08:51] work  exists  so  that  our  portfolio
[08:53] 
[08:53] company  is  not  signing  these  long-term
[08:54] 
[08:54] leases  in  this  Dynamic  world  that  we
[08:56] 
[08:56] live  in  and  they  get  to  go  into  the
[08:58] 
[08:58] offices  they  want  to  be  in  in  the  right
[08:59] 
[08:59] cities  at  the  right  time  so  what  we're
[09:01] 
[09:01] going  to  talk  more  about  flow  in  the  new
[09:03] 
[09:03] business  in  a  moment  Mark  I  want  to
[09:05] 
[09:05] shift  to  you  you  know  you  and  I  have
[09:07] 
[09:07] talked  about  housing  for  a  long  time
[09:08] 
[09:08] long  long  before  this  investment
[09:10] 
[09:10] something  you've  thought  about  for  a
[09:11] 
[09:11] long  time
[09:13] 
[09:13] why  is  housing  important  why  is  it
[09:16] 
[09:16] particularly  relevant  why  is  it  even
[09:17] 
[09:17] part  of  American  dynamism
[09:19] 
[09:19] yeah  so  there's  a  critique  of  Silicon
[09:22] 
[09:22] Valley  in  the  tech  industry  that  you
[09:23] 
[09:23] know  on  various  sometimes  I  agree  with
[09:25] 
[09:25] sometimes  I  don't  but  um  you  know
[09:26] 
[09:27] there's  a  critique  that  basically  says
[09:28] 
[09:28] look  you  guys  have  done  a  great  job  you
[09:29] 
[09:29] know  silicon  Valley's  done  a  great  job
[09:30] 
[09:30] over  the  years  like  the  really  like
[09:32] 
[09:32] unimportant  things
[09:33] 
[09:33] um  and  so  like  you  know  um  you  know
[09:35] 
[09:35] you've  consumed  electronics  and  video
[09:37] 
[09:37] games  and  media  and  e-commerce  and  like
[09:40] 
[09:40] it's  all  great  it's  all  fine  it's  all
[09:41] 
[09:41] good  and  by  the  way  like  we  do  those
[09:43] 
[09:43] things  we're  very  proud  of  our  efforts
[09:44] 
[09:44] in  those  spaces  and  we  actually  think  we
[09:47] 
[09:47] actually  think  they're  very  important
[09:48] 
[09:48] but  you  know  they're  basically  they're
[09:49] 
[09:49] small  slices  of  GDP
[09:51] 
[09:51] um  and  then  if  you  look  at  basically  the
[09:53] 
[09:53] GDP  pie  chart  which  is  also  the  you  know
[09:55] 
[09:55] sort  of  consumer  spending  pie  chart  the
[09:57] 
[09:57] the  things  that  people  spend  money  on
[09:58] 
[09:58] that  really  matter  in  their  lives
[09:59] 
[09:59] there's  basically  three  really  big  ones
[10:01] 
[10:01] uh  right  Healthcare  education  and
[10:03] 
[10:03] housing
[10:05] 
[10:05] um  and  if  you  look  at  kind  of  all  the
[10:06] 
[10:06] economic  statistics  by  sector  Healthcare
[10:08] 
[10:08] education  housing  are  basically
[10:09] 
[10:09] increasing  uh  you  know  in  terms  of  cost
[10:12] 
[10:12] you  know  at  a  much  faster  rate  than  than
[10:14] 
[10:14] all  the  others  um  and  there  are  the
[10:16] 
[10:16] sectors  where  the  the  tech  industry  has
[10:17] 
[10:17] had  the  least  impact  historically  and
[10:19] 
[10:19] you  know  and  of  those  the  biggest  one  is
[10:21] 
[10:21] housing  right  it's  sort  of  the  housing
[10:22] 
[10:22] is  the  single  biggest  uh  you  know  kind
[10:24] 
[10:24] of  thing  that  most  families  spend  money
[10:25] 
[10:25] on
[10:26] 
[10:26] um  and  so  you  know  it's  really  Central
[10:27] 
[10:27] you  know  for  from  from  that  standpoint
[10:29] 
[10:30] um you  know  it's  very  Central  from  a
[10:31] 
[10:31] from  a  from  an  economic  standpoint  in
[10:32] 
[10:32] the  life  of  a  family  because  right
[10:34] 
[10:34] there's  this  you  know  very  big  question
[10:35] 
[10:35] which  is  you  know  if  you  you  know  if  if
[10:37] 
[10:37] you  own  there  are  you  know  potentially
[10:39] 
[10:39] big  downsides  because  you  might  be  stuck
[10:40] 
[10:40] you  know  in  one  place  where  maybe  you
[10:42] 
[10:42] don't  want  your  family  to  be  for  the
[10:43] 
[10:43] next  30  years  because  maybe  opportunity
[10:45] 
[10:45] shifts  around
[10:46] 
[10:46] um  you  know  but  if  you  rent  you  don't
[10:47] 
[10:47] necessarily  write  build  up  Equity  by
[10:49] 
[10:49] default  you  know  with  the  way  that  most
[10:51] 
[10:51] uh  most  uh  most  apartment  offerings  work
[10:54] 
[10:54] um  so  they're  you  know  so  there's  big
[10:56] 
[10:56] economic  consequences  there's  also  big
[10:58] 
[10:58] social  consequences  and  political
[10:59] 
[10:59] consequences  right  which  is  um  you  know
[11:01] 
[11:01] and  this  is  something  that's  kind  of
[11:03] 
[11:03] been  deep  in  the  American  character  for
[11:04] 
[11:04] you  know  for  for  many  decades  but  this
[11:06] 
[11:06] idea  that  if  you  basically  if  you  if  you
[11:08] 
[11:08] have
[11:09] 
[11:09] a  sense  of  commitment  if  you  have  a
[11:12] 
[11:12] sense  that  you  are  actually  invested  in
[11:14] 
[11:14] the  place  where  you  live  you  were  more
[11:15] 
[11:15] connected  to  the  society  you're  more
[11:17] 
[11:17] connected  to  the  culture  and  then
[11:19] 
[11:19] ultimately  you're  more  you  know  you're
[11:20] 
[11:20] more  connected  to  the  politics  you  know
[11:21] 
[11:21] to  the  politics  of  the  to  the  political
[11:23] 
[11:23] uh  to  the  political  body
[11:25] 
[11:25] um  and  so  you  know  there's  been
[11:26] 
[11:26] long-running  policies  in  in  you  know  the
[11:27] 
[11:27] United  States  to  encourage  homeownership
[11:29] 
[11:29] now  it  turns  out  those  could  be  overdone
[11:31] 
[11:31] they  can  end  up  with  problems  and  we  saw
[11:32] 
[11:32] a  lot  of  the  problems  that  kind  of  you
[11:34] 
[11:34] know  came  out  of  that  approach  and  you
[11:35] 
[11:35] know  kind  of  the  historical  approach  in
[11:36] 
[11:36] the  in  the  2008  financial  crisis  but
[11:38] 
[11:38] nevertheless  there  is  like  a  very  kind
[11:40] 
[11:40] of  big  deep  meaningful  you  know  kind  of
[11:41] 
[11:41] sense  of  identity  that  comes  with  uh
[11:43] 
[11:43] comes  with  housing
[11:44] 
[11:44] um  why  does  this  matter  uh  you  know  kind
[11:47] 
[11:47] of  from  a  from  a  broad  standpoint
[11:49] 
[11:49] um  so  the  reason  I  think  this  matters  so
[11:50] 
[11:50] much  is  because  uh  geography  is  so  um  uh
[11:54] 
[11:54] Central  to  economic  opportunities  so
[11:56] 
[11:56] right  so  so  basically  take  a  step  back
[11:59] 
[11:59] uh  the  role  of  cities  right  in  human
[12:01] 
[12:01] society  so  like  cities  are  a  human
[12:03] 
[12:03] invention  you  know  if  there  were  many
[12:04] 
[12:04] hundreds  of  thousands  millions  of  years
[12:06] 
[12:06] where  you  know  people  you  know  people
[12:07] 
[12:07] were  running  around  without  you  know  in
[12:09] 
[12:09] clients  and  tribes  uh  not  forming  into
[12:11] 
[12:11] cities  then  about  4  000  years  ago  cities
[12:13] 
[12:13] were  basically  invented  and  and  people
[12:14] 
[12:14] started  to  Cluster  uh  that  way
[12:17] 
[12:17] um  why  were  cities  invented  a  bunch  of
[12:19] 
[12:19] reasons  but  one  of  the  big  ones  is
[12:20] 
[12:20] there's  there's  economic  payoff  to  being
[12:22] 
[12:22] in  a  city  and  the  way  that  it  works  is
[12:24] 
[12:24] if  you  are  you  know  if  you  have  a
[12:26] 
[12:26] certain  level  of  productivity  and  you're
[12:28] 
[12:28] in  a  rural  environment  you  don't  have
[12:29] 
[12:30] many  opportunities  to  work  with  other
[12:31] 
[12:31] people  right  who  are  highly  productive
[12:33] 
[12:33] if  you  move  to  a  city  all  of  a  sudden
[12:34] 
[12:34] you're  surrounded  by  lots  of  other
[12:36] 
[12:36] people  who  are  highly  productive  and  all
[12:37] 
[12:37] of  a  sudden  there's  a  catalytic  effect
[12:39] 
[12:39] basically  this  this  this positive
[12:40] 
[12:40] feedback  loop  that  forms  where  kind  of
[12:42] 
[12:42] everybody  becomes  more  productive  and  so
[12:44] 
[12:44] basically  it's  the  these  cities  are
[12:46] 
[12:46] basically  the  foundation  of  modern
[12:48] 
[12:48] economic  growth  economists  call  this  the
[12:50] 
[12:50] agglomeration  effect  which  is  basically
[12:52] 
[12:52] if  you  like  slam  people  together  you  you
[12:53] 
[12:53] know  sort  of  uh  you  know  you  can  get  a
[12:55] 
[12:55] lot  of  good  things  out  of  that
[12:57] 
[12:57] um  you  know  the  the  the  the  the  West
[12:59] 
[12:59] developed  you  know  we  the  the  story  of
[13:01] 
[13:01] the  West  is  the  story  of  cities  and  the
[13:02] 
[13:03] creation  of  all  these  the  you  know  these
[13:04] 
[13:04] these  amazing  cities
[13:06] 
[13:06] um  and  then  you  know  over  the  last  50
[13:08] 
[13:08] years  you  know  that  that  kind  of  trend
[13:09] 
[13:09] has  gone  into  hyperdrive  and  you've  had
[13:11] 
[13:11] this  emergence  of  what  economists  call
[13:12] 
[13:12] Superstar  cities  where  you've  got  these
[13:14] 
[13:14] specific  cities  like  Washington  DC  New
[13:16] 
[13:16] York  City  Boston  San  Francisco  Bay  Area
[13:18] 
[13:18] Los  Angeles  you  know  um  and  then  you
[13:21] 
[13:21] know  internationally  London  and  Tokyo
[13:23] 
[13:23] and  Singapore  and  so  forth  and  Paris
[13:24] 
[13:24] there  are  kind  of  these  cities  that  are
[13:26] 
[13:26] like  irresistible  draws  for  people  who
[13:28] 
[13:28] are  you  know  highly  ambitious  and  want
[13:29] 
[13:29] to  be  around  a  lot  of  other  highly
[13:31] 
[13:31] ambitious  highly  productive  people  it
[13:33] 
[13:33] turns  out  as  a  result  of  that  Superstar
[13:35] 
[13:35] City  clustering  thing  there's  been  a
[13:36] 
[13:36] bifurcation  in  the  housing  market  right
[13:38] 
[13:38] where  basically  those  Superstar  cities
[13:40] 
[13:40] they  become  you  know  basically  occupied
[13:41] 
[13:42] at  some  point  you  know  people  end  up
[13:43] 
[13:43] with  a  political  agenda  and  then  they
[13:44] 
[13:44] stop  building  housing  right  and  so  the
[13:46] 
[13:46] places  where  people  want  to  go  and  want
[13:48] 
[13:48] their  kids  to  go  are  very  difficult  to
[13:50] 
[13:50] get  to  in  the  San  Francisco  Bay  area  is
[13:52] 
[13:52] like  a  you  know  a  classic  example  this
[13:53] 
[13:53] you  know  San  Francisco  last  year  like
[13:55] 
[13:55] authorized  I  think  6  000  new  housing
[13:57] 
[13:57] units  right  which  it  was  just  like  an
[13:59] 
[13:59] absurdly  low  number  relative  to  the  the
[14:00] 
[14:00] demand  for  people  who  want  to  move  there
[14:03] 
[14:03] um  and  then  the  places  where  that  do  not
[14:04] 
[14:04] have  this  kind  of  clustering
[14:06] 
[14:06] agglomeration  Superstar  City  effect  you
[14:07] 
[14:07] know  they  build  plenty  of  housing  but
[14:09] 
[14:09] there's  not  there's  not  as  much
[14:10] 
[14:10] opportunity  there
[14:11] 
[14:11] so  so heading  into  covid  you  just  you
[14:13] 
[14:13] saw  this  incredible  bifurcation  and  you
[14:15] 
[14:15] saw  the  American  economy  and  you  see  it
[14:16] 
[14:16] in  American  politics  where  basically
[14:18] 
[14:18] you're  either  in  a  city  you  buy  a  home
[14:19] 
[14:19] you  know  you've  kind  of  got  got  you've
[14:21] 
[14:21] got  the  whole  commitment  you've  got  that
[14:22] 
[14:22] level  of  opportunity  for  you  and  your
[14:23] 
[14:23] family  right  or  you're  in  a  more  rural
[14:25] 
[14:25] environment  and  you're  basically  stuck
[14:27] 
[14:27] and  you  don't  have  access  to  good  jobs
[14:28] 
[14:28] and  your  kids  are  not  going  to  have  like
[14:29] 
[14:29] high-tech  jobs  and  it's  you  know
[14:31] 
[14:31] basically  it's  you're  going  to  have  a
[14:32] 
[14:32] lower  quality  of  life
[14:33] 
[14:33] um  this  was  becoming  a  very  big  issue
[14:35] 
[14:35] this  become  a  very  big  issue  by  the  way
[14:37] 
[14:37] for  for  us  because  we  were  kind  of  we
[14:38] 
[14:38] were  basically  getting  stuck  in  the
[14:40] 
[14:40] geographic  confines  of  Silicon  Valley
[14:41] 
[14:41] like  we  were  our  companies  were  like
[14:43] 
[14:43] penned  in  and  it  was  becoming  very  hard
[14:44] 
[14:45] for  companies  to  grow  in  that  area
[14:47] 
[14:47] and  then  basically  you  know  a  horrible
[14:48] 
[14:48] tragedy  struck  that  turned  out  to  also
[14:50] 
[14:51] be  in  some  ways  a  miracle  in  terms  of  I
[14:52] 
[14:52] think  the  long  run  consequences  which  is
[14:54] 
[14:54] coven  right  and  you  know  none  of  us
[14:56] 
[14:56] would  have  hoped  that  covet  would  have
[14:58] 
[14:58] would  have  happened  and  it  has  been  a
[14:59] 
[14:59] horrible  tragedy  for  for  many  people  and
[15:01] 
[15:01] I  think  you  know  broadly  for  our  society
[15:03] 
[15:03] but  nevertheless  covid  was  a  System
[15:05] 
[15:05] Shock  right  that  caused  all  big
[15:07] 
[15:07] companies  to  basically  instantly  Move
[15:09] 
[15:09] online  and  a  hard  cut  over  you  know  in
[15:11] 
[15:11] kind  of  a  way  that  I  never  imagined  was
[15:13] 
[15:13] possible
[15:14] 
[15:14] um  it  was  also  an  instant  proof  that
[15:16] 
[15:16] companies  really  can  run  at  least  for
[15:18] 
[15:18] some  time  they  can  actually  run  uh
[15:19] 
[15:19] online  right  basically  like  no  big
[15:22] 
[15:22] company  actually  stopped  operating  as  a
[15:23] 
[15:23] consequence  of  this  dramatic  shift  from
[15:24] 
[15:24] from  in  person  uh  to  online
[15:27] 
[15:27] um  and  then  all  of  a  sudden  like  that
[15:29] 
[15:29] opened  the  door  to  you  know  every  CEO
[15:31] 
[15:31] every  manager  every  entrepreneur  every
[15:33] 
[15:33] investor  thinking  oh
[15:35] 
[15:35] um  okay  the  post-covered  world  is  not
[15:37] 
[15:37] going  to  be  like  the  free  coveted  world
[15:38] 
[15:38] the  post-covered  world  is  going  to  be  an
[15:40] 
[15:40] opportunity  to  rethink  and  reinvent  how
[15:42] 
[15:42] companies  are  organized  it's  going  to  be
[15:43] 
[15:43] an  opportunity  to  reinvent  how
[15:44] 
[15:44] Industries  are  organized  it's  going  to
[15:46] 
[15:46] be  an  opportunity  to  reinvent  you  know
[15:47] 
[15:47] how  geography  works  right  what  the  role
[15:50] 
[15:50] of  cities  is  it's  going  to  be  an
[15:51] 
[15:51] opportunity  to  spread  the  economic
[15:53] 
[15:53] activity  from  cities  much  more  broadly
[15:55] 
[15:55] you  know  potentially  throughout  the
[15:56] 
[15:56] country
[15:57] 
[15:57] um  you  know  every  employer  every  company
[15:59] 
[15:59] every  CEO  here  you  know  is  is  having
[16:01] 
[16:01] some  version  of  this  conversation  you
[16:02] 
[16:02] know  with  their  own  company  we  talk
[16:03] 
[16:03] about  this  with  our  Founders  all  the
[16:05] 
[16:05] time
[16:06] 
[16:06] um  and  then  there's  the  corresponding
[16:07] 
[16:07] question  that's  opened  up  which  is  how
[16:08] 
[16:08] are  people  going  to  live
[16:10] 
[16:10] um  and  some  people  are  going  to  continue
[16:11] 
[16:11] living  the  way  that  they  were  and  some
[16:13] 
[16:13] people  are  going  to  undertake  a  radical
[16:14] 
[16:14] change  in  how  they  live  and  they're
[16:15] 
[16:15] gonna  you  know  they're  gonna  go  they'll
[16:16] 
[16:16] go  remote  and  all  of  a  sudden  you  know
[16:18] 
[16:18] you  go  remote  and  you  have  access  to  you
[16:20] 
[16:20] know  thousands  of  jobs  anytime  you  want
[16:21] 
[16:21] which  is  a  totally  new  phenomenon
[16:24] 
[16:24] um  and  then  there  you  now  have  the
[16:26] 
[16:26] opportunity  to  rethink  how  how  families
[16:27] 
[16:27] live  right  and  so  you  know  is  it
[16:29] 
[16:29] necessary  for  ambitious  kids  to  leave  a
[16:31] 
[16:31] place  where  they  grew  up in  order  to
[16:33] 
[16:33] have  access  to  first-class  Economic
[16:34] 
[16:34] Opportunity  in  2019  he  asked  her that
[16:37] 
[16:37] was  frequently  yes  today  maybe  not
[16:39] 
[16:39] um  and  so  and  and  I  should  also  say  like
[16:41] 
[16:41] it  there's  no  like  this  is  not  a  zero  or
[16:43] 
[16:43] 100  thing  this  is  not  like  a  hard  cut
[16:45] 
[16:45] over  it's  not  like  the  whole  world  goes
[16:46] 
[16:46] remote  or  stays  remote  right  which  is
[16:48] 
[16:48] not  what's  happening  but  there's  this
[16:49] 
[16:49] moment  in  time  that  we're  in  right  now
[16:50] 
[16:50] which  is  like  we  can  actually  we  can
[16:52] 
[16:52] rethink  and  reinvent  how  companies  are
[16:54] 
[16:54] organized
[16:55] 
[16:55] um and  how  work  happens  and  then  we  can
[16:56] 
[16:56] also  reinvent  how  people  how  people  live
[16:58] 
[16:58] and  give  people  a  lot  more  options  and
[16:59] 
[16:59] how  that  happens
[17:00] 
[17:00] um  and  so  I  I  think  basically  the
[17:02] 
[17:02] presumptions  that  have  underlied  the
[17:03] 
[17:03] whole  structure  of  how  the  housing
[17:05] 
[17:05] market  works  and  how  the  industry  works
[17:07] 
[17:07] and  how  people  live  and  work  I  think
[17:08] 
[17:09] it's  basically  all  it  for  grabs  I  think
[17:10] 
[17:10] we  have  about  a  five-year  window  I  think
[17:12] 
[17:12] as  a  society  to  kind  of  figure  out  what
[17:13] 
[17:13] this  means  and  how  to  adapt  um  yeah  let
[17:16] 
[17:16] me  pause  there  that  was  awesome
[17:18] 
[17:18] um  perfect  answer
[17:20] 
[17:20] which  is  a  good  it's  a  good  segue  to
[17:22] 
[17:22] where  I  want  to  go  into  which  is  uh  we
[17:24] 
[17:24] we  have  seen  work  become  more  Dynamic
[17:26] 
[17:26] people  now  sometimes  go  into  an  office
[17:28] 
[17:28] some  days  a  week  sometimes  they  go  in
[17:30] 
[17:30] for  a  couple  months  and  they  go  to  a
[17:31] 
[17:31] different  office  a  different  city
[17:33] 
[17:33] um  you  know  like  we  work  with  quite
[17:35] 
[17:35] equipped  for  this  kind  of  dynamic  work
[17:37] 
[17:37] lifestyle  what  are  the  lessons  that  you
[17:39] 
[17:39] have  learned  from  wework  that  you're
[17:41] 
[17:41] going  to  apply  to  flow  or  things  that
[17:43] 
[17:43] maybe  you  didn't  you  didn't  do  it  we
[17:45] 
[17:45] worked  but  you  thought  about  that  you're
[17:46] 
[17:46] going  to  apply  to  flow  particularly
[17:48] 
[17:48] around  sort  of  this  changing  way  people
[17:50] 
[17:50] live  and  work  and  how  people  as  we  get
[17:52] 
[17:52] to  rethink  the  way  that  we  sort  of
[17:54] 
[17:54] organize  ourselves  and  and  bring
[17:56] 
[17:56] ourselves  to  to  work  into  home
[17:58] 
[17:58] so
[18:00] 
[18:00] I  think  you're  right  I  actually  think
[18:01] 
[18:01] flexible  work  is  more  relevant  today
[18:03] 
[18:03] than  10  years  ago  so  I  actually  think
[18:05] 
[18:05] it's  a  better  idea  today  than  it  was
[18:08] 
[18:08] the  obvious  lesson  is  community  I  think
[18:11] 
[18:11] Corona  I  think  on  top  of  everything  that
[18:12] 
[18:12] Mark  just  said  and  I'm  not  going  to
[18:13] 
[18:13] repeat  any  of  it  but  but  that's  the  data
[18:15] 
[18:15] that  pushed  us  into  being  as  interested
[18:17] 
[18:17] as  we  were  in  this  category  but  on  top
[18:20] 
[18:20] of  all  of  that  we  for  a  lot  of  time  I
[18:22] 
[18:22] think  a  lot  of  people  argued  Howard
[18:24] 
[18:24] Schultz  used  to  say  Starbucks  is  the
[18:25] 
[18:25] third  place  I  remember  once  having  an
[18:27] 
[18:27] argument  with  him  I  told  him  we  work  as
[18:29] 
[18:29] the  third  place  it  was  like  Starbucks  is
[18:31] 
[18:31] the  third  place  well  I  think  the  first
[18:33] 
[18:33] place  turned  out  to  be  the  third  place  I
[18:35] 
[18:35] think  the  home  is  the  most  important
[18:37] 
[18:37] thing  I  think  covert  taught  us  that  I
[18:39] 
[18:39] think  you  can  take  your  your  work  into
[18:43] 
[18:43] your  home  but  you  can  take  your  home
[18:44] 
[18:44] into  your  work  and  that's  affecting  a
[18:46] 
[18:46] lot  of  change  also  to  put  the  little
[18:47] 
[18:47] numbers  behind  what  Mark  is  saying  70  of
[18:50] 
[18:51] 35  year  olds  and  youngers  are  currently
[18:53] 
[18:53] renters  they  don't  actually  buy  and  this
[18:56] 
[18:56] number  is  not  because  of  the  interest
[18:57] 
[18:57] rates  that  have  been  going  up  over  the
[18:58] 
[18:58] past  six  to  ten  months  this  is  a  number
[19:01] 
[19:01] from  12  months  ago  and  we  believe  that
[19:03] 
[19:03] that  number  is  actually  only  gonna  grow
[19:05] 
[19:05] so  70  percent  are  renters  you  said  it's
[19:07] 
[19:07] a  big  piece  of  their  spend  it's  about  a
[19:09] 
[19:09] third  of  their  total  wallet  so  you  have
[19:12] 
[19:12] this  huge  asset  class  largest  in  the
[19:14] 
[19:14] world  70  of  its  users  are  renters  it's  a
[19:17] 
[19:17] third  of  their  spend  and  yet  they're  not
[19:19] 
[19:19] getting  an  experience  that  is  actually
[19:21] 
[19:21] up  to  par  not  to  talk  about  the
[19:23] 
[19:23] financial  you  mentioned  mark  that
[19:24] 
[19:24] they're  not  creating  an  equity  and
[19:26] 
[19:26] they're  not  creating  any  equity  and  when
[19:27] 
[19:27] you  put  those  two  things  together  you
[19:29] 
[19:29] see  a  real  Challenge  and  what  it's  going
[19:30] 
[19:30] to  do  and  we're  already  saying  it  people
[19:32] 
[19:32] are  starting  to  work  where  they  live  and
[19:35] 
[19:35] not  just  live  where  they  work  and
[19:36] 
[19:36] therefore  you're  starting  to  see  these
[19:38] 
[19:38] movements  between  cities  and  you  can
[19:40] 
[19:40] even  say  without  becoming  too  political
[19:42] 
[19:42] but  we're  in  the  heart  of  politics  maybe
[19:44] 
[19:44] some  of  the  results  in  midterms  now
[19:45] 
[19:45] showed  Democrats  that  were  actually
[19:47] 
[19:47] traveling  to  new  cities  and  moving  to
[19:49] 
[19:49] different  places  a  lot  of  things  are
[19:51] 
[19:51] shifting  and  the  way  we  live  has  an
[19:53] 
[19:54] opportunity  right  now  to  change  because
[19:55] 
[19:55] I  think  if  we  weren't  clear  about  it
[19:57] 
[19:57] before  how  important  the  home  is
[19:59] 
[19:59] everybody  is  reminded  and  a  great  home
[20:02] 
[20:02] and  a  great  experience  an  elevated
[20:03] 
[20:03] experience  is  more  important  than  ever
[20:05] 
[20:05] before  and  then  work  has  talked
[20:08] 
[20:08] accommodate  and  Mark  and  I  actually
[20:10] 
[20:10] think  see  the  world  a  little  differently
[20:11] 
[20:11] about  what  if  our  is  every  company  going
[20:14] 
[20:14] to  be  a  remote  company  or  in-person
[20:16] 
[20:16] company  but  the  answer  is  obviously
[20:17] 
[20:17] hybrid  of  the  two  and  as  you  think
[20:20] 
[20:20] through  well  harm  I'm  going  to  solve
[20:22] 
[20:22] work  and  how  am  I  going  to  solve  the
[20:23] 
[20:23] future  of  way  people  live  what  I  see  is
[20:26] 
[20:26] an  opportunity  to  really  affect  that
[20:28] 
[20:28] change  and  it's  exciting  that  we're  in
[20:30] 
[20:30] DC  because  this  is  one  of  the  places
[20:32] 
[20:32] where  opportunities  like  this  become  a
[20:34] 
[20:34] reality  if  I  could  put  you  put  put  a  put
[20:37] 
[20:37] a  point  on  something  that  Adam  said  so
[20:38] 
[20:38] the  you  know  there's  sort  of  this
[20:39] 
[20:39] there's  Richard  Florida  uh  to  analyzes
[20:42] 
[20:42] these  things  talks  about  he  calls  the
[20:43] 
[20:43] creative  class  it's  kind  of  you  know  the
[20:44] 
[20:44] sort  of  say  upper  middle  class  you  know
[20:46] 
[20:46] it's  it's  us  it's  our  kids  right  um  uh
[20:49] 
[20:49] it's  it's  sort  of  you  know  Highly
[20:51] 
[20:51] Educated  you  know  kids  who  are  going  to
[20:52] 
[20:52] basically  go  into  a  knowledge  or  create
[20:53] 
[20:53] a  profession  of  some  kind  right  work
[20:55] 
[20:55] work  work  at  a  keyboard  as  opposed  to
[20:56] 
[20:56] you  know  with  their  doing  doing  some
[20:58] 
[20:58] form  of  manual  labor  manufacturing  and
[20:59] 
[20:59] of  course  you  know  this  is  not  most  of
[21:01] 
[21:01] the  economy  but  this  is  sort  of  the  you
[21:02] 
[21:02] know  kind  of  the  upper  middle  class  um
[21:04] 
[21:04] you  know  in  many  ways  the  cultural
[21:05] 
[21:05] Vanguard  for  the  you  know  for  the
[21:06] 
[21:06] country  you  know  they  Define  a  lot  of
[21:08] 
[21:08] the  trends  and  so  there's  this
[21:10] 
[21:10] experience  right  that  I'm  sure  a  lot  of
[21:12] 
[21:12] us  have  had  and  a  lot  of  a  lot  of  a  lot
[21:14] 
[21:14] of  younger  people  we  know  have  had  in
[21:15] 
[21:15] the  last  especially  20  years  you  know
[21:17] 
[21:17] really  really  20  25  years  the  sort  of
[21:19] 
[21:19] thing  where  you  you  know  you're  growing
[21:21] 
[21:21] up  at  home  you  you  then  go  to  college
[21:23] 
[21:23] you  you  spend  your  time  at  College  you
[21:25] 
[21:25] know  for  or  more  years
[21:28] 
[21:28] um  and  you  know  you're  on  this  campus
[21:30] 
[21:30] environment  and  it's  you  know  and
[21:31] 
[21:31] everybody  knows  like  college  is  kind  of
[21:32] 
[21:32] education  it's  kind  of  adult  they  care
[21:35] 
[21:35] um you  know
[21:36] 
[21:36] um  you  know  it's  got  all  the  it's  gotten
[21:37] 
[21:37] all  the  food  and  entertainment  it's  got
[21:38] 
[21:38] this  whole  contained  environment  it's  a
[21:40] 
[21:40] social  environment  it's  a  dating
[21:41] 
[21:41] environment  right  it's  kind  of  this  this
[21:43] 
[21:43] whole  thing
[21:44] 
[21:44] um  you  know  you're  putatively  you're  an
[21:46] 
[21:46] adult  but  you're  living  in  a  dorm  and
[21:47] 
[21:47] there's  like  a  older  adult  down  the  hall
[21:49] 
[21:49] who's  taking  care  of  you  right  so  you're
[21:51] 
[21:51] not  really  fully  an  adult
[21:53] 
[21:53] um  and  so  you're  in  that  environment  and
[21:55] 
[21:55] of  course  you  know  in  you  know  50  years
[21:56] 
[21:56] ago  you'd  leave  that  environment  and
[21:58] 
[21:58] you'd  you  know  go  to  work  in  an  office
[21:59] 
[21:59] you'd  buy  a  you  know  you'd  buy  a  starter
[22:00] 
[22:00] house  and  you'd  be  on  your  you  know  sort
[22:02] 
[22:02] of  traditional  American  middle  class
[22:03] 
[22:03] path
[22:04] 
[22:04] over  the  last  20  25  years  it  became  very
[22:07] 
[22:07] common  to  have  this  idea  of  the
[22:08] 
[22:08] corporate  campus  right  and  and  you  know
[22:10] 
[22:10] sort  of  Google  maybe  you  know  really
[22:12] 
[22:12] kind  of  you  know  crystallized  that  in
[22:13] 
[22:13] the  in  the  culture
[22:15] 
[22:15] um you  know  basically  this  idea  that  the
[22:17] 
[22:17] company's  facility  where  everybody  came
[22:19] 
[22:19] every  day  was  going  to  basically  be  a
[22:20] 
[22:20] continuation  of  the  college  campus
[22:22] 
[22:22] experience
[22:23] 
[22:23] um  and  and  that  led  to  kind  of  this  you
[22:25] 
[22:25] know  perk  Bonanza  right  so  you'd  have
[22:26] 
[22:26] this  whole  thing  go  to  his  campus  and
[22:28] 
[22:28] it's  like  gourmet  food  24  hours  a  day
[22:29] 
[22:29] and  it's  like  they'll  do  your  dry
[22:30] 
[22:30] cleaning  and  they'll  walk  your  dog  and
[22:31] 
[22:31] there's  you  know  swimming  pools  and
[22:32] 
[22:32] there's  the  thing  you  know  by  the  way
[22:34] 
[22:34] you  know  these  campuses  still  exists
[22:36] 
[22:36] they're  all  100  converting  all  their
[22:37] 
[22:37] tennis  courts  to  pickleball  courts
[22:39] 
[22:39] because  of  course  that's  what
[22:39] 
[22:39] everybody's  doing  right  so  so  there  are
[22:42] 
[22:42] these  you  know  it  basically  a
[22:43] 
[22:43] self-contained  environment  and  the
[22:44] 
[22:44] theory  of  it  right  was  if  we  can  get
[22:46] 
[22:46] people  you  know  especially  these  young
[22:47] 
[22:47] people  like  inculcate  them  keep  them  in
[22:49] 
[22:49] this  kind  of  college  campus  kind  of
[22:50] 
[22:50] environment  then  they'll  basically
[22:51] 
[22:51] they'll  work  more  right  we'll  get  more
[22:52] 
[22:52] out  of  them  because  they'll  they'll  be
[22:54] 
[22:54] here  more  often
[22:55] 
[22:55] um you  know  it's  basically  everything  up
[22:57] 
[22:57] to  not  usually  including  the  actual  bed
[23:00] 
[23:00] um  although  sometimes  people  would  sleep
[23:01] 
[23:01] under  their  desk
[23:02] 
[23:02] um  like  like  Elon  Musk  um
[23:05] 
[23:05] but  everything  you  know  sort  of  short  of
[23:06] 
[23:06] that  um and  so  as  a  consequence  you'd
[23:08] 
[23:08] have  this  thing  where  sort  of  young
[23:09] 
[23:09] adults  kind  of  stayed  in  this  corporate
[23:10] 
[23:10] campus  environment  and  then  as  a
[23:11] 
[23:11] consequence  they  had  this  incredible
[23:13] 
[23:13] Community  right  they  had  this  incredible
[23:16] 
[23:16] environment  right  where  they  have  you
[23:17] 
[23:17] know  all  these  friends  co-workers
[23:18] 
[23:18] colleagues  you  know  their  you  know  their
[23:20] 
[23:20] teammates  other  people  who  work  at  the
[23:22] 
[23:22] same  company  they're  going  to  lunch
[23:23] 
[23:23] going  to  dinner  doing  the  whole  thing
[23:25] 
[23:25] and  then  and  then  by  the  way  it  also
[23:26] 
[23:26] turns  out  it's  that  it's  it's  just  like
[23:27] 
[23:27] the  college  campus  it's  the  dating  pool
[23:29] 
[23:29] um  right  um  and  so  you  know  it's  you
[23:32] 
[23:32] know  basically  if  you  work  for  you  know
[23:33] 
[23:33] for  the  Google  campus  or  the  Facebook
[23:34] 
[23:34] campus  like  where  you're  gonna  date
[23:35] 
[23:36] probably  somebody  who  also  is  there
[23:37] 
[23:37] because  you're  there  all  the  time
[23:38] 
[23:38] together  and  then  you  basically  like
[23:40] 
[23:40] Drop  covet  into  that  model  and  you  just
[23:42] 
[23:42] like  detonate  it  right  which  is  which
[23:44] 
[23:44] which  is  what's  happened  right  and  then
[23:45] 
[23:45] all  of  a  sudden  the  experience  of  a  kid
[23:47] 
[23:47] going  through  that  all  of  a  sudden  it's
[23:48] 
[23:48] like  nope  nope  you  don't  get  that  what
[23:49] 
[23:49] you  get  is  you  get  to  sit  in  your  studio
[23:51] 
[23:51] apartment  right  in  front  of  your  laptop
[23:53] 
[23:53] right  and  good  luck  right  and  you're
[23:54] 
[23:54] like  cut  off  from  everything  else  and
[23:56] 
[23:56] like  you've  got  doordash  but  and  you've
[23:57] 
[23:57] got  Tinder  and  like  that's  your  life  and
[23:59] 
[23:59] like
[24:00] 
[24:00] that  is  not  the  same  thing
[24:03] 
[24:03] um  and  so  and  then  you  know  to  Adam's
[24:05] 
[24:05] Point  like  a  lot  of  these  companies  now
[24:06] 
[24:06] are  thinking  okay  we're  gonna  have
[24:07] 
[24:07] people  come  back  in  the  office  two  days
[24:08] 
[24:08] a  week  three  days  a  week  and  we're  gonna
[24:10] 
[24:10] have  them  come  back  and  chance  or  this
[24:11] 
[24:11] or  that  but  you  know  this  the  spirit  is
[24:13] 
[24:13] like  Elvis  has  left  the  building  for  the
[24:14] 
[24:14] for  these  kinds  of environments  like
[24:16] 
[24:16] this  is  not  the  way  that  most  companies
[24:17] 
[24:17] are  going  to  operate
[24:19] 
[24:19] um  and  so  all  of  a  sudden  the  focus  on
[24:21] 
[24:21] where  you  live  the  focus  on  what  you
[24:23] 
[24:23] know  are  you  literally  by  yourself  you
[24:25] 
[24:25] know  do  you  have  roommates  are  you  in  a
[24:27] 
[24:27] small  you  know  complex  are  you  in  a  big
[24:29] 
[24:29] complex  do  you  do  you  have  any  sense  of
[24:31] 
[24:31] connection  whatsoever  do  you  know  who
[24:32] 
[24:33] your  neighbors  are  you  know  most  people
[24:34] 
[24:34] historically  live  in  apartments  I  don't
[24:36] 
[24:36] think  they  generally  would  even  know  who
[24:37] 
[24:37] their  neighbors  are  right  the  guy  next
[24:38] 
[24:38] door  is  just  the  guy  next  door  you  you'd
[24:40] 
[24:40] feel  no  connection
[24:41] 
[24:42] um  by  the  way  there  would  be  no  overlap
[24:43] 
[24:43] where  you  lived  and  the  people  you
[24:44] 
[24:44] worked  with  would  have  no  overlap  right
[24:46] 
[24:46] because  there  was  no  point  you  didn't
[24:47] 
[24:47] worry  about  whether  there  were  other
[24:48] 
[24:48] people  who  you  worked  with  who  were  in
[24:49] 
[24:49] your  same  apartment  complex  because  you
[24:51] 
[24:51] were  seeing  them  at  work  all  day  and  so
[24:53] 
[24:53] do  you  have  anything  in  common  with  the
[24:54] 
[24:54] people  you're  in  the  building  with
[24:56] 
[24:56] um  and  so  so  there's  this  there's  this
[24:57] 
[24:57] sort  of  whole  model  that  an  entire
[24:59] 
[24:59] generation  grew  up  with  that  has  all  of
[25:01] 
[25:01] a  sudden been  detonated  and  I  I  yeah  and
[25:03] 
[25:03] I  I  don't  know  it  may  be  political  I
[25:05] 
[25:05] think  the  idea  of  sitting  in  the
[25:06] 
[25:06] apartment  in  front  of  the  screen  with
[25:07] 
[25:07] doordash  and  Tinder  is  not  a  good  life
[25:09] 
[25:09] um  and  so  that  that  opens  the  door  for
[25:11] 
[25:11] reinvention  we  don't  we  don't  think  we
[25:13] 
[25:13] know  it's  not  a  good  life  because  we've
[25:15] 
[25:15] even  in  the  office  so  you  gave  Google  as
[25:17] 
[25:17] an  example  Google  was  inspiration  for  us
[25:19] 
[25:19] that  we  work  our  point  was  well  why
[25:21] 
[25:21] can't  small  businesses  have  this  great
[25:22] 
[25:22] campus  have  this  great  energy  and  that
[25:24] 
[25:24] was  the  beginning  I  remember  when  we
[25:26] 
[25:26] tried  to  sell  Google  but  like  can  we  we
[25:28] 
[25:28] could  take  some  of  your  stuff  they're
[25:29] 
[25:29] like  you  can't  take  our  stuff  we're
[25:30] 
[25:30] Google  we  invented  this  we  ended  up
[25:32] 
[25:32] taking  some  of  their  stuff  and  quite  a
[25:35] 
[25:35] lot  actually  but
[25:37] 
[25:37] um  they  they
[25:39] 
[25:39] that  same  Serendipity  feeling  that  you
[25:42] 
[25:42] feel  when  you  go  when  you  were  to  go  in
[25:44] 
[25:44] an  office  and  connect  to  this  belongs  in
[25:46] 
[25:46] a  home  in  a  funny  way  way  more  than  it
[25:48] 
[25:48] ever  belonged  in  an  office  and  when  you
[25:50] 
[25:50] think  of  these  apartment  buildings  and
[25:51] 
[25:51] it  is  a  little  sad  it's  sad  that  there's
[25:53] 
[25:53] an  apartment  building  with  400
[25:55] 
[25:55] apartments  maybe  six  seven  hundred
[25:56] 
[25:56] people  with  a  swimming  pool  and  a
[25:58] 
[25:58] kitchen  and  a  gym  and  all  these
[25:59] 
[25:59] amenities  did  when  you  if  anybody  here
[26:01] 
[26:01] has  ever  been  in  a  multi-family  you  do
[26:03] 
[26:03] this  amazing  tour  they  show  you  all
[26:04] 
[26:04] these  amenity  spaces  you  never  see
[26:06] 
[26:06] anyone  there  you  then  move  into  the
[26:08] 
[26:08] building  and  you  not  everyone  but  a  lot
[26:10] 
[26:10] of  people  live  their  life  that  Mark  is
[26:12] 
[26:12] describing  and  that's  sad  because  I
[26:14] 
[26:14] don't  think  human  connection  thrives  I
[26:16] 
[26:16] actually  think  I'm  so  happy  we're  here
[26:17] 
[26:17] face  to  face  and  covet  was  obviously  a
[26:20] 
[26:20] horrible  thing  but  also  a  miracle  at  the
[26:22] 
[26:22] same  time  it's  a  miracle  that  we're  all
[26:24] 
[26:24] here  face  to  face  because  this
[26:25] 
[26:25] connection  is  so  much  more  meaningful
[26:27] 
[26:27] and  why  doesn't  why  don't  people  deserve
[26:31] 
[26:31] that  in  the  home  and  again  I  go  back  to
[26:32] 
[26:32] that  number  it's  a  third  of  their  wallet
[26:34] 
[26:34] spent  as  the  Americans  were  used  to
[26:36] 
[26:36] actually  for  anything  we  spend  if  it's
[26:38] 
[26:38] two  percent  of  our  world  spend  one
[26:39] 
[26:39] percent  of  our  wallet  spend  many
[26:41] 
[26:41] companies  that  you  guys  invest  in  it's
[26:43] 
[26:43] all  branded  it's  always  an  uplifting
[26:44] 
[26:44] experience  if  someone  doesn't  do  good
[26:46] 
[26:46] enough  experience  then  the  next  person
[26:47] 
[26:47] comes  and  elevates  it  and  yet  in
[26:50] 
[26:50] residential  and  we  can  talk  about  why
[26:51] 
[26:51] but  in  residential  never  happened  and
[26:54] 
[26:54] because  it  never  happened  and  because
[26:56] 
[26:56] it's  so  difficult  to  disrupt  it  actually
[26:58] 
[26:58] didn't  occur  and  what  ends  up  happening
[26:59] 
[26:59] is  that  renter  is  not  getting  a  good
[27:02] 
[27:02] deal  neither  the  experience  or  the
[27:03] 
[27:03] financial  transaction  and  again  that
[27:05] 
[27:05] renter  is  the  majority  of  the  young
[27:07] 
[27:07] adults
[27:08] 
[27:08] yeah  I  think  covid  was  the  first  time  a
[27:11] 
[27:11] lot  of  people  especially  under  the  age
[27:13] 
[27:13] of  of  40  50  first  time  they  ever  got  to
[27:16] 
[27:16] know  their  neighbors  or  they  never  had
[27:17] 
[27:17] to  and  they're  they're  proxy  for
[27:19] 
[27:19] Community  probably  was  the  workplace  and
[27:21] 
[27:21] like  you  said  we're  never  going  back  to
[27:22] 
[27:22] that  whatever  our  new  normal  is  it's  not
[27:24] 
[27:24] I'm  just  going  to  give  you  a  thought
[27:25] 
[27:25] about  that  it's  an  American  thing  that
[27:27] 
[27:27] they  never  had  to  like  in  other
[27:28] 
[27:28] countries  where  I  grew  up in  Israel
[27:30] 
[27:30] there's  no  such  thing  you  don't  know
[27:31] 
[27:31] your  numbers  when  you  don't  have  sold
[27:32] 
[27:33] you  go  to  your  neighbor's  door  you  knock
[27:34] 
[27:34] on  the  door  they  don't  answer  you  open
[27:36] 
[27:36] the  door  it's  locked  you  know  where  the
[27:38] 
[27:38] key  you  open  it  up  you  go  and  you  take
[27:40] 
[27:40] the  self  you  never  break  it  back  yeah
[27:41] 
[27:41] then  they  go  back  there's  no  Soto  Adam
[27:43] 
[27:43] took  it  and  and  it's  it's  it's  this  it's
[27:46] 
[27:46] this  community  here  we  call  the  police
[27:48] 
[27:48] yeah  yeah  yeah  they  come  in  four  hours
[27:51] 
[27:51] it's  true  or  San  Francisco  maybe  never
[27:54] 
[27:54] yeah  yeah  you  guys  said  they  said  that  I
[27:56] 
[27:56] didn't  say  anything  okay  yeah  but  the
[28:00] 
[28:00] point  is  that's  it's  such  a  natural
[28:02] 
[28:02] thing  for  people  living  together  to
[28:04] 
[28:04] connect  and  yet  we  live  in  a  world  where
[28:06] 
[28:06] even  when  people  are  in  the  same
[28:08] 
[28:08] building  they  don't  talk  to  each  other
[28:09] 
[28:09] in  the  elevator  when  I  came  to  the
[28:11] 
[28:11] United  States  and  used  to  say  hello  to
[28:13] 
[28:13] everyone  in  the  elevator  people  thought
[28:15] 
[28:15] I  was  weird  yeah  and  I  thought  it  was
[28:17] 
[28:17] weird  that  you  wouldn't  say  hello
[28:18] 
[28:18] wouldn't  you  want  to  know  who's  living
[28:20] 
[28:20] there  and  you  know  we  have  a  lot  a  lot
[28:22] 
[28:22] of  little  things  and  we  we  haven't
[28:23] 
[28:23] talked  about  really  flow  yet
[28:26] 
[28:26] there's  a  lot  of  different  ideas  that  we
[28:28] 
[28:28] have  but  the  simple  one  is  when  people
[28:29] 
[28:29] tour  a  building  always  the  the  tour  the
[28:32] 
[28:32] leasing  agent  tells  you  about  all  the
[28:33] 
[28:33] amenities  I  would  like  the  listing  agent
[28:35] 
[28:35] who's  not  even  going  to be  called  the
[28:36] 
[28:36] listing  agent  to  introduce  you  to  a  few
[28:38] 
[28:38] residents  who  actually  like  living  there
[28:40] 
[28:40] let  them  tell  you  why  this  is  a  great
[28:42] 
[28:42] building  and  if  it's  a  fit  for  you  or
[28:44] 
[28:44] not  a  fit  for  you  and  that  tiny  little
[28:45] 
[28:45] thing  I  just  said  is  so  small  and  the
[28:48] 
[28:48] fact  that  it  doesn't  exist  actually  and
[28:50] 
[28:50] a  lot  of  people  ask  me  Adam  how  come
[28:51] 
[28:51] this  didn't  exist  before  it  doesn't
[28:53] 
[28:53] exist  in  my  opinion  because  buildings
[28:55] 
[28:55] are  full  anyway  there's  a  short  of
[28:57] 
[28:57] supplies  we  spoke  a  little  bit  about
[28:59] 
[28:59] zoning  there's  the  numbers  varies  but
[29:02] 
[29:02] between  three  to  five  million  apartments
[29:04] 
[29:04] and  single  family  homes  missing  right
[29:06] 
[29:06] now  in  the  US  and  that  number  Grows  by
[29:08] 
[29:08] hundreds  of  thousands  of  units  a  year
[29:10] 
[29:10] and  so  there's  a  shortage  of  Supply
[29:12] 
[29:12] there's  an  over  demand  and  no  one  really
[29:14] 
[29:14] needed  to  do  it  and  because  the
[29:16] 
[29:16] landlords  didn't  need  to  do  it  it  didn't
[29:17] 
[29:17] happen  and  when  you  think  of  prop  their
[29:19] 
[29:19] companies  and  Technology  I  was  talking
[29:21] 
[29:21] to  Steve  case  before  for  a  second  about
[29:23] 
[29:23] proptech  and  I'm  a  little  bit  about
[29:24] 
[29:24] about  all  the  different  Innovations
[29:26] 
[29:26] when  when  you  think  well  why  haven't
[29:28] 
[29:28] people  solved  this  problem  before  most
[29:30] 
[29:30] popular  companies  come  in  and  sort  of
[29:32] 
[29:32] solve  a  point  solution  they  have  this
[29:34] 
[29:34] one  solution  but  then  they  need  to  take
[29:35] 
[29:36] that  solution  convince  the  landlords
[29:37] 
[29:37] we're  not  even  interested  in  buying
[29:39] 
[29:39] anything  because  they're  making  money
[29:40] 
[29:40] anyway  go  to  these  old  Erp  systems
[29:42] 
[29:42] connect  to  the  back  of  these  systems
[29:44] 
[29:44] then  get  the  users  it's  very  difficult
[29:46] 
[29:46] which  is  why  the  way  we  want  to  tackle
[29:48] 
[29:48] it  is  actually  vertical  I  almost  think
[29:50] 
[29:50] it's  the  only  way
[29:51] 
[29:51] excellent  the  uh  we're  gonna  come  back
[29:54] 
[29:54] to  that  in  the  vertical  software  stock
[29:56] 
[29:56] for  prop  Tech  and  flow  in  a  minute
[29:59] 
[30:00] um Mark  you  know  we  we  came  out  Ben  had
[30:02] 
[30:02] a  big  blog  post  about  how  we've  moved
[30:04] 
[30:04] our  headquarters  to  the  cloud  we  have
[30:06] 
[30:06] decoupled  uh  the  geography  of  the  firm
[30:09] 
[30:09] um so  I  guess  the  first  question  is  like
[30:10] 
[30:11] two  parts  talk  a  little  bit  about  the
[30:13] 
[30:13] thinking  about  moving  to  the  cloud  why
[30:14] 
[30:15] did  we  do  it  and  then  talk  about  how
[30:16] 
[30:16] it's  gone  yeah  and  then  I'll  keep  you
[30:19] 
[30:19] honest  if  I  agree  yeah  so  this  is  yeah
[30:21] 
[30:21] this  has  been  very  dramatic  I  mean  look
[30:22] 
[30:22] for  for  every  employer  every  company
[30:23] 
[30:23] this  has  been  dramatic  we've  had  our
[30:25] 
[30:25] version  of  it  um and  for  us  it's  been
[30:26] 
[30:26] very  dramatic  which  is  we  we  made  a  very
[30:28] 
[30:28] deliberate  decision  when  we  started  our
[30:29] 
[30:29] firm  in  2009  that  we  were  really  deeply
[30:31] 
[30:31] going  to  invest  uh  in  the  office  and  in
[30:33] 
[30:33] particular  in  one  office  and  so  we  were
[30:35] 
[30:35] kind  of  semi-notorious  in  the  industry
[30:36] 
[30:36] for  we  only  ever  had  one  office  the
[30:38] 
[30:38] office  was  in  Menlo  Park  California
[30:41] 
[30:41] um  you  know  this  is  actually
[30:41] 
[30:41] controversial  even  in  the  Bay  Area
[30:43] 
[30:43] because  there  are  lots  of startups  are
[30:44] 
[30:44] actually  in  San  Francisco  lots  of  the
[30:46] 
[30:46] younger  people  who  worked  for  us  lived
[30:47] 
[30:47] up  in  San  Francisco  and  we  said  you  know
[30:48] 
[30:48] it's  our  you  know  and  everybody  every
[30:50] 
[30:50] year  was  like  we  got  to  put  up  an  office
[30:51] 
[30:51] in  San  Francisco  and  we're  like  nope
[30:52] 
[30:52] single  office  everybody's  gonna  be  in
[30:54] 
[30:54] the  office  and  and  the  reason  for  that
[30:56] 
[30:56] was  we  wanted  the  Beehive  you  know
[30:57] 
[30:57] effect  like  we  wanted  people  when  they
[30:59] 
[30:59] walk  in  both  the  people  who  work  for  us
[31:00] 
[31:00] but  also  the  people  who  are  visiting  us
[31:02] 
[31:02] to  really  feel  like  they  were  tapping  in
[31:03] 
[31:03] the  energy  they  were  seeing  lots  of
[31:04] 
[31:04] other  interesting  people  you  know  that
[31:06] 
[31:06] this  was  this  was  the  kind  of
[31:07] 
[31:07] environment  you  know  and  the  kinds  of
[31:09] 
[31:09] people  they  want  they'd  want  to  be
[31:09] 
[31:09] around
[31:10] 
[31:10] so  we  put  a  really  big  emphasis  on  that
[31:13] 
[31:13] um you  know  we  were  in  there  you  know
[31:14] 
[31:14] every  day  all  day  um  working  together
[31:16] 
[31:16] you  know  the  whole  the  whole  thing  the
[31:17] 
[31:17] whole  thing  you  get  from  a  high
[31:18] 
[31:18] functioning  you  know  kind  of  office
[31:19] 
[31:19] environment  and  then  like  everybody  else
[31:21] 
[31:21] in  March  of  2000  like  we  shut  that  down
[31:23] 
[31:23] um  and  we  went  you  know  completely
[31:25] 
[31:25] online
[31:25] 
[31:25] um  and  like  everybody  else  we  were
[31:27] 
[31:27] shocked  that  we  were  able  to  continue  to
[31:28] 
[31:28] run  the  firm  you  know  as  you  know  you
[31:30] 
[31:30] basically  keep  everything  going  uh  you
[31:32] 
[31:32] know  over  over  Zoom
[31:34] 
[31:34] um  and  so  and  slack  and  so  forth  and  so
[31:36] 
[31:36] you  know  kind  of  often  away  we  went
[31:38] 
[31:38] um  we  actually  then  actually  actually
[31:39] 
[31:39] had  an  incremental  process  right  and  you
[31:41] 
[31:41] know  the  two  weeks  to  crush  the  curve
[31:43] 
[31:43] turned  into  two  months  turned  into  two
[31:44] 
[31:45] years  right  it's  not  like  everybody  else
[31:46] 
[31:46] we're  trying  to  figure  out  how  long  this
[31:47] 
[31:47] is  going  to  last  we  start  doing  polls  of
[31:49] 
[31:49] our  employees  and  we  did  like  a  poll
[31:50] 
[31:50] like  six  months  in  and  people  were  you
[31:52] 
[31:52] know  some  people  were  like  I  can't  wait
[31:53] 
[31:53] to  get  back  to  the  office  simply  people
[31:54] 
[31:54] were  like  wow  I  don't  know
[31:56] 
[31:56] um  you  know  12  months  the  numbers  moved
[31:58] 
[31:58] 18  months  the  numbers  moved  and  then  we
[32:00] 
[32:00] had  one  poll  where  it  was  basically  like
[32:02] 
[32:02] 100  of  the  young  parents  were  like  if
[32:04] 
[32:04] you  guys  want  to  go  back  to  the  office
[32:05] 
[32:05] good  luck  we're  getting  different  jobs
[32:08] 
[32:08] um  it's  like  I  get  to  spend  time  with  my
[32:10] 
[32:10] kids  I  get  to  to  be  here  in  the  morning
[32:11] 
[32:11] I  get  to  be  here  at  night  I'm  you  know
[32:13] 
[32:13] by  the  way  I'm  working  at  you  know  I'm
[32:14] 
[32:14] working  from  home  you  know  you  know  12
[32:15] 
[32:15] hours  a  day  or  whatever  I'm  more
[32:17] 
[32:17] productive  than  ever  but  like  I  am  not
[32:18] 
[32:18] going  to  do  the  you  know  two  or  three
[32:20] 
[32:20] hour  daily  commute  you  know  from  South
[32:23] 
[32:23] San  Jose  or  from  you  know  San  Francisco
[32:25] 
[32:25] or  from  the  East  Bay  um  you  know  to  go
[32:27] 
[32:27] to  Menlo  Park  I'm  just  not  going  to  do
[32:28] 
[32:28] it  anymore  and  so  that  that  perked  our
[32:30] 
[32:30] ears  up  because  it's  like  okay  that's
[32:32] 
[32:32] interesting
[32:33] 
[32:33] um  and  then  the  other  conversation  we
[32:34] 
[32:34] had  was  basically  what's  going  to  happen
[32:36] 
[32:36] to  our  companies  into  our  industry  right
[32:38] 
[32:38] and  and  so  it's  certainly  not  the  case
[32:40] 
[32:40] that  all  of  our  companies  are  going
[32:41] 
[32:41] they're  certainly  not  all  going  fully
[32:42] 
[32:42] remote  and  we  actually  have  quite  a  few
[32:44] 
[32:44] companies  that  have  actually  elected  to
[32:45] 
[32:45] actually  stay  very  office  Centric
[32:47] 
[32:47] um  which  is  which  is  actually  a  very
[32:48] 
[32:48] interesting  counter  programming  thing
[32:49] 
[32:49] that  some  people  are  doing  now  but  you
[32:51] 
[32:51] know  generally  speaking  our  companies
[32:52] 
[32:52] were  indicating  that  they  were  going  to
[32:53] 
[32:53] become  more  flexible  and  they  were  going
[32:55] 
[32:55] to  really  start  to  spread  out  um  and
[32:56] 
[32:56] then  the  industry  just  felt  like  it  was
[32:58] 
[32:58] going  to  expand  and  we  were  seeing  you
[32:59] 
[32:59] know  a  lot  of  Founders  who  were
[33:01] 
[33:01] frustrated  being  in  the  Bay  Area  you
[33:02] 
[33:02] know  basically  left  over  this  period  and
[33:04] 
[33:04] they  went  to  other  places  and  they
[33:05] 
[33:05] started  companies  and  and  so  we
[33:07] 
[33:07] basically  decided  like  we  can't  be  in
[33:08] 
[33:08] the  business  of  partnering  with  people
[33:10] 
[33:10] who  are  building  the  future  sure  if
[33:11] 
[33:11] we're  not  living  in  the  future  ourselves
[33:13] 
[33:13] and  so  we  basically  said  we'll  just  do  a
[33:15] 
[33:15] hard  reset  we'll  become  um  you  know  sort
[33:17] 
[33:17] of  uh  say  remote  Centric  or  sort  of
[33:19] 
[33:19] virtual  Centric  I  just  approved  a
[33:21] 
[33:21] request  we  converted  we  we  still  have
[33:23] 
[33:23] our  office  because  it's  not  a  long-term
[33:24] 
[33:24] lease  uh  we  converted  it  to  hoteling
[33:27] 
[33:27] um  and  I  just  signed  off  yesterday  um  on
[33:30] 
[33:30] converting  my  former  office  into  the
[33:31] 
[33:31] apparently  the  new  Lounge
[33:33] 
[33:33] um  so  I'm  very  excited  to  visit  visit
[33:36] 
[33:36] visit  the  the  new  Hangouts  face
[33:39] 
[33:39] um  and  so  uh  basically  what  we  decided
[33:42] 
[33:42] is  you  know  and  so  basically  we're  going
[33:44] 
[33:44] to  keep  we're  going  to  keep  offices
[33:45] 
[33:45] basically  as  as  places  for  people  to  go
[33:47] 
[33:47] when  they  need  a  place  to  work  for  basic
[33:49] 
[33:49] for  teams  to  be  able  to  meet  together
[33:50] 
[33:50] we're  also  actually  letting  our  Founders
[33:51] 
[33:51] use  our  offices  more  which  is  actually
[33:53] 
[33:53] helping  them  figure  out  how  to  kind  of
[33:54] 
[33:54] adapt  through  this
[33:55] 
[33:55] um  and  then  we're  going  to  expand
[33:57] 
[33:57] basically
[33:59] 
[33:59] actually  the  wework  model  being  ahead  of
[34:00] 
[34:00] its  time  we're  going  to  have  more
[34:02] 
[34:02] smaller  offices  and  more  locations  and
[34:04] 
[34:04] so  we've  opened  formally  in  what  do  we
[34:07] 
[34:07] announced  so  far
[34:08] 
[34:08] at  least  five  which  are  the  which  ones
[34:11] 
[34:11] we  announced  La  Menlo  SF  Miami  New  York
[34:15] 
[34:15] New  York  to  New  York  three  uh
[34:20] 
[34:20] uh  I  think  that's  it  for  the  moment  yeah
[34:23] 
[34:23] and  then  we'll  yeah  and  we'll  we'll  have
[34:24] 
[34:24] more  in  the  future  so  we're  yeah  we're
[34:25] 
[34:25] going  to  accommodate  we're  we're  now
[34:27] 
[34:27] we're  we're  a  you  know  we're  we're  not  a
[34:29] 
[34:29] you  know  we're  an  investment  operation
[34:30] 
[34:30] not  a  product  so  we  don't  we  don't  have
[34:32] 
[34:32] like  you  know  assembly  lines  or  software
[34:33] 
[34:33] you  know  kind  of  you  know  production  so
[34:35] 
[34:36] we  have  a  simpler  version  of  the  problem
[34:37] 
[34:37] but  we're  letting  our  teams  decide
[34:39] 
[34:39] basically  how  to  distribute  so  we  have
[34:41] 
[34:41] some  teams  that  want  to  be  in  person  we
[34:42] 
[34:42] have  some  teams  that  want  to  be  remote
[34:43] 
[34:43] and  I  would  say  I  think  it's  gone  so
[34:46] 
[34:46] we're  doing  all  that  so  the  way
[34:47] 
[34:47] basically  the  firm  runs  now  is  we
[34:48] 
[34:48] basically  run  the  firm  remote  like  all
[34:50] 
[34:50] the  formal  meetings  are  on  Zoom
[34:51] 
[34:51] everything  is  kind  of  equalized  um  you
[34:53] 
[34:53] know  kind  of  that  way  um  but  the  teams
[34:55] 
[34:55] are  free  to  Cluster  whenever  they  want
[34:57] 
[34:57] um  and  then  we  have  a  very  big  focus  on
[34:59] 
[34:59] two  things  one  is  off-sites  um  and  so
[35:01] 
[35:01] get  you  know  every  team  is  expected  to
[35:03] 
[35:03] get  together  on  a  frequent  basis  and  we
[35:05] 
[35:05] really  invest  in  that  um  and  then  a  lot
[35:06] 
[35:06] more  travel  and  so  so  I'm  traveling  you
[35:09] 
[35:09] know  I'll  I'll  my  steady  state  I  think
[35:11] 
[35:11] is  going  to  be  traveling  at  like  4X  the
[35:12] 
[35:12] number  of  days  that  I  used  to  travel
[35:14] 
[35:14] um  and  you  know  and  all  of  a sudden
[35:16] 
[35:16] right  it's  even  higher  impact  than  it
[35:17] 
[35:17] used  to  be  to  actually  show  up  someplace
[35:19] 
[35:19] and  actually  be  there  in  person
[35:21] 
[35:21] um  so  for  us  it  feels  like  a  real
[35:22] 
[35:22] broadening  out  of  what  a  firm  like  ours
[35:24] 
[35:24] is  capable  of  doing  it  feels  like  a  way
[35:26] 
[35:26] to  basically  accommodate  scale  um
[35:28] 
[35:28] because  we  definitely  felt  bottlenecked
[35:30] 
[35:30] uh  you  know  where  we  were  um  and  so  I  I
[35:32] 
[35:32] think  it's  a  way  to  run
[35:34] 
[35:34] um  you  know  look  I  think  the  Adam's
[35:35] 
[35:35] Point  like  we're  feeling  our  way  through
[35:36] 
[35:36] it  I  think  a  lot  like  I  would  say
[35:38] 
[35:38] especially  this  I've  talked  to  a  lot  of
[35:39] 
[35:39] big  company  CEOs  and  I  think  they're  all
[35:41] 
[35:41] and  I  think  they  would  generally  agree
[35:43] 
[35:43] with  this  they're  all  in  an  intermediate
[35:44] 
[35:44] state  they're  they're  all  in  some  hybrid
[35:46] 
[35:46] state  where  they  kind  of  have  a  lot  of
[35:49] 
[35:49] vestiges  of  the  old  model  because
[35:50] 
[35:50] they've  got  the  offices  they've  got  and
[35:51] 
[35:51] they've  got  the  employees  that  you  know
[35:53] 
[35:53] lived  in  the  certain  places  but  they've
[35:54] 
[35:54] also  they  know  that  they  can't  go  back
[35:55] 
[35:55] to  the  way  things  used  to  be  so  they've
[35:57] 
[35:57] all  got  some  hybrid  remote  virtual  thing
[35:58] 
[35:58] it's  usually  a  two  or  three  day  week
[36:00] 
[36:00] thing  it's  not  working  really  well
[36:02] 
[36:02] they've  got  you  know  this  big  question
[36:03] 
[36:03] of  do  they  also  hire  remote  employees
[36:05] 
[36:05] because  if  they  do  then  it  brings  up  the
[36:07] 
[36:07] issue  to  the  current  employees  is  why
[36:08] 
[36:08] can't  they  become  remote  and  then
[36:10] 
[36:10] they've  got  you  know  they  basically  all
[36:12] 
[36:12] have  to  reinvent  all  the  communication
[36:13] 
[36:13] flows  all  the  management  systems  and
[36:15] 
[36:15] then  they've  got  this  fundamental
[36:16] 
[36:16] question  for  their  people  especially  all
[36:18] 
[36:18] the  new  hires  right  and  you  know  we're
[36:20] 
[36:20] now  we're  going  to  be  on  five  years  in
[36:21] 
[36:21] here  pretty  quick  and  so  there's  an
[36:22] 
[36:22] entire  generation  of  kids  coming  out  of
[36:24] 
[36:24] school  that  are  going  to  work  for  these
[36:25] 
[36:25] companies  and  they're  going  to  have  a
[36:26] 
[36:26] different  set  of  both  you  know
[36:27] 
[36:27] expectations  and  issues  and  so  this  is
[36:30] 
[36:30] why  I  think  we're  still  at  the  beginning
[36:31] 
[36:31] of  the  change  like  I  think  we're  three
[36:33] 
[36:33] years  into  it  probably  a  10-year  process
[36:34] 
[36:34] and  I  think  the  level  of  reinvention  is
[36:36] 
[36:36] going  to  be  actually  quite  staggering
[36:38] 
[36:38] from  here
[36:39] 
[36:39] yeah  I  think  that's  right  I  think  we've
[36:42] 
[36:42] we've  managed  through  it  very  well  we
[36:43] 
[36:43] actually  materialize  where  we  need  to
[36:45] 
[36:45] and  have  a  lot  more  Face  Time
[36:47] 
[36:48] you  know  I  think  I  mean  I  see  you  all
[36:50] 
[36:50] the  time  uh  outside  the  office  and  I
[36:52] 
[36:52] think  we  get  much  you  get  much  more
[36:53] 
[36:54] concentrated  focused  time  together  to
[36:56] 
[36:56] actually  be  productive  and  it's  like  you
[36:58] 
[36:58] know  the  hallway  track  is  okay  at  the
[37:00] 
[37:00] office  but  it's  a  little  bit  superficial
[37:02] 
[37:02] how  was  your  weekend  what  did  you  do
[37:04] 
[37:04] when  you  go  to  an  offsite  it's  just  much
[37:05] 
[37:05] more  focused  and  conscientious  about
[37:07] 
[37:07] what  is  important  to  us  what  went  well
[37:09] 
[37:09] what  are  we  not  doing  what  do  we  want  to
[37:11] 
[37:11] be  doing  so  my  takeaway  is  that  when  we
[37:13] 
[37:13] are  together  it  actually  is  way  more
[37:15] 
[37:15] productive  you  know  not  that  I  don't
[37:16] 
[37:16] care  about  your  weekend  I  do  care  but  uh
[37:18] 
[37:18] you  know  it's  not  as  important  as
[37:20] 
[37:20] talking  about  the  next  10  years  of  the
[37:21] 
[37:21] firm  yeah  I  call  this  I  call  this  the
[37:23] 
[37:23] barbell  right  so  it's  it's  the  because
[37:24] 
[37:24] everybody  always  asks  what  about  the
[37:25] 
[37:25] water  cooler  moments  and  I'm  like  God  I
[37:27] 
[37:27] hated  the  watercolor  moments  like  I  mean
[37:29] 
[37:29] like  to  have  to  stand  there  and  like
[37:32] 
[37:32] talk  about  the  football  game  like  I  I
[37:33] 
[37:33] can't  I  can't  I  temporary  seems  like  a
[37:36] 
[37:36] wonderful  guy  I  can't  do  this  it's  very
[37:40] 
[37:40] deflating
[37:42] 
[37:42] yeah  I'm  gonna  I'm  gonna  have  to  I'm
[37:44] 
[37:44] gonna  have  to  push  back  my  my  partners  a
[37:47] 
[37:47] little  bit  okay  go  ahead  um
[37:49] 
[37:49] yes  please  go  ahead  for  an  investing
[37:51] 
[37:51] firm  I  accept  and  I  already  said  you
[37:54] 
[37:54] guys  are  not  just  investors  you're
[37:55] 
[37:55] you're  partners  and  businessmen  and
[37:57] 
[37:57] entrepreneur  and  it's  it's  factual
[37:59] 
[37:59] I  strongly  feel  and  and  Mark  as  to
[38:02] 
[38:02] what's  important  about  this  conference
[38:04] 
[38:04] instead  it's  important  to  think  a  little
[38:05] 
[38:05] bit  how  the  future  is  going  to  look  it's
[38:07] 
[38:07] just  an  opinion  I've  been  in  a  few
[38:09] 
[38:09] offices
[38:10] 
[38:10] I  strongly  feel  that  the  serendipitous
[38:14] 
[38:14] connections  those  those  so  the
[38:16] 
[38:16] watercolor  is  boring  they're  interesting
[38:19] 
[38:19] when  you're  building  a  company  and  it's
[38:20] 
[38:21] getting  exciting  and  a  new  idea  is
[38:23] 
[38:23] coming  and  the  whole  team  was  supposed
[38:24] 
[38:24] to  go  home  and  it's  8pm  and  everybody
[38:26] 
[38:26] told  their  husbands  their  wives  and
[38:28] 
[38:28] their  kids  were  being  there  in  30
[38:30] 
[38:30] minutes  and  then  someone  went  to  the
[38:32] 
[38:32] bathroom  sorry  for  the  example  and  comes
[38:34] 
[38:34] back  like  I  have  it  and  they  say  this
[38:36] 
[38:36] thing  that  solves  the  entire  problem  and
[38:39] 
[38:39] everybody  gets  so  excited  and  before  you
[38:41] 
[38:41] know  it  it's  2  am  and  we  just  moved  the
[38:44] 
[38:44] business  forward  not  by  a  week  but  by  a
[38:46] 
[38:46] year  and  now  it's  2  A.M  it's  very  late
[38:48] 
[38:48] everyone's  sleeping  already  well  let's
[38:49] 
[38:49] go  out  and  grab  a  drink  and  now
[38:50] 
[38:50] everybody's  hanging  out  and  before  night
[38:52] 
[38:52] you  just  had  one  of  those  nights  that's
[38:54] 
[38:54] a  month  that's  this  moment  in  the  life
[38:57] 
[38:57] of  a  business  that  then  you  look  back
[38:58] 
[38:58] and  you  say  I  know  that  day  when  it  all
[39:00] 
[39:00] changed
[39:01] 
[39:01] that  special  piece  cannot  happen  on  Zoom
[39:05] 
[39:05] I  think  human  potential  is  in  the  cloud
[39:07] 
[39:07] I  believe  it  but  human  interaction  is
[39:10] 
[39:10] happening  right  here  and  I  actually
[39:12] 
[39:12] think  if  you  look  10  years  forward  the
[39:13] 
[39:13] companies  that  are  going  to  make  the
[39:14] 
[39:14] effort  now  to  be  face  to  face  now  we  can
[39:17] 
[39:17] describe  what  face-to-face  is  there  are
[39:18] 
[39:18] many  ways  to  do  it  but  the  companies
[39:20] 
[39:20] that  are  actually  going  to  do  the
[39:21] 
[39:21] face-to-face  I  think  when  we  look  back
[39:23] 
[39:23] five  years  maybe  even  10  are  going  to  be
[39:25] 
[39:25] the  winners  obviously  I  agree  that  the
[39:27] 
[39:27] huge  ones  who  don't  know  what  to  do  with
[39:28] 
[39:28] themselves  that's  an  opportunity  for
[39:30] 
[39:30] incumbents  to  come  but  when  I'm  thinking
[39:32] 
[39:32] of  startups  and  new  businesses  even
[39:34] 
[39:34] stronger  businesses  with  my  team  we're
[39:36] 
[39:36] fighting  for  that  face-to-face  time  and
[39:38] 
[39:38] and  every  time  we're  together  the  excuse
[39:41] 
[39:41] of  having  this  event  brought  a  few  of  us
[39:43] 
[39:43] together  and  three  things  came  up  about
[39:44] 
[39:44] the  business  is  we're  thinking  about
[39:46] 
[39:46] just  what  we're  going  to  talk  about  and
[39:48] 
[39:48] and  I  think  that's  priceless  now  take
[39:51] 
[39:51] that  because  we  agreed  that  the  office
[39:52] 
[39:52] is  a  challenge  bring  that  back  into  your
[39:54] 
[39:54] home  you're  back  in  that  multi-family
[39:56] 
[39:56] building  why  not  have  those  connections
[39:57] 
[39:57] there  why  shouldn't  you  meet  here  and  it
[39:59] 
[39:59] makes  a  lot  more  sense  for  me  by  the  way
[40:00] 
[40:00] I'll  meet  my  wife  or  my  husband  in  the
[40:02] 
[40:02] apartment  building  when  I  went
[40:04] 
[40:04] downstairs  to  the  pool  than  I  do  in  the
[40:05] 
[40:05] office  so  both  of  those  things  work
[40:07] 
[40:07] really  well  and  from  a  business  point  of
[40:09] 
[40:09] view  I  can  do  business  there  also  and
[40:11] 
[40:11] then  maybe  there  should  be  a  co-working
[40:12] 
[40:12] space  there  should  be  an  office  and
[40:14] 
[40:14] maybe  Enterprises  are  going  to  look  so
[40:16] 
[40:16] if  Enterprises  need  to  do  culture  and  if
[40:18] 
[40:18] culture  is  not  going  to  be  in  the  office
[40:19] 
[40:19] anymore  then  maybe  there's  a  new  hybrid
[40:21] 
[40:21] that  has  to  do  with  the  home  put
[40:23] 
[40:23] together  with  an  office  space  then  I'll
[40:24] 
[40:24] give  one  more  thought  that  I  have  I
[40:26] 
[40:26] think  the  fact  that  you  guys  have  seven
[40:27] 
[40:27] offices  is  the  future  so  I  do  think  it's
[40:30] 
[40:30] smaller  offices  and  centers  but  it's
[40:32] 
[40:32] going  to  be  very  hard  for  me  to  be
[40:34] 
[40:34] convinced  that  not  bringing  people
[40:36] 
[40:36] together  and  not  having  human  connection
[40:37] 
[40:38] is  is  in  our  nature  I  don't  think  we're
[40:41] 
[40:41] built  to  look  at  the  screen  and  I  think
[40:43] 
[40:43] that  the  one  day  when  we're  all  much
[40:45] 
[40:45] much  older  and  we're  second  we're  on  our
[40:47] 
[40:47] deathbed  and  we're  looking  at  ourselves
[40:50] 
[40:50] and  we  have  that  moment  of  realization
[40:51] 
[40:51] and  we  say  well  how  much  time  in  my  life
[40:53] 
[40:53] did  I  spend  with  my  loved  ones  with
[40:55] 
[40:55] people  I  really  care  about  and  how  much
[40:57] 
[40:57] time  of  my  life  did  I  spend  in  front  of
[40:59] 
[40:59] a  screen  if  that  answer  with  front  of
[41:02] 
[41:02] the  screen  is  too  big  I  am  not  sure  how
[41:04] 
[41:04] we're  gonna  feel  that  second  before  it's
[41:05] 
[41:05] all  over
[41:07] 
[41:07] look  I  think  we  would  all  agree  you  have
[41:09] 
[41:09] to  know  what  inning  you're  in  sort  of
[41:10] 
[41:10] what  time  it  is  in  your  company  there's
[41:11] 
[41:11] definitely  moments  that  matter  where  you
[41:13] 
[41:13] all  want  to  be  in  a  room  working
[41:14] 
[41:14] together  and  then  we  do  that  we  would
[41:15] 
[41:15] agree  with  that  for  sure
[41:17] 
[41:17] um  so  actually  let's  talk  about  Adam
[41:19] 
[41:19] you've  kept  a  lot  about  flow  close  to
[41:21] 
[41:21] the  vest  give  us  a  little  bit  about  the
[41:23] 
[41:23] vision  you've  given  us  a  little  hint
[41:24] 
[41:24] throughout  your  answers  here  but  what
[41:26] 
[41:26] are  you  what  are  you  really  hoping  to
[41:27] 
[41:27] build  uh  with  flow  I  actually  thought
[41:29] 
[41:29] because  we  were  talking  so  much  that  I
[41:31] 
[41:31] was  going  to  keep  it  under  my  vest  one
[41:32] 
[41:32] more  day  oh  yeah  well  I  thought  I  was
[41:34] 
[41:34] going  to  get  away  with  it
[41:36] 
[41:36] well  first  of  all  same  reason  about
[41:38] 
[41:38] keeping  it  under  reverse  it's  not  that
[41:40] 
[41:40] we've  actually  been  keeping  it  under  a
[41:41] 
[41:41] vest  it's  that  one  of  the  many  lessons
[41:44] 
[41:44] that  that  we  learned  from  the  past  is
[41:46] 
[41:46] talk  is  cheap  we  just  want  to  build  we
[41:48] 
[41:48] just  wanna  it's  it's  a  heavy  lift  and  we
[41:50] 
[41:51] just  want  to  get  to  work  so  we  had  no
[41:52] 
[41:52] reason  to  say  anything  I  I  met  a  nice
[41:54] 
[41:54] person  here  earlier  today  who  I  think
[41:57] 
[41:57] said  something  about  me  when  he  was
[41:58] 
[41:58] talking  before  and  I  said  you  know
[42:00] 
[42:00] that's  not  true  what  you  said  it  goes
[42:02] 
[42:02] but  that's  what  the  media  said  and  I  was
[42:03] 
[42:03] like  well  I  never  spoke  that's  right  the
[42:05] 
[42:06] media  the  media  is  never  miscarried
[42:07] 
[42:07] against  him  either  he  then  told  me  he
[42:09] 
[42:09] said  you  know  I'm  not  sure  I  buy  into
[42:10] 
[42:10] flow  I  said  well  I  never  spoke  about
[42:12] 
[42:12] that  either
[42:14] 
[42:14] um
[42:15] 
[42:15] in  a  very  simple  way  we  want  to  create
[42:18] 
[42:18] an  elevated  experience  for  the  resident
[42:21] 
[42:21] and  we  want  to  find  a  way  to  share  with
[42:24] 
[42:24] the  resident  a  portion  of  the  value  that
[42:26] 
[42:26] they  create
[42:28] 
[42:28] I'll  give  that  a  moment  we  want  to
[42:30] 
[42:30] elevate  their  experience  we  talked  about
[42:32] 
[42:32] the  buildings  we  talked  about everything
[42:33] 
[42:33] that's  happening  I  actually  think  I
[42:35] 
[42:35] don't  think  it's  an  easy  job  I  think
[42:36] 
[42:36] it's  very  hard  but  I  do  think  the  power
[42:38] 
[42:38] is  low  you  just  make  a  little  more
[42:40] 
[42:40] connections  you  just  make  it  a  little
[42:41] 
[42:41] bit  more  real  you  pay  attention  to  the
[42:43] 
[42:43] people  running  it  you  maintain  it  the
[42:45] 
[42:45] right  way  you  leverage  technology  to
[42:47] 
[42:47] actually  make  things  work  instead  of
[42:48] 
[42:48] using  nine  apps  use  one  you  do  simple
[42:50] 
[42:50] things  and  you  elevate  the  experience
[42:52] 
[42:52] but  then  the  more  complicated  part  is
[42:54] 
[42:54] you  find  a  way  to  share  a  portion  of  the
[42:56] 
[42:56] value  and  with  the  resident  itself
[43:00] 
[43:00] and  because  and  that's  the  vision
[43:03] 
[43:03] and  because
[43:05] 
[43:05] we  said  that  it's  a  majority  of  the
[43:07] 
[43:07] young  adults  and  because  Mark  said  that
[43:09] 
[43:09] that's  how  people  so  a  few  numbers
[43:11] 
[43:11] behind  that  for  80  years  owning  a  home
[43:14] 
[43:14] used  to  be  the  way  that  that  was  the
[43:15] 
[43:15] majority  of  us  creating  a  equity  and  60
[43:19] 
[43:19] of  Americans  today  in  average  their
[43:21] 
[43:21] equities  in  the  home  that  is  the
[43:23] 
[43:23] majority  of  equity  so  if  we're  correct
[43:25] 
[43:25] and  70  are  renters  and  that  number  is
[43:27] 
[43:27] only  going  to  go  up  what  were  they  going
[43:29] 
[43:29] to  create  equity
[43:31] 
[43:31] and  if  they're  going  to  be  renters  for
[43:33] 
[43:33] 10  years  20  years  when  you  go  into  these
[43:35] 
[43:35] apartment  buildings  and  it's  true  about
[43:36] 
[43:36] single  family  but  for  today  we'll  we'll
[43:38] 
[43:38] talk  about  apartments  if  you're  going  to
[43:40] 
[43:40] go  into  these  multi-family  buildings  and
[43:41] 
[43:41] you're  going  to  have  this  disconnected
[43:43] 
[43:43] experience  that  you  just  said  but  you're
[43:44] 
[43:44] not  only  going  to  be  there  for  two  years
[43:45] 
[43:45] and  then  get  married  and  move  to  home
[43:47] 
[43:47] you're  going  to  be  there  for  20.  that
[43:49] 
[43:49] sounds  Soul  crushing  right  and  therefore
[43:52] 
[43:52] you  have  to  solve  both  of  the  sides
[43:55] 
[43:55] can  I  ask  myself  the  next  question  sure
[43:57] 
[43:57] Adam  how  are  you going  to  solve  most  of
[43:59] 
[43:59] this  side  that  sounds  really  good  but
[44:00] 
[44:00] what  are  you  actually  got  a  great  great
[44:01] 
[44:01] question  thank  you  thank  you  for  that
[44:03] 
[44:03] great  question
[44:04] 
[44:04] and
[44:05] 
[44:06] well  we  have  four  pillars  as  we're
[44:09] 
[44:09] looking  at  the  business  today  we  have
[44:11] 
[44:11] the  first  one  which  is  a  branded
[44:13] 
[44:13] technology  first  management  company  that
[44:15] 
[44:15] actually  runs  the  buildings
[44:17] 
[44:17] we  have  an  asset  management  or  real
[44:19] 
[44:19] estate  fund  or  real  estate  company  that
[44:21] 
[44:21] actually  owns  the  buildings  and
[44:23] 
[44:23] something  cool  about  our  new  business  we
[44:25] 
[44:25] actually  own  buildings  together  already
[44:26] 
[44:26] one  of  the  biggest  words  that  Mark  and
[44:28] 
[44:28] Ben  used  as  I  said  before  was  alignment
[44:30] 
[44:30] alignment  alignment  alignment  so  for
[44:33] 
[44:33] perfect  alignment  we  contributed  into
[44:34] 
[44:34] this  business  at  least  as  much  as  as  and
[44:37] 
[44:37] recent  contributed  into  this  business
[44:38] 
[44:38] and  I'm  very  excited  about  it  and  it's
[44:40] 
[44:40] it's  amazing  to  feel  like  that
[44:43] 
[44:43] and  then  we  have  a  financial  services
[44:45] 
[44:45] company  so  number  one  management  company
[44:48] 
[44:48] branded  technology  first  number  two  real
[44:51] 
[44:51] estate  Asset  Management  a  company  that
[44:53] 
[44:53] can  buy  real  estate  and  asset  managed
[44:55] 
[44:55] real  estate  number  three  financial
[44:56] 
[44:56] services  and  the  fourth  pillar  is  this
[44:59] 
[44:59] mechanism  that's  going  to  take  some  of
[45:01] 
[45:01] the  value  and  share  it  with  the  value
[45:02] 
[45:02] creators  and  what  we  get  so  excited
[45:04] 
[45:04] about  the  vision  of  flow  and  The
[45:06] 
[45:06] Business  of  flow  is  that  it's  actually  a
[45:09] 
[45:09] flywheel  if  we  can  actually  create  a
[45:11] 
[45:11] better  experience  in  the  building  then
[45:13] 
[45:13] the  building  performs  better  and  makes  a
[45:15] 
[45:15] higher  noi  if  the  building  makes  a
[45:17] 
[45:17] higher  noi  then  we'll  be  able  to  raise
[45:19] 
[45:19] more  money  and  buy  more  buildings  if  we
[45:21] 
[45:21] buy  more  buildings  then  we'll  be  able  to
[45:23] 
[45:23] run  more  buildings  and  have  more  users
[45:24] 
[45:24] in  those  buildings  and  those  users  are
[45:27] 
[45:27] going  to  start  using  our  financial
[45:28] 
[45:28] services  now  the  reason  they're  going  to
[45:30] 
[45:30] use  the  financial  services  the  first
[45:32] 
[45:32] thing  you  do  in  buildings  is  you  charge
[45:34] 
[45:34] rent  every  month  and  that's  35  of  their
[45:36] 
[45:36] total  wallet  so  that  payments  company
[45:38] 
[45:39] that's  charging  your  rent  already  has  a
[45:40] 
[45:40] real  relationship  with  the  user  if  that
[45:43] 
[45:43] financial  services  company  is  going  to
[45:45] 
[45:45] do  what  we  wanted  to  do  and  create
[45:46] 
[45:46] services  that  are  actually  meaningful
[45:48] 
[45:48] recall  where  you  think  of  it  as
[45:49] 
[45:49] Financial  wellness  and  give  services
[45:51] 
[45:51] that  are  actually  meaningful  then  that
[45:52] 
[45:52] again  is  going  to  drive  more  users  and
[45:54] 
[45:54] then  if  we  are  able  to  take  this  value
[45:57] 
[45:57] creating  mechanism  and  share  with  the
[45:59] 
[45:59] residents  a  portion  of  the  value  it's
[46:02] 
[46:02] going  to  make  them  feel  ownership  and
[46:04] 
[46:04] it's  not  just  ownership  I  feel  like  I'm
[46:05] 
[46:05] part  of  something  it's  I  actually  own
[46:08] 
[46:08] part  of  something  and  again  the  word
[46:09] 
[46:09] ownership  is  a  very  complicated  word
[46:11] 
[46:11] especially  in  this  place  but  if  there  is
[46:14] 
[46:14] perceived  value  and  if  that  value
[46:15] 
[46:15] appreciates  over  time
[46:17] 
[46:17] then  I  feel  like  I'm  part  of  a  community
[46:20] 
[46:20] and  a  very  funny  example  that  we  like  to
[46:22] 
[46:22] give  is  if  you're  in  your  apartment
[46:23] 
[46:23] building  and  you're  a  renter  and  your
[46:25] 
[46:25] toilet  gets  clogged  you  call  the  super
[46:27] 
[46:27] if  you're  in  your  own  apartment  and
[46:29] 
[46:29] you're  and  you  bought  it  and  you  own  it
[46:30] 
[46:30] and  your  toilet  gets  clogged  you  take
[46:32] 
[46:32] the  plunger  and  it's  it's  the  difference
[46:35] 
[46:35] when  feeling  like  you  own  something  to
[46:37] 
[46:37] just  feeling  like  you're  renting  from
[46:38] 
[46:38] being  trans  transactional  to  actually
[46:40] 
[46:40] being  part  of  a  community  and  our  vision
[46:43] 
[46:43] is  to  bring  it  all  together  and  just  one
[46:45] 
[46:45] more  example  of  just  to  put  it  into
[46:46] 
[46:46] numbers  average  churn  in  a  property
[46:50] 
[46:50] Management's  average  churn  in
[46:51] 
[46:51] multi-family  in  this  country  is  50  it
[46:54] 
[46:54] means  the  user  stays  in  average  for  two
[46:56] 
[46:56] years
[46:56] 
[46:57] if  the  user  now  enjoys  their  experience
[46:59] 
[46:59] more  and  feels  like  they  have  a  portion
[47:01] 
[47:01] of  the  value  and  chooses  to  stay  a
[47:02] 
[47:03] little  longer  and  that  average  turn  goes
[47:05] 
[47:05] down  from  50  percent  to  40  percent
[47:07] 
[47:07] without  getting  too  deep  into  the
[47:10] 
[47:10] numbers  the  noi  of  the  building  will  go
[47:12] 
[47:12] up  by  approximately  five  percent  which
[47:14] 
[47:14] increases  the  returns  of  the  building
[47:16] 
[47:16] for  those  LPS  for  the  investors  by  500
[47:19] 
[47:19] basis  points  which  in  real  estate  is  an
[47:21] 
[47:21] unheard  of  number  and  by  tackling  this
[47:25] 
[47:25] challenge  vertically  is  what  flow  is
[47:28] 
[47:28] planning  to  do  and  as  I  said  we're  just
[47:32] 
[47:32] getting  started  excellent  I'm  going  to
[47:35] 
[47:35] wrap  this  up  with  one  with  a  sort  of
[47:37] 
[47:37] common  question  for  both  of  you
[47:39] 
[47:39] are  there  any  model  cities  that  are  sort
[47:41] 
[47:41] of  doing  this  right  from  a  regulatory
[47:43] 
[47:43] standpoint  from  a  building  standpoint
[47:45] 
[47:45] from  a  community  neighborhood  standpoint
[47:47] 
[47:47] and  then  part  two  is  sort  of  what  role
[47:50] 
[47:50] does  government  have  to  play  uh  in  sort
[47:53] 
[47:53] of  facilitating  and  improving  either  you
[47:55] 
[47:55] know  Home  Building  homeowner  ownership
[47:57] 
[47:57] and  all  these  components  so  we'll  start
[48:00] 
[48:00] with  with  Mark  Mark  yeah  well  look
[48:04] 
[48:04] cities  were  stern-ups  at  one  point  right
[48:06] 
[48:06] like  so  every  city  was  a  startup
[48:09] 
[48:09] um  and  you  know  there  you  there's  like
[48:10] 
[48:10] incredible  stories  if  you  go  back  far
[48:12] 
[48:12] enough  like  creation  of  cities  like  Los
[48:13] 
[48:13] Angeles  or  Washington  DC  you  know  for
[48:16] 
[48:16] that  matter
[48:17] 
[48:17] um  you  know  in  the  in  the  20th  century
[48:19] 
[48:19] that  kind  of  went  at  least  in  the  in  the
[48:21] 
[48:21] west  that  kind  of  went  out  of  fashion
[48:22] 
[48:22] became  sort  of  an  intractable  thing  to
[48:24] 
[48:24] try  to  do  you  know  there  were  some
[48:26] 
[48:26] entrepreneurs  who  thought  hard  about  it
[48:27] 
[48:27] and  gave  shots  at  it  so  Walt  Disney
[48:29] 
[48:29] right  had  a  whole  you  know  Walt  Disney
[48:30] 
[48:30] had  a  whole  Vision  um  you  know  what  you
[48:32] 
[48:32] know  the  Disney  company  to  this  day  has
[48:33] 
[48:33] these  you  know  planned  communities  that
[48:35] 
[48:35] kind  of  come  from  that  uh  you  know  Walt
[48:37] 
[48:37] Disney  actually  had  this  vision  for  they
[48:38] 
[48:38] actually  have  this  thing
[48:40] 
[48:40] um called  the  Epcot
[48:41] 
[48:41] um  experimental  prototype  city  of
[48:43] 
[48:43] tomorrow
[48:44] 
[48:45] um  and  stayed  in  the  museum  in  San
[48:46] 
[48:46] Francisco  if  you  go  to  the  museum  you
[48:48] 
[48:48] can  see  it  oh  is  that  right  okay  the
[48:49] 
[48:49] whole  thing  well  they  still  I  think  they
[48:51] 
[48:51] still  have  the  Epcot  what  the  part  of
[48:52] 
[48:52] Epcot  that  got  built  I  think  is  still  in
[48:53] 
[48:53] in  Florida  so  you  can  go  visit  I  think
[48:56] 
[48:56] the  remnants  of  Epcot  so  um  you  know
[48:58] 
[48:58] this  is  like  this  is  like  sort  of
[48:59] 
[48:59] futurism  from  the  60s  you  know  kind  of
[49:01] 
[49:01] in  in  in  Disney's  mind  and  he  wasn't
[49:04] 
[49:04] able  to  get  he  passed  away  he  wasn't
[49:05] 
[49:05] able  to  fully  develop  Epcot  but  he  he
[49:07] 
[49:07] was  he  was  kind  of  reaching  in  this
[49:08] 
[49:08] direction  uh  towards  the  end  of  his
[49:10] 
[49:10] career  and  then  you  know  there  are  other
[49:11] 
[49:11] examples  in  the  U.S  you  know  it's
[49:12] 
[49:12] probably  um what  is  it  Irvine
[49:14] 
[49:14] um  you  know  took  a  big  swing  at  this  um
[49:16] 
[49:16] and  actually  it  was  has  been  very
[49:17] 
[49:17] successful  and  then  um  you  know  Venice
[49:20] 
[49:20] uh  Kimmy  you  know  sort  of  you  know
[49:22] 
[49:22] created  the  you  know  La  created  the
[49:23] 
[49:23] Venice  canals  as  a  sort  of  a  plan
[49:25] 
[49:25] commute  so  you  know  there  there  are
[49:26] 
[49:26] various  ideas  like  this  it's  been  a  long
[49:29] 
[49:29] time
[49:30] 
[49:30] since  somebody's  really  taken  a  hard
[49:31] 
[49:31] swing  and  and  so  basically  what  you  have
[49:33] 
[49:33] you  know  basically  what  you  have  are
[49:34] 
[49:34] Legacy  systems  you've  just  got  this  sort
[49:35] 
[49:36] of  entrenched  you  know  complicated  power
[49:37] 
[49:37] you  know  kind  of  system  local  homeowners
[49:40] 
[49:40] I  mean  it  almost  seems  deterministic
[49:42] 
[49:42] that  if  a  city  becomes  successful  it
[49:43] 
[49:43] basically  the  local  homeownership
[49:44] 
[49:45] whatever  political  base  devotes  itself
[49:46] 
[49:46] to  preventing  the  construction  new
[49:48] 
[49:48] housing  and  it  seems  like  a  real  a  real
[49:50] 
[49:50] trap  so  I'll  add  to  what  Mark  is  saying
[49:53] 
[49:53] but  if  a  city  was  a  business  and  it's  an
[49:55] 
[49:55] old  business  and  it's  30  years  old  then
[49:57] 
[49:57] they're  going  to  say  forget  that
[49:58] 
[49:58] business  we're  going  to  start  a  new  one
[50:00] 
[50:00] we're  going  to  fund  it  we're  going  to
[50:01] 
[50:01] start  it  and  we're  gonna  and  we're  gonna
[50:03] 
[50:03] take  over  the  problem  with  cities
[50:05] 
[50:05] they're  built  so  to  go  into  a  city  now
[50:07] 
[50:07] and  change  let's  just  start  with
[50:08] 
[50:08] something  very  simple  most  of  the  city
[50:10] 
[50:10] is  concrete  and  roads  where  cars  are
[50:12] 
[50:12] driving  as  and  there's  so  many  new
[50:14] 
[50:14] Solutions  and  you  can  really  talk  today
[50:15] 
[50:15] about  what's  happening  and  anybody  who
[50:17] 
[50:17] knows  New  York  City  and  so  when  Uber  was
[50:19] 
[50:19] getting  bigger  and  bigger  how  the  yellow
[50:21] 
[50:21] taxes  started  disappearing  was  an
[50:22] 
[50:22] unbelievable  experience  and  how  the
[50:25] 
[50:25] medallions  that  used  to  cost  a  million
[50:26] 
[50:26] three  suddenly  so  it's  it  is  a  very
[50:29] 
[50:29] challenging  thing  to  actually  reimagine
[50:31] 
[50:31] a  city  when  it's  already  built  and
[50:33] 
[50:33] there's  things  you  can  do  it  when  you
[50:34] 
[50:34] look  at  these  buildings  there's  single
[50:35] 
[50:36] standing  Villages  yes  a  building  with
[50:37] 
[50:37] 400  apartments  we  can  reimagine  what
[50:39] 
[50:39] happens  inside  of  it  but  reimagining  a
[50:41] 
[50:42] city  is  a  big  is  a  big  gay  undertaking
[50:44] 
[50:44] and  actually  one  of  the  only  places
[50:45] 
[50:45] actually  in  Saudi  Arabia  where  I  know
[50:47] 
[50:47] some  of  the  team  members  were  just  there
[50:49] 
[50:49] they're  actually  going  for  it  so  there
[50:51] 
[50:51] are  places  in  the  world  right  now  and
[50:53] 
[50:53] and  it's  very  Innovative  and  it's  very
[50:55] 
[50:55] impressive  that  they're  doing  it  that
[50:56] 
[50:56] they  that  people  are  actually  trying  to
[50:59] 
[50:59] build  new  cities  but  the  answer  to  that
[51:01] 
[51:01] and  sort  of  how  government  can  help
[51:02] 
[51:02] there  are  technology  companies  right  now
[51:04] 
[51:04] construction  companies  there  there  are
[51:06] 
[51:06] different  things  there's  there's  a
[51:08] 
[51:08] construction  company  here  called  icon
[51:09] 
[51:09] that's  using  technology  that  the
[51:12] 
[51:12] government  is  going  to  need  to  partner
[51:13] 
[51:13] with  them  at  some  point  because  they
[51:15] 
[51:15] have  found  ways  to  build  a  home  in  four
[51:17] 
[51:17] days  that  used  to  take  that  used  to  take
[51:19] 
[51:19] a  year  and  a  half  and  as  you  can  do  more
[51:22] 
[51:22] and  more  of  those  things  what  we're
[51:23] 
[51:23] gonna  do  is  I  believe  through  Innovative
[51:25] 
[51:25] Technologies  be  able  to  build  it  fast
[51:27] 
[51:27] enough  to  give  people  the  courage  to  go
[51:29] 
[51:29] and  build  a  new  but  to  go  into  the  old
[51:31] 
[51:31] ones  is  very  hard  a  crazy  idea  is  the
[51:34] 
[51:34] office  now  everything  that's  happening
[51:35] 
[51:35] in  office  can  you  go  and  convert  some  of
[51:37] 
[51:37] these  dead  offices  into  some  of  your
[51:38] 
[51:38] dish  you  could  think  about  that
[51:40] 
[51:40] and  I  think  the  role  of  government  has
[51:42] 
[51:42] always  been  very  important  for  this
[51:43] 
[51:43] country  I  think  for  us  that  flow  and
[51:45] 
[51:45] this  is  another  lesson  from  the  past  we
[51:47] 
[51:47] used  to  think  and  I  used  to  think  we  had
[51:49] 
[51:49] to  own  everything  I  think  the  category
[51:51] 
[51:51] is  so  big  that  the  only  way  we're  going
[51:53] 
[51:53] to  achieve  anything  is  through  a
[51:54] 
[51:54] partnership  partnership  with  government
[51:56] 
[51:56] partnership  with  current  players  and
[51:59] 
[51:59] partnership  with  new  players  that  are
[52:00] 
[52:00] going  to  come  and  I  think  it's  the  only
[52:02] 
[52:02] way  to  solve  this  problem  and  I'll
[52:04] 
[52:04] finish  by  saying  that  I  actually  think
[52:05] 
[52:06] the  housing  crisis  that  we  described
[52:08] 
[52:08] might  be  one  of  the  biggest  challenges
[52:10] 
[52:10] that  the  US  is  facing  today  but  the
[52:12] 
[52:12] reason  it's  hard  to  understand  it  it's
[52:13] 
[52:13] because  if  you  really  want  to  get  it
[52:15] 
[52:15] it's  five  to  ten  years  down  the  road  the
[52:17] 
[52:17] problem  with  housing  it  takes  five  to
[52:19] 
[52:19] ten  years  and  Mark  I  agree  with  your
[52:21] 
[52:21] assumption  that  we  have  about  five  years
[52:23] 
[52:23] to  do  something  really  big  about  it  and
[52:27] 
[52:27] all  I  can  tell  you  is  I  think  we  have
[52:29] 
[52:29] the  right  team  to  give  it  a  shot
[52:31] 
[52:31] excellent  uh  well  thank  you  both  uh  for
[52:34] 
[52:34] being  here  this  is  a  great  discussion
[52:35] 
[52:35] we're  gonna  wrap  up  and  get  everyone  out
[52:37] 
[52:37] of  here  and  talk  about  the  party  tonight
[52:38] 
[52:38] thanks  fantastic  thanks  everybody
[52:47] 
[52:47] as  a  reminder  this  conversation  was  part
[52:50] 
[52:50] of  a16z's  American  dynamism  Summit  in
[52:52] 
[52:52] Washington  DC  you  can  find  the  full
[52:54] 
[52:54] library  of  videos  from  the  event  in
[52:56] 
[52:56] November  by  going  to  a16c.com  a  dash
[53:00] 
[53:00] Summit

Transcripción completa

and I just want you to know that it's part of the game to get punched and the question is not are you gonna get back in the game the question is is when back in August after a6c announced our investment into Adam Newman's new company flow it felt like almost everyone whether it was other VCS Founders or journalists had something to say but the one person you didn't hear from was Adam himself and this never shared before footage from our American dynamism Summit back in November Adam sits down with a16c co-founder Mark Andreessen and a 16c venture General partner David ulovich they start by discussing why Adam's chosen to step back into the arena but also why flow that leads into the inevitable conversation around how the pandemic fundamentally shifted both work and home as they touch on a16z's move to the cloud cities as startups and ultimately what it might take to disrupt the world's largest asset class we also get an insights group into how Adam is thinking about the four pillars of flow from technology to financial services finally this video was recently published alongside our full live library of American dynamism Summit recordings which you can find at a16c.com ad-summit [Music] [Music] thank you gentlemen for being here I'm going to just jump right into it those of you that have uh heard Adam and Mark speak know that they have a lot to say and they're very smart so we aren't going to waste any time Adam three years ago you stepped down from your role as CEO of wework one of the most well-known real estate companies ever created you could have sailed off into the sunset a lot of Founders do that hang out in the Mediterranean uh but you decided to start another company again you're not naive you know it's hard you know that there's a lot of attention on you uh so how did you decide that you wanted to Chase and build a new impactful company and uh chase a big vision and dedicate your time to building why why get back in the game get back in the arena first of all thank you for having me thank you Mark thank you David I apologize about the sandals I broke my toe I'm supposed to wear different shoes you know when I stepped down three years ago [Music] the first thing I actually did was I took a moment and I just wanted to take a second and think of the successes but also think of the mistakes and the lessons and all the different things that that I did and that we did as a team and even though I was very proud of what we built I really felt like there was a lot of thinking to do and that was sort of my first thing as that was happening I started building a family office and with my family office we invested in about 50 Venture Investments we did private Equity Investments we did liquid market trading and each one of those things taught me something new that I wasn't aware of before liquid markets actually taught me about Wall Street and as I was sitting with the team and we were doing different investing and listening to earning calls I was like oh wow that's what you guys are listening to and that's what's interesting for you and that gave me a perspective that I didn't have before when I was sitting with entrepreneurs as we did our Venture investing the first part when you invest and write the check is a lot of fun but then comes the part where you're talking to them and listening and they have problems and I got to give advice to these entrepreneurs and they didn't always listen and I was like okay that's how it feels when an entrepreneur is on the list I was like okay I got that and that taught me a lot and actually made me understand Mark and Ben and Venture Capital more and as we're doing all of this and this is now where covet is happening this is March 2020 we were looking at real estate because it's something we care about and we just felt that there was going to be an opportunity in multi-family it was a simple trade it was cap rates were at four eight and we thought they were going to compress and we saw interest rates and we thought there was an opportunity so we decided to go as a as a family office very deep into multi-family we bought approximately 4 000 Apartments and as we're doing that I started walking these buildings and even though initially it was a trade I started feeling like there was something more that can be done I started feeling like the residential experience is not what it should be and just to backtrack this a little bit so going backwards again to 2019 we're stepping down and now it's early 2020 as the whole thing is happening and maybe you wouldn't be surprised but the phone is not ringing as much as it used to be just a few months before I got a phone call from Mark and we never met and Mark introduces himself hello I'm Mark Andrews and I said I know you are mark thank you so much for calling me and he sort of we're having discussion we're talking about something but very quickly turned to Mark asked can we saw Adam how are you doing and I told him this and that and this and that and he says to me oh you're still in that stage and I look I was like this was on the phone I said the mark what stage is that and he goes the stage where you believe everything the media says and I said that well I'm not in that stage and I know we built a great company and of course I don't believe but you know they are saying quite a lot of things and Mark says to me Adam we don't know each other but let me tell you something about venture capital and high growth companies and the bigger the Venture the bigger the growth what I'm about to tell you is more true it's hand-to-hand combat anybody who doesn't know that Ventures hand-to-hand combat doesn't actually understand or has never done it before and when you fight once in a while you get punched and he said I guarantee you because he was very nice he said a lot of our companies use your products not just in the US but all over the world instead I guarantee you that for every mistake you made there's a hundred things that you did right and I just want you to know that it's part of the game to get punched and the question is not are you gonna get back in the game the question is is when and just so you know you have a friend here that you've never met before but we've been tracking even if you ever decide to do anything then then call US and now fast forward well I'll say one more thing about it because it was very meaningful I hung up the phone and I still remember this I walked to Rebecca my wife and I was like I just had the most amazing phone call this guy Martin treason and explained to her who Marcus called me and basically was very encouraging and gave me a different perspective to look at what just occurred and she thought it was amazing and I thought it was amazing and Mark I don't know if I've ever had the chance to actually tell you it was a meaningful moment for me and I really appreciate it and fast forward now a year and a half we kept these buildings that we bought ended up being a really good trade and everything that we thought was happening was happening and we started building this brand it didn't have a name yet but we started building this business and we saw all this opportunity which we'll talk about a little bit later and around February we spoke again and Mark asked me what's up and I told him what was happening and that we've been developing in the business by this point this is over a year old and we've been doing more and more and we started Building Technology and we bought a company and we did a few different things and Mark said that when you come and present it to the team and we went and we met the team and the first thing I noticed when we all met is that the Andreessen Horwitz team was not like the venture capitalist that I was used to and I had quite a lot of experience with Venture Capital before and it didn't feel like investors it actually felt like businessmen like entrepreneurs and I actually asked I just asked mark behind stage I said how many partners do you have that are entrepreneurs and he said 20. and I gotta tell you that's very different from other businesses and as as we're having the discussion one of Mark's Partners asked me Adam are you raising money and I said I'm not sure we're going to build this one on our own I'm not sure because one of our lessons was you got to choose your partners really carefully he said well maybe you should consider us let us look into the business and see if it's interesting and if so maybe we should consider us and then Digi led a very rigorous diligence process and they asked us a lot of questions and learned everything about our business and as we were getting to know Andresen I realized that these are the kind of partners that I was always looking for but never really knew that existed so to answer your question I was always building it but building it with a partner was something that only happened because of this demon because of the way I met them and I could just tell you that we had our first board meeting and one minute afterwards Mark called me and said Adam can I give you some feedback I said of course Mark he said well when your team said this and this and this I don't agree with that let me tell you why and here's the experience I have and here's what I want to warn you from so I welcome the feedback I'm so excited to be a partner I'm excited to be back in the game not alone but with the team and we're just getting started but the future is there's a lot of potential that's that's awesome and I will say on there's a whole bunch of venture capitals in the room and we are all very happy that we work exists so that our portfolio company is not signing these long-term leases in this Dynamic world that we live in and they get to go into the offices they want to be in in the right cities at the right time so what we're going to talk more about flow in the new business in a moment Mark I want to shift to you you know you and I have talked about housing for a long time long long before this investment something you've thought about for a long time why is housing important why is it particularly relevant why is it even part of American dynamism yeah so there's a critique of Silicon Valley in the tech industry that you know on various sometimes I agree with sometimes I don't but um you know there's a critique that basically says look you guys have done a great job you know silicon Valley's done a great job over the years like the really like unimportant things um and so like you know um you know you've consumed electronics and video games and media and e-commerce and like it's all great it's all fine it's all good and by the way like we do those things we're very proud of our efforts in those spaces and we actually think we actually think they're very important but you know they're basically they're small slices of GDP um and then if you look at basically the GDP pie chart which is also the you know sort of consumer spending pie chart the the things that people spend money on that really matter in their lives there's basically three really big ones uh right Healthcare education and housing um and if you look at kind of all the economic statistics by sector Healthcare education housing are basically increasing uh you know in terms of cost you know at a much faster rate than than all the others um and there are the sectors where the the tech industry has had the least impact historically and you know and of those the biggest one is housing right it's sort of the housing is the single biggest uh you know kind of thing that most families spend money on um and so you know it's really Central you know for from from that standpoint um you know it's very Central from a from a from an economic standpoint in the life of a family because right there's this you know very big question which is you know if you you know if if you own there are you know potentially big downsides because you might be stuck you know in one place where maybe you don't want your family to be for the next 30 years because maybe opportunity shifts around um you know but if you rent you don't necessarily write build up Equity by default you know with the way that most uh most uh most apartment offerings work um so they're you know so there's big economic consequences there's also big social consequences and political consequences right which is um you know and this is something that's kind of been deep in the American character for you know for for many decades but this idea that if you basically if you if you have a sense of commitment if you have a sense that you are actually invested in the place where you live you were more connected to the society you're more connected to the culture and then ultimately you're more you know you're more connected to the politics you know to the politics of the to the political uh to the political body um and so you know there's been long-running policies in in you know the United States to encourage homeownership now it turns out those could be overdone they can end up with problems and we saw a lot of the problems that kind of you know came out of that approach and you know kind of the historical approach in the in the 2008 financial crisis but nevertheless there is like a very kind of big deep meaningful you know kind of sense of identity that comes with uh comes with housing um why does this matter uh you know kind of from a from a broad standpoint um so the reason I think this matters so much is because uh geography is so um uh Central to economic opportunities so right so so basically take a step back uh the role of cities right in human society so like cities are a human invention you know if there were many hundreds of thousands millions of years where you know people you know people were running around without you know in clients and tribes uh not forming into cities then about 4 000 years ago cities were basically invented and and people started to Cluster uh that way um why were cities invented a bunch of reasons but one of the big ones is there's there's economic payoff to being in a city and the way that it works is if you are you know if you have a certain level of productivity and you're in a rural environment you don't have many opportunities to work with other people right who are highly productive if you move to a city all of a sudden you're surrounded by lots of other people who are highly productive and all of a sudden there's a catalytic effect basically this this this positive feedback loop that forms where kind of everybody becomes more productive and so basically it's the these cities are basically the foundation of modern economic growth economists call this the agglomeration effect which is basically if you like slam people together you you know sort of uh you know you can get a lot of good things out of that um you know the the the the the West developed you know we the the story of the West is the story of cities and the creation of all these the you know these these amazing cities um and then you know over the last 50 years you know that that kind of trend has gone into hyperdrive and you've had this emergence of what economists call Superstar cities where you've got these specific cities like Washington DC New York City Boston San Francisco Bay Area Los Angeles you know um and then you know internationally London and Tokyo and Singapore and so forth and Paris there are kind of these cities that are like irresistible draws for people who are you know highly ambitious and want to be around a lot of other highly ambitious highly productive people it turns out as a result of that Superstar City clustering thing there's been a bifurcation in the housing market right where basically those Superstar cities they become you know basically occupied at some point you know people end up with a political agenda and then they stop building housing right and so the places where people want to go and want their kids to go are very difficult to get to in the San Francisco Bay area is like a you know a classic example this you know San Francisco last year like authorized I think 6 000 new housing units right which it was just like an absurdly low number relative to the the demand for people who want to move there um and then the places where that do not have this kind of clustering agglomeration Superstar City effect you know they build plenty of housing but there's not there's not as much opportunity there so so heading into covid you just you saw this incredible bifurcation and you saw the American economy and you see it in American politics where basically you're either in a city you buy a home you know you've kind of got got you've got the whole commitment you've got that level of opportunity for you and your family right or you're in a more rural environment and you're basically stuck and you don't have access to good jobs and your kids are not going to have like high-tech jobs and it's you know basically it's you're going to have a lower quality of life um this was becoming a very big issue this become a very big issue by the way for for us because we were kind of we were basically getting stuck in the geographic confines of Silicon Valley like we were our companies were like penned in and it was becoming very hard for companies to grow in that area and then basically you know a horrible tragedy struck that turned out to also be in some ways a miracle in terms of I think the long run consequences which is coven right and you know none of us would have hoped that covet would have would have happened and it has been a horrible tragedy for for many people and I think you know broadly for our society but nevertheless covid was a System Shock right that caused all big companies to basically instantly Move online and a hard cut over you know in kind of a way that I never imagined was possible um it was also an instant proof that companies really can run at least for some time they can actually run uh online right basically like no big company actually stopped operating as a consequence of this dramatic shift from from in person uh to online um and then all of a sudden like that opened the door to you know every CEO every manager every entrepreneur every investor thinking oh um okay the post-covered world is not going to be like the free coveted world the post-covered world is going to be an opportunity to rethink and reinvent how companies are organized it's going to be an opportunity to reinvent how Industries are organized it's going to be an opportunity to reinvent you know how geography works right what the role of cities is it's going to be an opportunity to spread the economic activity from cities much more broadly you know potentially throughout the country um you know every employer every company every CEO here you know is is having some version of this conversation you know with their own company we talk about this with our Founders all the time um and then there's the corresponding question that's opened up which is how are people going to live um and some people are going to continue living the way that they were and some people are going to undertake a radical change in how they live and they're gonna you know they're gonna go they'll go remote and all of a sudden you know you go remote and you have access to you know thousands of jobs anytime you want which is a totally new phenomenon um and then there you now have the opportunity to rethink how how families live right and so you know is it necessary for ambitious kids to leave a place where they grew up in order to have access to first-class Economic Opportunity in 2019 he asked her that was frequently yes today maybe not um and so and and I should also say like it there's no like this is not a zero or 100 thing this is not like a hard cut over it's not like the whole world goes remote or stays remote right which is not what's happening but there's this moment in time that we're in right now which is like we can actually we can rethink and reinvent how companies are organized um and how work happens and then we can also reinvent how people how people live and give people a lot more options and how that happens um and so I I think basically the presumptions that have underlied the whole structure of how the housing market works and how the industry works and how people live and work I think it's basically all it for grabs I think we have about a five-year window I think as a society to kind of figure out what this means and how to adapt um yeah let me pause there that was awesome um perfect answer which is a good it's a good segue to where I want to go into which is uh we we have seen work become more Dynamic people now sometimes go into an office some days a week sometimes they go in for a couple months and they go to a different office a different city um you know like we work with quite equipped for this kind of dynamic work lifestyle what are the lessons that you have learned from wework that you're going to apply to flow or things that maybe you didn't you didn't do it we worked but you thought about that you're going to apply to flow particularly around sort of this changing way people live and work and how people as we get to rethink the way that we sort of organize ourselves and and bring ourselves to to work into home so I think you're right I actually think flexible work is more relevant today than 10 years ago so I actually think it's a better idea today than it was the obvious lesson is community I think Corona I think on top of everything that Mark just said and I'm not going to repeat any of it but but that's the data that pushed us into being as interested as we were in this category but on top of all of that we for a lot of time I think a lot of people argued Howard Schultz used to say Starbucks is the third place I remember once having an argument with him I told him we work as the third place it was like Starbucks is the third place well I think the first place turned out to be the third place I think the home is the most important thing I think covert taught us that I think you can take your your work into your home but you can take your home into your work and that's affecting a lot of change also to put the little numbers behind what Mark is saying 70 of 35 year olds and youngers are currently renters they don't actually buy and this number is not because of the interest rates that have been going up over the past six to ten months this is a number from 12 months ago and we believe that that number is actually only gonna grow so 70 percent are renters you said it's a big piece of their spend it's about a third of their total wallet so you have this huge asset class largest in the world 70 of its users are renters it's a third of their spend and yet they're not getting an experience that is actually up to par not to talk about the financial you mentioned mark that they're not creating an equity and they're not creating any equity and when you put those two things together you see a real Challenge and what it's going to do and we're already saying it people are starting to work where they live and not just live where they work and therefore you're starting to see these movements between cities and you can even say without becoming too political but we're in the heart of politics maybe some of the results in midterms now showed Democrats that were actually traveling to new cities and moving to different places a lot of things are shifting and the way we live has an opportunity right now to change because I think if we weren't clear about it before how important the home is everybody is reminded and a great home and a great experience an elevated experience is more important than ever before and then work has talked accommodate and Mark and I actually think see the world a little differently about what if our is every company going to be a remote company or in-person company but the answer is obviously hybrid of the two and as you think through well harm I'm going to solve work and how am I going to solve the future of way people live what I see is an opportunity to really affect that change and it's exciting that we're in DC because this is one of the places where opportunities like this become a reality if I could put you put put a put a point on something that Adam said so the you know there's sort of this there's Richard Florida uh to analyzes these things talks about he calls the creative class it's kind of you know the sort of say upper middle class you know it's it's us it's our kids right um uh it's it's sort of you know Highly Educated you know kids who are going to basically go into a knowledge or create a profession of some kind right work work work at a keyboard as opposed to you know with their doing doing some form of manual labor manufacturing and of course you know this is not most of the economy but this is sort of the you know kind of the upper middle class um you know in many ways the cultural Vanguard for the you know for the country you know they Define a lot of the trends and so there's this experience right that I'm sure a lot of us have had and a lot of a lot of a lot of younger people we know have had in the last especially 20 years you know really really 20 25 years the sort of thing where you you know you're growing up at home you you then go to college you you spend your time at College you know for or more years um and you know you're on this campus environment and it's you know and everybody knows like college is kind of education it's kind of adult they care um you know um you know it's got all the it's gotten all the food and entertainment it's got this whole contained environment it's a social environment it's a dating environment right it's kind of this this whole thing um you know you're putatively you're an adult but you're living in a dorm and there's like a older adult down the hall who's taking care of you right so you're not really fully an adult um and so you're in that environment and of course you know in you know 50 years ago you'd leave that environment and you'd you know go to work in an office you'd buy a you know you'd buy a starter house and you'd be on your you know sort of traditional American middle class path over the last 20 25 years it became very common to have this idea of the corporate campus right and and you know sort of Google maybe you know really kind of you know crystallized that in the in the culture um you know basically this idea that the company's facility where everybody came every day was going to basically be a continuation of the college campus experience um and and that led to kind of this you know perk Bonanza right so you'd have this whole thing go to his campus and it's like gourmet food 24 hours a day and it's like they'll do your dry cleaning and they'll walk your dog and there's you know swimming pools and there's the thing you know by the way you know these campuses still exists they're all 100 converting all their tennis courts to pickleball courts because of course that's what everybody's doing right so so there are these you know it basically a self-contained environment and the theory of it right was if we can get people you know especially these young people like inculcate them keep them in this kind of college campus kind of environment then they'll basically they'll work more right we'll get more out of them because they'll they'll be here more often um you know it's basically everything up to not usually including the actual bed um although sometimes people would sleep under their desk um like like Elon Musk um but everything you know sort of short of that um and so as a consequence you'd have this thing where sort of young adults kind of stayed in this corporate campus environment and then as a consequence they had this incredible Community right they had this incredible environment right where they have you know all these friends co-workers colleagues you know their you know their teammates other people who work at the same company they're going to lunch going to dinner doing the whole thing and then and then by the way it also turns out it's that it's it's just like the college campus it's the dating pool um right um and so you know it's you know basically if you work for you know for the Google campus or the Facebook campus like where you're gonna date probably somebody who also is there because you're there all the time together and then you basically like Drop covet into that model and you just like detonate it right which is which which is what's happened right and then all of a sudden the experience of a kid going through that all of a sudden it's like nope nope you don't get that what you get is you get to sit in your studio apartment right in front of your laptop right and good luck right and you're like cut off from everything else and like you've got doordash but and you've got Tinder and like that's your life and like that is not the same thing um and so and then you know to Adam's Point like a lot of these companies now are thinking okay we're gonna have people come back in the office two days a week three days a week and we're gonna have them come back and chance or this or that but you know this the spirit is like Elvis has left the building for the for these kinds of environments like this is not the way that most companies are going to operate um and so all of a sudden the focus on where you live the focus on what you know are you literally by yourself you know do you have roommates are you in a small you know complex are you in a big complex do you do you have any sense of connection whatsoever do you know who your neighbors are you know most people historically live in apartments I don't think they generally would even know who their neighbors are right the guy next door is just the guy next door you you'd feel no connection um by the way there would be no overlap where you lived and the people you worked with would have no overlap right because there was no point you didn't worry about whether there were other people who you worked with who were in your same apartment complex because you were seeing them at work all day and so do you have anything in common with the people you're in the building with um and so so there's this there's this sort of whole model that an entire generation grew up with that has all of a sudden been detonated and I I yeah and I I don't know it may be political I think the idea of sitting in the apartment in front of the screen with doordash and Tinder is not a good life um and so that that opens the door for reinvention we don't we don't think we know it's not a good life because we've even in the office so you gave Google as an example Google was inspiration for us that we work our point was well why can't small businesses have this great campus have this great energy and that was the beginning I remember when we tried to sell Google but like can we we could take some of your stuff they're like you can't take our stuff we're Google we invented this we ended up taking some of their stuff and quite a lot actually but um they they that same Serendipity feeling that you feel when you go when you were to go in an office and connect to this belongs in a home in a funny way way more than it ever belonged in an office and when you think of these apartment buildings and it is a little sad it's sad that there's an apartment building with 400 apartments maybe six seven hundred people with a swimming pool and a kitchen and a gym and all these amenities did when you if anybody here has ever been in a multi-family you do this amazing tour they show you all these amenity spaces you never see anyone there you then move into the building and you not everyone but a lot of people live their life that Mark is describing and that's sad because I don't think human connection thrives I actually think I'm so happy we're here face to face and covet was obviously a horrible thing but also a miracle at the same time it's a miracle that we're all here face to face because this connection is so much more meaningful and why doesn't why don't people deserve that in the home and again I go back to that number it's a third of their wallet spent as the Americans were used to actually for anything we spend if it's two percent of our world spend one percent of our wallet spend many companies that you guys invest in it's all branded it's always an uplifting experience if someone doesn't do good enough experience then the next person comes and elevates it and yet in residential and we can talk about why but in residential never happened and because it never happened and because it's so difficult to disrupt it actually didn't occur and what ends up happening is that renter is not getting a good deal neither the experience or the financial transaction and again that renter is the majority of the young adults yeah I think covid was the first time a lot of people especially under the age of of 40 50 first time they ever got to know their neighbors or they never had to and they're they're proxy for Community probably was the workplace and like you said we're never going back to that whatever our new normal is it's not I'm just going to give you a thought about that it's an American thing that they never had to like in other countries where I grew up in Israel there's no such thing you don't know your numbers when you don't have sold you go to your neighbor's door you knock on the door they don't answer you open the door it's locked you know where the key you open it up you go and you take the self you never break it back yeah then they go back there's no Soto Adam took it and and it's it's it's this it's this community here we call the police yeah yeah yeah they come in four hours it's true or San Francisco maybe never yeah yeah you guys said they said that I didn't say anything okay yeah but the point is that's it's such a natural thing for people living together to connect and yet we live in a world where even when people are in the same building they don't talk to each other in the elevator when I came to the United States and used to say hello to everyone in the elevator people thought I was weird yeah and I thought it was weird that you wouldn't say hello wouldn't you want to know who's living there and you know we have a lot a lot of little things and we we haven't talked about really flow yet there's a lot of different ideas that we have but the simple one is when people tour a building always the the tour the leasing agent tells you about all the amenities I would like the listing agent who's not even going to be called the listing agent to introduce you to a few residents who actually like living there let them tell you why this is a great building and if it's a fit for you or not a fit for you and that tiny little thing I just said is so small and the fact that it doesn't exist actually and a lot of people ask me Adam how come this didn't exist before it doesn't exist in my opinion because buildings are full anyway there's a short of supplies we spoke a little bit about zoning there's the numbers varies but between three to five million apartments and single family homes missing right now in the US and that number Grows by hundreds of thousands of units a year and so there's a shortage of Supply there's an over demand and no one really needed to do it and because the landlords didn't need to do it it didn't happen and when you think of prop their companies and Technology I was talking to Steve case before for a second about proptech and I'm a little bit about about all the different Innovations when when you think well why haven't people solved this problem before most popular companies come in and sort of solve a point solution they have this one solution but then they need to take that solution convince the landlords we're not even interested in buying anything because they're making money anyway go to these old Erp systems connect to the back of these systems then get the users it's very difficult which is why the way we want to tackle it is actually vertical I almost think it's the only way excellent the uh we're gonna come back to that in the vertical software stock for prop Tech and flow in a minute um Mark you know we we came out Ben had a big blog post about how we've moved our headquarters to the cloud we have decoupled uh the geography of the firm um so I guess the first question is like two parts talk a little bit about the thinking about moving to the cloud why did we do it and then talk about how it's gone yeah and then I'll keep you honest if I agree yeah so this is yeah this has been very dramatic I mean look for for every employer every company this has been dramatic we've had our version of it um and for us it's been very dramatic which is we we made a very deliberate decision when we started our firm in 2009 that we were really deeply going to invest uh in the office and in particular in one office and so we were kind of semi-notorious in the industry for we only ever had one office the office was in Menlo Park California um you know this is actually controversial even in the Bay Area because there are lots of startups are actually in San Francisco lots of the younger people who worked for us lived up in San Francisco and we said you know it's our you know and everybody every year was like we got to put up an office in San Francisco and we're like nope single office everybody's gonna be in the office and and the reason for that was we wanted the Beehive you know effect like we wanted people when they walk in both the people who work for us but also the people who are visiting us to really feel like they were tapping in the energy they were seeing lots of other interesting people you know that this was this was the kind of environment you know and the kinds of people they want they'd want to be around so we put a really big emphasis on that um you know we were in there you know every day all day um working together you know the whole the whole thing the whole thing you get from a high functioning you know kind of office environment and then like everybody else in March of 2000 like we shut that down um and we went you know completely online um and like everybody else we were shocked that we were able to continue to run the firm you know as you know you basically keep everything going uh you know over over Zoom um and so and slack and so forth and so you know kind of often away we went um we actually then actually actually had an incremental process right and you know the two weeks to crush the curve turned into two months turned into two years right it's not like everybody else we're trying to figure out how long this is going to last we start doing polls of our employees and we did like a poll like six months in and people were you know some people were like I can't wait to get back to the office simply people were like wow I don't know um you know 12 months the numbers moved 18 months the numbers moved and then we had one poll where it was basically like 100 of the young parents were like if you guys want to go back to the office good luck we're getting different jobs um it's like I get to spend time with my kids I get to to be here in the morning I get to be here at night I'm you know by the way I'm working at you know I'm working from home you know you know 12 hours a day or whatever I'm more productive than ever but like I am not going to do the you know two or three hour daily commute you know from South San Jose or from you know San Francisco or from the East Bay um you know to go to Menlo Park I'm just not going to do it anymore and so that that perked our ears up because it's like okay that's interesting um and then the other conversation we had was basically what's going to happen to our companies into our industry right and and so it's certainly not the case that all of our companies are going they're certainly not all going fully remote and we actually have quite a few companies that have actually elected to actually stay very office Centric um which is which is actually a very interesting counter programming thing that some people are doing now but you know generally speaking our companies were indicating that they were going to become more flexible and they were going to really start to spread out um and then the industry just felt like it was going to expand and we were seeing you know a lot of Founders who were frustrated being in the Bay Area you know basically left over this period and they went to other places and they started companies and and so we basically decided like we can't be in the business of partnering with people who are building the future sure if we're not living in the future ourselves and so we basically said we'll just do a hard reset we'll become um you know sort of uh say remote Centric or sort of virtual Centric I just approved a request we converted we we still have our office because it's not a long-term lease uh we converted it to hoteling um and I just signed off yesterday um on converting my former office into the apparently the new Lounge um so I'm very excited to visit visit visit the the new Hangouts face um and so uh basically what we decided is you know and so basically we're going to keep we're going to keep offices basically as as places for people to go when they need a place to work for basic for teams to be able to meet together we're also actually letting our Founders use our offices more which is actually helping them figure out how to kind of adapt through this um and then we're going to expand basically actually the wework model being ahead of its time we're going to have more smaller offices and more locations and so we've opened formally in what do we announced so far at least five which are the which ones we announced La Menlo SF Miami New York New York to New York three uh uh I think that's it for the moment yeah and then we'll yeah and we'll we'll have more in the future so we're yeah we're going to accommodate we're we're now we're we're a you know we're we're not a you know we're an investment operation not a product so we don't we don't have like you know assembly lines or software you know kind of you know production so we have a simpler version of the problem but we're letting our teams decide basically how to distribute so we have some teams that want to be in person we have some teams that want to be remote and I would say I think it's gone so we're doing all that so the way basically the firm runs now is we basically run the firm remote like all the formal meetings are on Zoom everything is kind of equalized um you know kind of that way um but the teams are free to Cluster whenever they want um and then we have a very big focus on two things one is off-sites um and so get you know every team is expected to get together on a frequent basis and we really invest in that um and then a lot more travel and so so I'm traveling you know I'll I'll my steady state I think is going to be traveling at like 4X the number of days that I used to travel um and you know and all of a sudden right it's even higher impact than it used to be to actually show up someplace and actually be there in person um so for us it feels like a real broadening out of what a firm like ours is capable of doing it feels like a way to basically accommodate scale um because we definitely felt bottlenecked uh you know where we were um and so I I think it's a way to run um you know look I think the Adam's Point like we're feeling our way through it I think a lot like I would say especially this I've talked to a lot of big company CEOs and I think they're all and I think they would generally agree with this they're all in an intermediate state they're they're all in some hybrid state where they kind of have a lot of vestiges of the old model because they've got the offices they've got and they've got the employees that you know lived in the certain places but they've also they know that they can't go back to the way things used to be so they've all got some hybrid remote virtual thing it's usually a two or three day week thing it's not working really well they've got you know this big question of do they also hire remote employees because if they do then it brings up the issue to the current employees is why can't they become remote and then they've got you know they basically all have to reinvent all the communication flows all the management systems and then they've got this fundamental question for their people especially all the new hires right and you know we're now we're going to be on five years in here pretty quick and so there's an entire generation of kids coming out of school that are going to work for these companies and they're going to have a different set of both you know expectations and issues and so this is why I think we're still at the beginning of the change like I think we're three years into it probably a 10-year process and I think the level of reinvention is going to be actually quite staggering from here yeah I think that's right I think we've we've managed through it very well we actually materialize where we need to and have a lot more Face Time you know I think I mean I see you all the time uh outside the office and I think we get much you get much more concentrated focused time together to actually be productive and it's like you know the hallway track is okay at the office but it's a little bit superficial how was your weekend what did you do when you go to an offsite it's just much more focused and conscientious about what is important to us what went well what are we not doing what do we want to be doing so my takeaway is that when we are together it actually is way more productive you know not that I don't care about your weekend I do care but uh you know it's not as important as talking about the next 10 years of the firm yeah I call this I call this the barbell right so it's it's the because everybody always asks what about the water cooler moments and I'm like God I hated the watercolor moments like I mean like to have to stand there and like talk about the football game like I I can't I can't I temporary seems like a wonderful guy I can't do this it's very deflating yeah I'm gonna I'm gonna have to I'm gonna have to push back my my partners a little bit okay go ahead um yes please go ahead for an investing firm I accept and I already said you guys are not just investors you're you're partners and businessmen and entrepreneur and it's it's factual I strongly feel and and Mark as to what's important about this conference instead it's important to think a little bit how the future is going to look it's just an opinion I've been in a few offices I strongly feel that the serendipitous connections those those so the watercolor is boring they're interesting when you're building a company and it's getting exciting and a new idea is coming and the whole team was supposed to go home and it's 8pm and everybody told their husbands their wives and their kids were being there in 30 minutes and then someone went to the bathroom sorry for the example and comes back like I have it and they say this thing that solves the entire problem and everybody gets so excited and before you know it it's 2 am and we just moved the business forward not by a week but by a year and now it's 2 A.M it's very late everyone's sleeping already well let's go out and grab a drink and now everybody's hanging out and before night you just had one of those nights that's a month that's this moment in the life of a business that then you look back and you say I know that day when it all changed that special piece cannot happen on Zoom I think human potential is in the cloud I believe it but human interaction is happening right here and I actually think if you look 10 years forward the companies that are going to make the effort now to be face to face now we can describe what face-to-face is there are many ways to do it but the companies that are actually going to do the face-to-face I think when we look back five years maybe even 10 are going to be the winners obviously I agree that the huge ones who don't know what to do with themselves that's an opportunity for incumbents to come but when I'm thinking of startups and new businesses even stronger businesses with my team we're fighting for that face-to-face time and and every time we're together the excuse of having this event brought a few of us together and three things came up about the business is we're thinking about just what we're going to talk about and and I think that's priceless now take that because we agreed that the office is a challenge bring that back into your home you're back in that multi-family building why not have those connections there why shouldn't you meet here and it makes a lot more sense for me by the way I'll meet my wife or my husband in the apartment building when I went downstairs to the pool than I do in the office so both of those things work really well and from a business point of view I can do business there also and then maybe there should be a co-working space there should be an office and maybe Enterprises are going to look so if Enterprises need to do culture and if culture is not going to be in the office anymore then maybe there's a new hybrid that has to do with the home put together with an office space then I'll give one more thought that I have I think the fact that you guys have seven offices is the future so I do think it's smaller offices and centers but it's going to be very hard for me to be convinced that not bringing people together and not having human connection is is in our nature I don't think we're built to look at the screen and I think that the one day when we're all much much older and we're second we're on our deathbed and we're looking at ourselves and we have that moment of realization and we say well how much time in my life did I spend with my loved ones with people I really care about and how much time of my life did I spend in front of a screen if that answer with front of the screen is too big I am not sure how we're gonna feel that second before it's all over look I think we would all agree you have to know what inning you're in sort of what time it is in your company there's definitely moments that matter where you all want to be in a room working together and then we do that we would agree with that for sure um so actually let's talk about Adam you've kept a lot about flow close to the vest give us a little bit about the vision you've given us a little hint throughout your answers here but what are you what are you really hoping to build uh with flow I actually thought because we were talking so much that I was going to keep it under my vest one more day oh yeah well I thought I was going to get away with it well first of all same reason about keeping it under reverse it's not that we've actually been keeping it under a vest it's that one of the many lessons that that we learned from the past is talk is cheap we just want to build we just wanna it's it's a heavy lift and we just want to get to work so we had no reason to say anything I I met a nice person here earlier today who I think said something about me when he was talking before and I said you know that's not true what you said it goes but that's what the media said and I was like well I never spoke that's right the media the media is never miscarried against him either he then told me he said you know I'm not sure I buy into flow I said well I never spoke about that either um in a very simple way we want to create an elevated experience for the resident and we want to find a way to share with the resident a portion of the value that they create I'll give that a moment we want to elevate their experience we talked about the buildings we talked about everything that's happening I actually think I don't think it's an easy job I think it's very hard but I do think the power is low you just make a little more connections you just make it a little bit more real you pay attention to the people running it you maintain it the right way you leverage technology to actually make things work instead of using nine apps use one you do simple things and you elevate the experience but then the more complicated part is you find a way to share a portion of the value and with the resident itself and because and that's the vision and because we said that it's a majority of the young adults and because Mark said that that's how people so a few numbers behind that for 80 years owning a home used to be the way that that was the majority of us creating a equity and 60 of Americans today in average their equities in the home that is the majority of equity so if we're correct and 70 are renters and that number is only going to go up what were they going to create equity and if they're going to be renters for 10 years 20 years when you go into these apartment buildings and it's true about single family but for today we'll we'll talk about apartments if you're going to go into these multi-family buildings and you're going to have this disconnected experience that you just said but you're not only going to be there for two years and then get married and move to home you're going to be there for 20. that sounds Soul crushing right and therefore you have to solve both of the sides can I ask myself the next question sure Adam how are you going to solve most of this side that sounds really good but what are you actually got a great great question thank you thank you for that great question and well we have four pillars as we're looking at the business today we have the first one which is a branded technology first management company that actually runs the buildings we have an asset management or real estate fund or real estate company that actually owns the buildings and something cool about our new business we actually own buildings together already one of the biggest words that Mark and Ben used as I said before was alignment alignment alignment alignment so for perfect alignment we contributed into this business at least as much as as and recent contributed into this business and I'm very excited about it and it's it's amazing to feel like that and then we have a financial services company so number one management company branded technology first number two real estate Asset Management a company that can buy real estate and asset managed real estate number three financial services and the fourth pillar is this mechanism that's going to take some of the value and share it with the value creators and what we get so excited about the vision of flow and The Business of flow is that it's actually a flywheel if we can actually create a better experience in the building then the building performs better and makes a higher noi if the building makes a higher noi then we'll be able to raise more money and buy more buildings if we buy more buildings then we'll be able to run more buildings and have more users in those buildings and those users are going to start using our financial services now the reason they're going to use the financial services the first thing you do in buildings is you charge rent every month and that's 35 of their total wallet so that payments company that's charging your rent already has a real relationship with the user if that financial services company is going to do what we wanted to do and create services that are actually meaningful recall where you think of it as Financial wellness and give services that are actually meaningful then that again is going to drive more users and then if we are able to take this value creating mechanism and share with the residents a portion of the value it's going to make them feel ownership and it's not just ownership I feel like I'm part of something it's I actually own part of something and again the word ownership is a very complicated word especially in this place but if there is perceived value and if that value appreciates over time then I feel like I'm part of a community and a very funny example that we like to give is if you're in your apartment building and you're a renter and your toilet gets clogged you call the super if you're in your own apartment and you're and you bought it and you own it and your toilet gets clogged you take the plunger and it's it's the difference when feeling like you own something to just feeling like you're renting from being trans transactional to actually being part of a community and our vision is to bring it all together and just one more example of just to put it into numbers average churn in a property Management's average churn in multi-family in this country is 50 it means the user stays in average for two years if the user now enjoys their experience more and feels like they have a portion of the value and chooses to stay a little longer and that average turn goes down from 50 percent to 40 percent without getting too deep into the numbers the noi of the building will go up by approximately five percent which increases the returns of the building for those LPS for the investors by 500 basis points which in real estate is an unheard of number and by tackling this challenge vertically is what flow is planning to do and as I said we're just getting started excellent I'm going to wrap this up with one with a sort of common question for both of you are there any model cities that are sort of doing this right from a regulatory standpoint from a building standpoint from a community neighborhood standpoint and then part two is sort of what role does government have to play uh in sort of facilitating and improving either you know Home Building homeowner ownership and all these components so we'll start with with Mark Mark yeah well look cities were stern-ups at one point right like so every city was a startup um and you know there you there's like incredible stories if you go back far enough like creation of cities like Los Angeles or Washington DC you know for that matter um you know in the in the 20th century that kind of went at least in the in the west that kind of went out of fashion became sort of an intractable thing to try to do you know there were some entrepreneurs who thought hard about it and gave shots at it so Walt Disney right had a whole you know Walt Disney had a whole Vision um you know what you know the Disney company to this day has these you know planned communities that kind of come from that uh you know Walt Disney actually had this vision for they actually have this thing um called the Epcot um experimental prototype city of tomorrow um and stayed in the museum in San Francisco if you go to the museum you can see it oh is that right okay the whole thing well they still I think they still have the Epcot what the part of Epcot that got built I think is still in in Florida so you can go visit I think the remnants of Epcot so um you know this is like this is like sort of futurism from the 60s you know kind of in in in Disney's mind and he wasn't able to get he passed away he wasn't able to fully develop Epcot but he he was he was kind of reaching in this direction uh towards the end of his career and then you know there are other examples in the U.S you know it's probably um what is it Irvine um you know took a big swing at this um and actually it was has been very successful and then um you know Venice uh Kimmy you know sort of you know created the you know La created the Venice canals as a sort of a plan commute so you know there there are various ideas like this it's been a long time since somebody's really taken a hard swing and and so basically what you have you know basically what you have are Legacy systems you've just got this sort of entrenched you know complicated power you know kind of system local homeowners I mean it almost seems deterministic that if a city becomes successful it basically the local homeownership whatever political base devotes itself to preventing the construction new housing and it seems like a real a real trap so I'll add to what Mark is saying but if a city was a business and it's an old business and it's 30 years old then they're going to say forget that business we're going to start a new one we're going to fund it we're going to start it and we're gonna and we're gonna take over the problem with cities they're built so to go into a city now and change let's just start with something very simple most of the city is concrete and roads where cars are driving as and there's so many new Solutions and you can really talk today about what's happening and anybody who knows New York City and so when Uber was getting bigger and bigger how the yellow taxes started disappearing was an unbelievable experience and how the medallions that used to cost a million three suddenly so it's it is a very challenging thing to actually reimagine a city when it's already built and there's things you can do it when you look at these buildings there's single standing Villages yes a building with 400 apartments we can reimagine what happens inside of it but reimagining a city is a big is a big gay undertaking and actually one of the only places actually in Saudi Arabia where I know some of the team members were just there they're actually going for it so there are places in the world right now and and it's very Innovative and it's very impressive that they're doing it that they that people are actually trying to build new cities but the answer to that and sort of how government can help there are technology companies right now construction companies there there are different things there's there's a construction company here called icon that's using technology that the government is going to need to partner with them at some point because they have found ways to build a home in four days that used to take that used to take a year and a half and as you can do more and more of those things what we're gonna do is I believe through Innovative Technologies be able to build it fast enough to give people the courage to go and build a new but to go into the old ones is very hard a crazy idea is the office now everything that's happening in office can you go and convert some of these dead offices into some of your dish you could think about that and I think the role of government has always been very important for this country I think for us that flow and this is another lesson from the past we used to think and I used to think we had to own everything I think the category is so big that the only way we're going to achieve anything is through a partnership partnership with government partnership with current players and partnership with new players that are going to come and I think it's the only way to solve this problem and I'll finish by saying that I actually think the housing crisis that we described might be one of the biggest challenges that the US is facing today but the reason it's hard to understand it it's because if you really want to get it it's five to ten years down the road the problem with housing it takes five to ten years and Mark I agree with your assumption that we have about five years to do something really big about it and all I can tell you is I think we have the right team to give it a shot excellent uh well thank you both uh for being here this is a great discussion we're gonna wrap up and get everyone out of here and talk about the party tonight thanks fantastic thanks everybody as a reminder this conversation was part of a16z's American dynamism Summit in Washington DC you can find the full library of videos from the event in November by going to a16c.com a 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