I looked at the admission form and this looks to me like a modern day commune.
A Startup That Wants to Build Cities
51–60 of 84 posts
Re: A Startup That Wants to Build Cities
#52This is obviously an ambitious big goal, and so naturally seems like a low likelihood shot.
It's one of those cases where I would like to hear the founders talk. Long, earnest interviews. Podcasting would be great. WTF are they talking about exactly? Step 1 sounds like a house-share idea, maybe purpose built. The likely market is students and recent grads. Beyond that they are talking about building cities.
If these guys have a chance of succeeding, they probably have interesting ideas.
It's actually a cool question: "How do we build new cities as a startup?"
One interesting idea that (I think) seems like a potential bridge between phase 1 and phase 2, is "student villages" where alumni and staff are encouraged to settle permanently. Residents would already be more intimately involved and invested in the community than they would be anywhere else, have things in common.
If 5-10% of a graduating class stayed long term it would give you a fairly rapid growth rate. The eventual size would be reached at whatever size that 5-10% equals the natural rate of attrition. Say 200 graduates settle per year and 1/10 of residents leave in any given year, they would reach 1,000 residents in 7 years and top out at 2,000 residents within a few decades.
You really can't know in advance, but I suspect that a decent number of graduates (especially of post graduate programs) from top universities could be tempted to buy in to alumni communities if the price was right.
But.. you really need to be a badass team to pull off something at this scale and in this space. The list of Big problems is daunting. Financing, governance and ownership structures would be tricky.
Re: A Startup That Wants to Build Cities
#53I looked at the admission form and this looks to me like a modern day commune.
A share house is inevitably commune-like.
Re: A Startup That Wants to Build Cities
#54Looking at the website beyond the landing page, their current business is yuppie boardinghouses. Which isn't really building cities and doesn't scale in that direction because what makes cities hard is economic diversity...Greyhound Stations and methadone clinics have to go somewhere or it's just prettier gated suburbia.
If you look at their "vision" page:
Phase 1 is "communities." These are the yuppie boarding houses. 4, 20, 200, then 5000. Looks like they on about 30 now.
Phase 2 is cities.
I like it, personally. It's got that too-ambitious element but they set themselves a proving ground. If they hit 200 "communities," are profitable and are managing scale exponentially, I would definitely be listening to them talk about creating cities.
Re: A Startup That Wants to Build Cities
#55I'm curious as to why they are choosing to start their pilot program in the Bay Area - they're not a software startup, so why choose one of the most expensive areas in the world to rent/purchase land? There's a lot of land out there with easier avenues to self-sufficiency that are just a plane ride away at the most, I cant imagine them needing to be close to an urban area at all actually.
The type of tenant they seem to be targeting, young, mobile and willing to rent a room in a well managed share house exist in high rent, high rent urban areas. If you can rent a furnished townhouse for $750, no one needs this. If the rock bottom rent for a studio is $1,300, some people might prefer to be in one of these boarding houses with a better location instead.
Re: A Startup That Wants to Build Cities
#56It's not that building a new city is hard. Real estate developers do it routinely. The problem is jobs. There are, at present, quite a few places in the US with more houses than jobs. Only in a few places, such as SF and some areas of Oklahoma where there's heavy drilling activity, is the reverse the case. If you want to buy an empty town of new houses, there are plenty in San Bernardino. Vacant lots run about $7500.…
Hah, there are more houses than jobs in Berlin, but that doesn't stop people from coming. There is more than work and housing to make a vibrant city.
Well, perhaps. But it's probably pretty hard to make a lot of money as a landlord in Berlin if that is the case. Which is ultimately what this company would need to do to be successful.
Re: A Startup That Wants to Build Cities
#57Looks at some of their properties in SF. 3 level house in Haight-Ashbury, ~18 units. Each unit is around $1500/month and they estimate clean/utilities at $200-260 per month. Is that insane to anyone else? Where the heck is all the money going for utilities?!?! I have a two bedroom in the richmond, one roommate and we use maybe $30-40 a month in electric and gas, including the washer/dryer.
Shrug, 1500 a month in SF is cheap.
It's not really cheap for a room in a shared apartment/house.
Re: A Startup That Wants to Build Cities
#58Earlier quoted context omitted.
Most houses are a monoculture of 20 somethings
Reminds me of how 'The Real World' TV show started out as a whole bunch of different people living together in SF then as the show progressed season after season it just became a 20 something mono culture.
Actually, 'The Real World' changed cities every year and the original one was in Soho, NYC, only Seasons 3 and 29 were in SF.
(Sorry, couldn't help myself, but you do make a good point)
Re: A Startup That Wants to Build Cities
#59It's not that building a new city is hard. Real estate developers do it routinely. The problem is jobs. There are, at present, quite a few places in the US with more houses than jobs. Only in a few places, such as SF and some areas of Oklahoma where there's heavy drilling activity, is the reverse the case. If you want to buy an empty town of new houses, there are plenty in San Bernardino. Vacant lots run about $7500.…
Then I look at the 'housing shortage' in the UK...
Re: A Startup That Wants to Build Cities
#60Earlier quoted context omitted.
Hah, there are more houses than jobs in Berlin, but that doesn't stop people from coming. There is more than work and housing to make a vibrant city.
Well, perhaps. But it's probably pretty hard to make a lot of money as a landlord in Berlin if that is the case. Which is ultimately what this company would need to do to be successful.
Quite the contrary, due to the high demand, rents are on a steady rise. [1]
The government is issuing caps now on how much higher the rent can be with new contracts (there are already caps for how much rent can be increased with an existing contract, but when old tenants move out, they could ask for any price on the new contract, especially when renovating the place - which led to shady methods to get long-term tenants out)