6 ms·

Thoughts on Campus, a Failed Housing Startup

53 points by edward 11y ago

Danilka 11y ago
I was one of the 8 people to move into the first Campus house. All of the other 7 people became my close friends and I never regretted paying premium to be a part of that community. Would I have chosen to do so without the community promise? Maybe. Would I have stayed long? Probably not.
api 11y ago
This is too bad... I would be very interested in something like this. I'd be curious about more details as to why it failed as a business. Were its costs too high? I wonder if it was more or less a victim of the insanely high real estate prices in SF and NYC and whether it might have been more successful elsewhere.
- danieltillett 11y ago
  I would say it was the standard reason which is the margins are too low (because of competition and then need for large amounts of human labor) to support a tech start-up valuation. There are lots of potential businesses that have high demand, but you just can’t make money from them. It is relatively easy to build a business that customers love, what is really hard is to build a business customers love AND are willing to pay a premium to use AND which can be monopolized so your margins are not eroded by competition. These are rarer than unicorns.
technotony 11y ago
I lived in two campus houses for a period over a year. The vision and concept were great, and it's failure should 100% not be read as a failure of the sector. Someone's going to do this right and make a big success. I don't know if they'll reinvent whole cities, Tom's full vision, but they'll make better places for people to live. My personal view of why it fails (as a housemate not an insider to the business) was the following: 1. Too much money too early meant they spent more than they should on things which weren't necessarily valued. Examples being hot-tubs in all the early houses, the vacation houses (I get they were an experiment) etc. 2. Poor financial management. Property at it's core is a simple business and getting the accounting/billing right is vital. I suspect that the leadership team didn't have enough financial knowledge of the books to run such a business, needed a grey hair CFO much earlier. 3. Premature scaling. I assume pressure from investors and the economics models showed you had to get mega scale to get VC rewards, and this lead to pressure to grow too fast. I moved from one house to another and it was clear there was a difference in how carefully the inhabitants were selected and this weakened the value proposition (the second house had two separate groups with very different and competing goals from living together). I really hope someone gets this right, and not just for 20 something year olds. When I get married and have kids I'd love to have 5-10 other families sharing common areas, responsibilities etc. Figuring out how to build that community element and make it scalable is the hard part.
- gatsby 11y ago
  Great analysis. The author of this blog compares Campus to WeWork, but WeWork is actually doing a very similar concept to Campus called WeLive: https://www.bisnow.com/washington-dc/news/office/welive-and-wework-in-crystal-city-43957 https://www.bisnow.com/washington-dc/news/office/welive-and-... With WeWork's massive success over the last six years, it should certainly be interesting to see if they can get the economics and experience right.
- dsr_ 11y ago
  The name for what you want is cohousing -- I know of at least four cohousing communities in the Boston area, and there are probably many, many more. The usual cohousing model is (relatively) small apartments gathered around shared communal resources, in a condominium financial arrangement. Instead of the condo just being your share of a building, it's a share of the community. The fee is partially in money and partially in chores performed: helping to cook for a communal meal once a week, helping to clean up, helping to maintain things and make things better. A cohousing community can generally afford better amenities than the people could individually: how often do you want to play piano? If you're not a pro, having a well-insulated piano room is really expensive - but justifying it as part of the community is easy. Want a really good home theater? A pro kitchen? Really good gardens? The people I know who have tried cohousing have either left after the first year or decided that was how they wanted to live for the rest of their lives.
  - klipt 11y ago
    > If you're not a pro, having a well-insulated piano room is really expensive - but justifying it as part of the community is easy. Or you could just use a digital piano with headphones. Much cheaper. > The people I know who have tried cohousing have either left after the first year or decided that was how they wanted to live for the rest of their lives. I imagine a lot of it depends on the other people. Tragedy of the commons can easily happen unless everyone shares the same standards of kitchen neatness, etc.
    - superuser2 11y ago
beatpanda 11y ago
The entire business model is s "how can we convince people in expensive housing markets to pay even more?" and it took this many words to wonder about why that didn't work? Fuck these people and anybody dumb enough to buy what they were selling.
- tomasien 11y ago
  I'm moving into a Common in a few days. I'm paying about $250 a month more for a much nicer place with month to month flexibility than my friends living in a tiny 3BR with a 12 month lease. All in with utilities/internet/etc included it's about $100 more per month. It's pretty sweet. $100 more for a nicer place and full optionality is worth it. What a horrible attitude you have!
  - rootedbox 11y ago
    And do you think all that is sustainable??? For Common to be profitable it should be charging you way more than 250 market rate. Though the person you are replying.. was uncouth in how he was saying his thoughts. There is validity in those thoughts.
    - tomasien 11y ago
      I do think it's sustainable - you need to kind of see the house to understand, but they get 19 rooms into a building that would normally have 14 or 15. They can do this because of the way they organize common space all onto 1 floor, like a dorm. They sold out of all 19 rooms in the first building before they even hit TechCrunch - if they can keep occupancy approaching 100%, they'll be in great shape.
  - JackFr 11y ago
    You understand a 12 month lease protects you as well as the landlord.
    - reustle 11y ago
      Sure but if a company like Common is running the place, you don't need to worry about the kicking you out next week or jacking the rent up 2x
kirubakaran 11y ago
I lived in a Campus house for a year, till they closed down. I made a lot of friends out of my roommates as well as the extended community. They really did a great job and it is so sad that they weren't able to make it a profitable business. They removed the biggest issue with coliving : managing roommates moving out/in, being on the hook for rent if someone moves out and you can't find someone great in that short period of time etc. You just paid your rent+fee and they took care of everything else. I've heard many stories of Campus members (=tenants) asking for ridiculous things from the support people, simply because Campus would provide it for them, no questions asked. "This is why we can't have nice things" came to mind frequently.
- kornish 11y ago
  Out of interest, what are some examples of ridiculous things for which people asked?
endgame 11y ago
It saddens me that the first I heard of this was the author hearing of its closure. We need to have a serious rethink about how we do housing, and building better communities is part of that.

53 points by edward 11y ago

I was one of the 8 people to move into the first Campus house. All of the other 7 people became my close friends and I never regretted paying premium to be a part of that community. Would I have chosen to do so without the community promise? Maybe. Would I have stayed long? Probably not.

api 11y ago

This is too bad... I would be very interested in something like this. I'd be curious about more details as to why it failed as a business. Were its costs too high? I wonder if it was more or less a victim of the insanely high real estate prices in SF and NYC and whether it might have been more successful elsewhere.

danieltillett 11y ago
I would say it was the standard reason which is the margins are too low (because of competition and then need for large amounts of human labor) to support a tech start-up valuation. There are lots of potential businesses that have high demand, but you just can’t make money from them. It is relatively easy to build a business that customers love, what is really hard is to build a business customers love AND are willing to pay a premium to use AND which can be monopolized so your margins are not eroded by competition. These are rarer than unicorns.

technotony 11y ago

I lived in two campus houses for a period over a year. The vision and concept were great, and it's failure should 100% not be read as a failure of the sector. Someone's going to do this right and make a big success. I don't know if they'll reinvent whole cities, Tom's full vision, but they'll make better places for people to live. My personal view of why it fails (as a housemate not an insider to the business) was the following: 1. Too much money too early meant they spent more than they should on things which weren't necessarily valued. Examples being hot-tubs in all the early houses, the vacation houses (I get they were an experiment) etc. 2. Poor financial management. Property at it's core is a simple business and getting the accounting/billing right is vital. I suspect that the leadership team didn't have enough financial knowledge of the books to run such a business, needed a grey hair CFO much earlier. 3. Premature scaling. I assume pressure from investors and the economics models showed you had to get mega scale to get VC rewards, and this lead to pressure to grow too fast. I moved from one house to another and it was clear there was a difference in how carefully the inhabitants were selected and this weakened the value proposition (the second house had two separate groups with very different and competing goals from living together). I really hope someone gets this right, and not just for 20 something year olds. When I get married and have kids I'd love to have 5-10 other families sharing common areas, responsibilities etc. Figuring out how to build that community element and make it scalable is the hard part.

gatsby 11y ago
Great analysis. The author of this blog compares Campus to WeWork, but WeWork is actually doing a very similar concept to Campus called WeLive: https://www.bisnow.com/washington-dc/news/office/welive-and-wework-in-crystal-city-43957 https://www.bisnow.com/washington-dc/news/office/welive-and-... With WeWork's massive success over the last six years, it should certainly be interesting to see if they can get the economics and experience right.
dsr_ 11y ago
The name for what you want is cohousing -- I know of at least four cohousing communities in the Boston area, and there are probably many, many more. The usual cohousing model is (relatively) small apartments gathered around shared communal resources, in a condominium financial arrangement. Instead of the condo just being your share of a building, it's a share of the community. The fee is partially in money and partially in chores performed: helping to cook for a communal meal once a week, helping to clean up, helping to maintain things and make things better. A cohousing community can generally afford better amenities than the people could individually: how often do you want to play piano? If you're not a pro, having a well-insulated piano room is really expensive - but justifying it as part of the community is easy. Want a really good home theater? A pro kitchen? Really good gardens? The people I know who have tried cohousing have either left after the first year or decided that was how they wanted to live for the rest of their lives.
- klipt 11y ago
  > If you're not a pro, having a well-insulated piano room is really expensive - but justifying it as part of the community is easy. Or you could just use a digital piano with headphones. Much cheaper. > The people I know who have tried cohousing have either left after the first year or decided that was how they wanted to live for the rest of their lives. I imagine a lot of it depends on the other people. Tragedy of the commons can easily happen unless everyone shares the same standards of kitchen neatness, etc.
  - superuser2 11y ago

beatpanda 11y ago

The entire business model is s "how can we convince people in expensive housing markets to pay even more?" and it took this many words to wonder about why that didn't work? Fuck these people and anybody dumb enough to buy what they were selling.

tomasien 11y ago
I'm moving into a Common in a few days. I'm paying about $250 a month more for a much nicer place with month to month flexibility than my friends living in a tiny 3BR with a 12 month lease. All in with utilities/internet/etc included it's about $100 more per month. It's pretty sweet. $100 more for a nicer place and full optionality is worth it. What a horrible attitude you have!
- rootedbox 11y ago
  And do you think all that is sustainable??? For Common to be profitable it should be charging you way more than 250 market rate. Though the person you are replying.. was uncouth in how he was saying his thoughts. There is validity in those thoughts.
  - tomasien 11y ago
    I do think it's sustainable - you need to kind of see the house to understand, but they get 19 rooms into a building that would normally have 14 or 15. They can do this because of the way they organize common space all onto 1 floor, like a dorm. They sold out of all 19 rooms in the first building before they even hit TechCrunch - if they can keep occupancy approaching 100%, they'll be in great shape.
- JackFr 11y ago
  You understand a 12 month lease protects you as well as the landlord.
  - reustle 11y ago
    Sure but if a company like Common is running the place, you don't need to worry about the kicking you out next week or jacking the rent up 2x

kirubakaran 11y ago

I lived in a Campus house for a year, till they closed down. I made a lot of friends out of my roommates as well as the extended community. They really did a great job and it is so sad that they weren't able to make it a profitable business. They removed the biggest issue with coliving : managing roommates moving out/in, being on the hook for rent if someone moves out and you can't find someone great in that short period of time etc. You just paid your rent+fee and they took care of everything else. I've heard many stories of Campus members (=tenants) asking for ridiculous things from the support people, simply because Campus would provide it for them, no questions asked. "This is why we can't have nice things" came to mind frequently.

kornish 11y ago
Out of interest, what are some examples of ridiculous things for which people asked?

endgame 11y ago

It saddens me that the first I heard of this was the author hearing of its closure. We need to have a serious rethink about how we do housing, and building better communities is part of that.