As a part of my series about “Big Ideas That Might Change The World In The Next Few Years” I had the pleasure of interviewing Andrew Collins. Andrew is Chief Executive Officer and Co-founder at Bungalow, the world’s largest co-living company. Bungalow is a two-sided residential real estate platform creating a market between millennials who need a great home and baby boomers who own the existing housing supply. Born out of Atomic VC and backed by Opendoor founder, Keith Rabois, through Khosla Ventures, the company is out to make America’s most expensive cities more welcoming and affordable for early career professionals who are increasingly priced out due to skyrocketing rents. Collins holds an A.B. in sociology from Princeton University and an M.B.A. from Wharton School of Business.
Thank you so much for joining us! Can you tell us a story about what brought you to this specific career path?
Bungalow grew from the personal experiences my co-founder and I had when we moved to urban areas following college. We’re both Midwesterners who made our way to San Francisco. I consider myself an outgoing person, but it was really hard to find a friend group in a new place where I didn’t know a ton of people. On top of that, finding an apartment I could afford was incredibly tough and the rental experience felt like it hadn’t changed since my parents were renting apartments. We thought there must be a better way to help early career professionals like myself find amazing places to live and build strong communities at the same time.
Can you share the most interesting story that happened to you since you began your career?
While working at Medallia, a customer experience management company, I was given the opportunity to move to London and open the company’s UK office. This was a huge opportunity so quickly into my career, but I had only just recently gotten myself settled after a move to San Francisco. The thought of relocating to a new city and having to start from scratch finding both a place to live and a new community was daunting. I ultimately decided to pass on the opportunity and stay in California.
As I began to think through initial plans for Bungalow and how we could create social communities for early career professionals, this is one moment that really stuck out to me. No one should have to miss out on a great career opportunity because of the fear of being on your own in a new location.
Can you tell us about your “Big Idea That Might Change The World”?
As the cost of rent skyrockets in major U.S. cities, we risk making these cities inaccessible to early career professionals in seek of job opportunities. We need a higher volume of more affordable rental options, and we need them now. Bungalow increases density in urban neighborhoods immediately by re-allocating existing single-family homes and turning them into multi-unit rentals that cost up to 40% less than a studio apartment. We do this by signing long-term leases with homeowners who don’t want to sell their homes, or take on landlord responsibilities, and then individually rent out the bedrooms in these properties.
We’re just getting started, but our mission is to make a dent in this one piece of the housing crisis puzzle by creating a large volume of new, affordably priced rental units without waiting for slow-moving zoning changes or real estate development.
How do you think this will change the world?
Millennials are buried in loan debt; we can barely afford rent and we certainly can’t afford to buy homes in many cities. We’re the largest generation in today’s workforce and yet the most indebted generation in American history.
Many developers in cities are building either low-income housing or luxury condos, but there remains a lack of affordable options for the middle class. This doesn’t only affect San Francisco, Los Angeles, and New York. As millennials are priced out of these cities, they’re not moving to the suburbs. Instead, they’re moving to other growing urban markets like San Diego or Seattle. These cities are not equipped to handle this influx and pose an even bigger housing shortage problem. For example, last year San Diego added 16,000 new jobs, but only enough new housing for 6,000 people.
Over the last 30 years, the average family size has shrunk by nearly 50%, and it’s been increasingly more difficult for homeowners to rent out their 4+ bedroom homes (60% of homes in American cities have unoccupied rooms). Bungalow helps use housing stock more efficiently, ensuring every room in each house is occupied. And because rooms throughout a typical single-family home differ in size, Bungalow is able to offer various pricing options to best fit the budget of every renter.
There’s certainly been some hand wringing about the onset of co-living as a new way of living in cities. And I think there’s some validity: a future where we all live in micro-pods in mega-complexes stacked on top of one another could definitely be the inspiration for a Black Mirror episode. (Maybe it already has?).
Our hope is that Bungalow’s business model is solving the same problem with a much more livable and human-scale version of communal living. We’re trying to make it easier and more rewarding for this generation to live in cities and develop strong social ties. We’re not asking them to accept a slew of “perks” in exchange for sacrificing personal space.
Was there a “tipping point” that led you to this idea? Can you tell us that story?
When I first moved back to San Francisco after business school, it took a few months and several weeks of couch surfing before I finally got settled in an apartment. In the two years that I’d been gone, my rent had doubled, yet every other element of the renting process had remained the same. My blinds that were broken when I moved in still hadn’t been fixed, we had to scramble to get new roommates off Craigslist every few months… the list goes on. Renting was my biggest expense, as it is for nearly every millennial, yet the experience was terrible. I thought, there must be a way to innovate this experience.
What do you need to lead this idea to widespread adoption?
Bungalow is growing incredibly quickly because there’s a huge demand in so many cities for more rental units. Homeowners (who are primarily baby boomers and empty-nesters looking to downsize without letting go of their assets) also love Bungalow, because it gives them a turnkey way to lease a home without the traditional risks and headaches. We’ll continue to scale rapidly as long as we keep providing an incredible experience for both homeowners and renters.
What are your “5 Things I Wish Someone Told Me Before I Started” and why. (Please share a story or example for each.)
1) How rewarding building your own company will be. It’s been amazing to see how an initial idea has evolved into something that actually helps our customers. Specifically, the connections we’ve seen form between our residents has been incredibly inspiring. We now have residents that have started businesses together and even a couple who met in a Bungalow that is now engaged!
2) How draining the initial years of a startup are. When you’re starting a company from scratch, and especially being a first time CEO, there is a big learning curve. Inevitably something goes wrong that you can’t anticipate, but it’s critical to work through it calmly to reach the next step.
3) How time-consuming hiring and finding the right people is. I easily spend 30–50% of my time interviewing candidates for our growing team. It’s significant, but having the right people on our team is crucial for the success of the business.
4) Culture is something you have to actively manage as the company grows and evolves. As Bungalow has grown from just my co-founder and me to now over 50 employees, it’s been a top priority of mine to maintain a consistent company culture that helps inspire our team and keeps them excited to come into work each day.
5) The importance of truly knowing your customer through every possible channel. When you’re in an industry like real estate where customer service is a key element, it’s necessary to truly understand the wants and needs of your customers. Whether that is meeting with them in person or collecting information via a survey, make sure to gather feedback at every point in the process. For Bungalow, a majority of our customers come from referrals, so it is imperative that we clearly communicate with our residents and address their needs so that they want to share their great experience with others.
The future of work is a common theme. What can one do to “future proof” their career?
We all know things are changing incredibly fast, including how we prepare to enter the job market, what jobs are available, and the very definition of a career path. It’s been said before, but staying curious and not getting too attached to any one way of thinking or doing things is crucial.
As an entrepreneur and CEO, I have to make sure my skill sets continuously grow and evolve, especially as new emerging technologies such as AI and machine learning impact all sectors. The residential real estate industry has been slower than most to be affected by these technologies, but it will happen.
Based on the future trends in your industry, if you had a million dollars, what would you invest in?
The future of the residential rental market and co-living are completely dependent on the evolving desires of our consumers. With this in mind, we’d put that $1 million towards improving the rental experience for both renters and homeowners by implementing more cutting-edge technologies. For instance, an AI-assisted compatibility roommate matching system or the development of an even more user-friendly mobile app. We’re also interested in finding ways to help both our homeowners and renters become more financially savvy since real estate is built on the foundation of personal investment and finance.
Which principles or philosophies have guided your life? Your career?
I’ve consistently operated in both my personal and professional life with a growth mindset. I’m always looking to take the opportunity that has the greatest potential for me to expand my own knowledge, which includes career moves — like jumping from product management at Facebook to starting my own company — outside my comfort zone.
Can you share with our readers what you think are the most important “success habits” or “success mindsets”?
I fundamentally believe unplugging and creating work/life balance is critical to success at any level. I like to select one day a week (typically Saturday, assuming there are no pressing projects), to unwind and relax. This typically looks like either a hike or going surfing in the morning to clear my head and then catching up with friends the rest of the day. This time “off” leaves me feeling more clear-headed when addressing important decisions and in turn, ultimately makes me more driven and productive.
I also encourage both my employees and myself to take an actual vacation when we take time off. No conference calls, no Slack, no email notifications — an actual break from being in the weeds of the business 24/7. Travel and time away help me reset and recharge, so I can come back to the office engaged, excited, and energized.
Some very well known VCs read this column. If you had 60 seconds to make a pitch to a VC, what would you say? He or she might just see this if we tag them 🙂
In just two years, Bungalow has become the largest and fastest-growing co-living startup in the country. Our unique business model creates a market between millennials who need a great home and baby boomers who own the existing housing supply, turning single-family homes into multi-unit rentals. We provide an immediate and affordable solution to keeping cities accessible to early career professionals, and we’re just getting started.
How can our readers follow you on social media?
Readers can find Bungalow at bungalow.com as well as on Instagram and Facebook at @livebungalow
Thank you so much for joining us. This was very inspirational.