Forbes, by Igor Bosilkovski
In 2014, Canadian Alexis Rivas and Ethiopian Jemuel Joseph were architecture students at The Cooper Union for the Advancement of Science and Art in New York. What the two of them realized was that building a high quality home was both time-consuming and expensive, primarily due to the fact that one needed an army of subcontractors and workers with specialty traits that had to coordinate with each other.
This led both of them to ask themselves: ‘why aren’t homes built in a factory?’
“Almost any other product in our lives, like cars, electronics, clothing or furniture is built in a factory,” Rivas says. “As a result of that these products are of high quality, are abundantly available, and are of great value.”
So, in 2014 Rivas and Joseph teamed up and started Cover, a company that designs, engineers, manufactures and installs backyard studios. Today, the enterprise cofounded by the two 30 Under 30 honorees from the Manufacturing section, announced they have raised a $10M Series A funding, led by Founders Fund and Lennar Corporation, with Valor Equity Partners joining as new investors. Existing investors General Catalyst, Fifty Years, and Khosla Ventures participated in the round.
The way Cover works is that it allows users to type their address on their website and the site will provide them with information on what they are legally allowed to build. From there, the potential client would pay $250, answer a questionnaire of 50-100 words asking them about the size (number of bedrooms and bathrooms) and preferences (whether they want a guest house or an office), and as a result receive three potential designs created by Cover’s algorithm.
If interested, the client would pick one, make small changes if they wish so, and pay $20,000 as a deposit. Cover would then manage the process with the city to get the permits, manufacture the studio in their factory in Los Angeles, ship the materials on a truck and assemble them on site.
“You can think of it as a set of high tech, life sized lego blocks,” Rivas says. “With this finite set of blocks we can create an infinite number of different designs.”
The price of the studio varies depending on the size, and is determined algorithmically as the design is generated (so far they have presented potential clients with 1,000 designs). For a small studio, such as a backyard office it can be between around $80,000, while for a two bedroom two bathroom design it can go up to $350,000.
The average size that clients choose per Rivas is 600 square feet, for which they charge around $230,000. The company only operates in Los Angeles at the moment, and Rivas says they are growing 2 times year over year.
Delian Asparouhov, a principal at Founders Fund said that the company at the moment follows the Tesla master plan.
“The first homes they are building now are the Roadster, they are at the higher end of the market, with a lot of early adopters that want technologically forward homes, and I think the goal is to get to our Model 3 as soon as possible,” Asparouhov says.
According to him, nobody else produces homes in a factory at a level like Cover.
“Henry Ford invented the assembly line for automobiles and that’s what made automobiles cheap and available for everybody,” Asparouhov says. “Nobody has done the assembly line in the world of homes and I think Cover truly is the first company to do it.”
Cover, which currently employs 30 people, came out of stealth in 2017, and has previously raised $1.7 million in seed in the same year