Speaker 1: Pushkin. Houses in America are too expensive. There are a
Speaker 1: lot of reasons for this. One reason that we've heard
Speaker 1: a lot about in the past few years regulations, regulations
Speaker 1: that make it hard to build enough housing in the
Speaker 1: places people want to live. But there are other reasons
Speaker 1: that we've heard less about. One other less discussed reason,
Speaker 1: building houses is an inefficient process, and it's not getting better.
Speaker 1: Over the past several decades. As so many industries got
Speaker 1: so much more productive and more efficient, home building stayed
Speaker 1: largely unchanged. People have been dreaming of transforming home building
Speaker 1: for like one hundred years now, dreaming of using modern
Speaker 1: industrial techniques to mass produce houses and bring down the cost.
Speaker 1: In the nineteen twenties, for example, Buckminster Fuller even started
Speaker 1: a company to do that, but it never really got
Speaker 1: off the ground, never really worked. In the decades that followed,
Speaker 1: other people tried similar things, and you know, we got
Speaker 1: mobile homes and we got manufactured houses, but nobody has
Speaker 1: really succeeded in fulfilling that vision that Buckminster Fuller had.
Speaker 1: No one has figured out how to make beautiful homes
Speaker 1: at scale in a way that is optimized for factory
Speaker 1: mass production. Someone could do it If someone could figure
Speaker 1: that out, it could go a long way toward bringing
Speaker 1: down the cost of houses in America. I'm Jacob Goldstein
Speaker 1: and this is What's Your Problem, the show where I
Speaker 1: talk to people who are trying to make technological progress.
Speaker 1: My guest today is Alexis Revas, co founder and CEO
Speaker 1: of Cover. Alexis problem is this, how do you build
Speaker 1: houses in a factory the way you build cars, and
Speaker 1: how do you do it so that a factory built
Speaker 1: house becomes cheaper and better than a traditionally built house.
Speaker 1: Cover is based in La in California, and like basically
Speaker 1: every other startup making physical things, they're following the Tesla model,
Speaker 1: starting with a low volume, high end product with the
Speaker 1: dream of scaling to the mass market. In other words,
Speaker 1: today Cover sells expensive backyard studios to rich people in LA,
Speaker 1: but their dream is to sell affordable houses all across America.
Speaker 1: Alexis was interested in architecture from a very young age.
Speaker 1: He told me he drew his first floor plan when
Speaker 1: he was in first grade. He went to college and
Speaker 1: studied architecture, and like so many people before him, he
Speaker 1: got captured by this dream of building houses in a
Speaker 1: factory and there are companies in America that build houses
Speaker 1: in factories now, and so Alexis went off to intern
Speaker 1: at one of those companies.
Speaker 2: I saw a problem with conventional construction and thought, well,
Speaker 2: what about building ups in a factory. So I looked
Speaker 2: that up and I actually went an intern for a
Speaker 2: company that built homes in a factory, so a prefab company,
Speaker 2: and they were basically doing it conventionally. It was like
Speaker 2: two by fours in drywall, right. But what happens is
Speaker 2: that when you add in the transportation, when you add
Speaker 2: in the overhead of actually running a factory, you know,
Speaker 2: to the customer, the price gains or the quality gains
Speaker 2: aren't really noticeable. It's not a meaningfully better product or
Speaker 2: a meaningfully cheaper product.
Speaker 1: Well, and is part of is part of the reason
Speaker 1: that the transportation is expensive. Because they're making it like
Speaker 1: a conventional house. It ends up like a three D box, right,
Speaker 1: They're not making like flat panels. It's not an ikea house,
Speaker 1: it's a It's a house that you put on the
Speaker 1: back of a giant truck that is very expensive to
Speaker 1: hire and us a lot to move. Is that part
Speaker 1: of the issue.
Speaker 2: That's definitely part of it. That's definitely part of it.
Speaker 2: And then and then once it gets to the site,
Speaker 2: because it's this large, you know, like you said, you know,
Speaker 2: almost container size, you know, or even bigger than a
Speaker 2: container size room that needs to be lifted into place.
Speaker 2: You need a massive crane and those cranes can be
Speaker 2: twenty thousand dollars a day, right, So that alone is
Speaker 2: a huge cost. If you need a creat for even
Speaker 2: one day, that's twenty thousand dollars.
Speaker 1: I just want to clarify one thing that I realized
Speaker 1: might be ambiguous, and that is we're not talking about
Speaker 1: mobile homes here, right, We're talking about houses that are
Speaker 1: manufactured in kind of a similar way. But it's a
Speaker 1: full house. It's not a mobile home. It's not like
Speaker 1: a trailer park house. It's a house.
Speaker 2: Correct, It's a house, and it's built to the same
Speaker 2: building code and building standards as a conventionally on site
Speaker 2: built home. Okay, And that's what I saw, and so
Speaker 2: you know, I saw a ton of opportunity to improve,
Speaker 2: right like I thought. I actually when I worked there
Speaker 2: thinking these guys have the solution to the problem. And
Speaker 2: I left that innership thinking this isn't the solution. And
Speaker 2: I actually started that's when I started researching all the
Speaker 2: other companies that were doing precou and learning about their approach,
Speaker 2: and no, everyone was basically doing the same thing, which
Speaker 2: was build homes in a factory but convention. And that's
Speaker 2: where I realized there was a huge opportunity to solve
Speaker 2: this problem. And that's when I started chatting with my
Speaker 2: co founder Jim Well, So, you know, went back to
Speaker 2: architecture school and said, hey, I think I think there's
Speaker 2: this huge problem. And there's kind of two parts to it. There's,
Speaker 2: you know, how do we build homes in a factory
Speaker 2: more like how cars are made, so like you know,
Speaker 2: true design for manufacturability, designed for scale, and designed for automation. Right.
Speaker 2: And then there's a second part, which is how do
Speaker 2: you do that? You know, while you're not building the
Speaker 2: same car or same home one hundred thousand times, there's
Speaker 2: some amount of variation that is necessary to serve the market.
Speaker 2: And this is where the customization comes from.
Speaker 1: Huh.
Speaker 2: Right, And I think so there's kind of two parts
Speaker 2: of the problem. Build homes like cars and uh and
Speaker 2: and enable some enough enough customization that you can actually
Speaker 2: serve a large enough market.
Speaker 1: It has to be more customized than a car, yes,
Speaker 1: but but kind of with the manufacturing principles of a car,
Speaker 1: where you think, not what is what is my dream car,
Speaker 1: but what is a car that is great that we
Speaker 1: could make a million of exactly the same.
Speaker 2: Exactly And so that's that's when we started chatting, and
Speaker 2: that's that's when we started Cover. So we started to
Speaker 2: cover while we were still in.
Speaker 1: And when was that? That was twenty fourteen, Is that right, correct? Yeah,
Speaker 1: so a long time ago. A key moment for me
Speaker 1: that's interesting both in the life of your company and
Speaker 1: in sort of the housing story more generally, is when
Speaker 1: California passes this law that makes it easier for people
Speaker 1: to put what's technically called an ADU, which is basically
Speaker 1: like a little backyard cottage or apartment on their house.
Speaker 1: Is that the right moment to talk about next?
Speaker 2: Yeah? So yeah, we you know, we we started the
Speaker 2: company while we're still in school, graduated, moved out to
Speaker 2: California the day after graduating, basically three months after graduating
Speaker 2: that law was passed, Okay, And interestingly, at the time,
Speaker 2: we had realized that instead of focusing to start on
Speaker 2: entire you know, single family homes, right, call it a
Speaker 2: two thousand or three thousand scriffed home. We should actually
Speaker 2: focus on backyard you know, little backyard offices or guest homes.
Speaker 2: We actually realized we should focus on this before that
Speaker 2: lock came out. Interesting because yeah, and the reason for
Speaker 2: that is is really, you know, taking the lean iteration
Speaker 2: process of a startup, and how do you apply this
Speaker 2: to this large, complex product. Well, start with the smallest
Speaker 2: possible version of that product you can, right, the.
Speaker 1: Minimum viable product. The minimum viable product is not a
Speaker 1: two thousand square foot house. It's a five hundred square
Speaker 1: foot studio with a bathroom.
Speaker 2: In a kitchen exactly. And so we realized that, and
Speaker 2: then turns out the timing was just perfect because this
Speaker 2: lock came out and we were already positioned, you know,
Speaker 2: we were like, we already have the website. We just
Speaker 2: have to you know, speak to this new regulation. And
Speaker 2: so the market for what we were focusing on, you know,
Speaker 2: I don't know what the number probably over one hundred
Speaker 2: x you know, within three months of us starting there.
Speaker 1: So it was just good luck.
Speaker 2: It was good luck. Yeah.
Speaker 1: Yeah, and like maybe a little bit like you're just
Speaker 1: kind of in the zeitgeist. Right, that's the non pure
Speaker 1: good luck part of it is kind of it was
Speaker 1: in the wind.
Speaker 2: Yeah. We had our investors, you know, basically reach out
Speaker 2: and say, did you guys like pass this law within
Speaker 2: three months and we're like, no, we wish we could
Speaker 2: take credit for it, but we didn't do anything there. Yeah.
Speaker 1: So okay, so now you've got a company, you got
Speaker 1: the laws suddenly on your side. What do you have
Speaker 1: to do to go from that moment to actually sell
Speaker 1: in somebody a backyard studio and putting it in their backyard.
Speaker 2: So really, what we wanted to do is prove to
Speaker 2: the world that not only could you build homes in
Speaker 2: a factory, you know, efficiently and at low cost and fast,
Speaker 2: but that you could build homes that are way better
Speaker 2: than conventionally built homes. So you know, high end, you know,
Speaker 2: kind of change people's perception of a home, of a
Speaker 2: prefabricated home, home built in a factory, to something that's
Speaker 2: that's actually desirable, that's better, right and noticeably, right, not like,
Speaker 2: oh yeah it's better in these three ways that you
Speaker 2: have to read on the on the brochure, right, No,
Speaker 2: it's actually used. Look at it. You're like, Wow, that's beautiful. Well,
Speaker 2: that's that's you know in the that it looks like
Speaker 2: you was built by a starchitect, right or or you
Speaker 2: know that kind of things. That's what we wanted to do.
Speaker 1: In a minute, why Alexis had to hire people from
Speaker 1: the car business to make Cover work and the problems
Speaker 1: Cover still needs to solve to sell factory build houses
Speaker 1: at scale. That's the end of the ads.
Speaker 2: Now we're going back to the show.
Speaker 1: So that's the that's the dream. Tell me about some
Speaker 1: of the things you had to figure out to do
Speaker 1: that to get from the idea to the thing.
Speaker 2: Yeah. I think one of the biggest realizations, you know,
Speaker 2: we're starting to build this. My co founder and I
Speaker 2: both have architecture backgrounds, and the more we built, the
Speaker 2: more we realized the reason that this problem hasn't been
Speaker 2: solved from within the architecture construction world is because some
Speaker 2: of the core skills that are needed to solve this
Speaker 2: problem aren't known and taught by most people in that world.
Speaker 1: Huh.
Speaker 2: And we realized that actually, if you want to build
Speaker 2: homes like cars, you need people that understand homes, but
Speaker 2: you also need a lot of people that understand cars.
Speaker 2: Huh to be part of the innovation process.
Speaker 1: What specifically are the sort of skills or knowledge that's
Speaker 1: that you need from the car industry.
Speaker 2: Yeah, I mean one big one is designed for manufacturability
Speaker 2: and designed for assembly. So you know, you don't just
Speaker 2: design the part for what it's going to do, what
Speaker 2: it's in the car. You design the part with how
Speaker 2: you're going to make it in mind, so that you
Speaker 2: can make it incredibly efficiently and a low cost and
Speaker 2: reliably and at a very high quality, consistent uh huh.
Speaker 1: And like it has to be exactly the same every time. Right,
Speaker 1: It's like a precision element I think of in cars
Speaker 1: that is probably not there in conventional home building.
Speaker 2: Right, that's right, even the units that you talk in right,
Speaker 2: Like you know, when I was an architecture school, people talk,
Speaker 2: you know, people talk, you know, oh, it's going to
Speaker 2: be within an eighth of an inch or even an
Speaker 2: eighth site tight, Right, Most people are like, you know, yeah,
Speaker 2: within half an inch, within a quarter of an inch, right.
Speaker 2: In in automotive you're talking you know how many thousands
Speaker 2: of an inch? Right? And so and actually at cover
Speaker 2: that's that's we talk in terms of Yeah, this tool
Speaker 2: has to have this many thousands of an inch precision.
Speaker 1: So it's orders of magnitude more precise. And that's because
Speaker 1: it just has to fit together automatically. You're not going
Speaker 1: to have a carpenter there to kind of just make
Speaker 1: it work exactly.
Speaker 2: And we actually we learned that the hard way, you know,
Speaker 2: that's exactly how we learned that this is a problem.
Speaker 2: We tried to build something ourselves. It didn't fit as expected,
Speaker 2: and as we kind of went and root caused it,
Speaker 2: we learned that, yeah, you know, being off by one percent,
Speaker 2: you know, in a degree over eight feet like that
Speaker 2: doesn't fit together at the end of the day. And yeah,
Speaker 2: if you need someone on site to then you know,
Speaker 2: send something or trim it down. That kind of defeats
Speaker 2: the purpose because now you're building it once in the
Speaker 2: factory and you're rebuilding it again once it gets to
Speaker 2: the site. So defeats the purpose. It has to just
Speaker 2: fit together right once it shows up on site.
Speaker 1: So you figure it out eventually, right you do. You
Speaker 1: are now making and selling little backyard homes or studios. So,
Speaker 1: I mean, one thing we haven't talked about in the
Speaker 1: sort of bigger why is home building inefficient? Why hasn't
Speaker 1: it progressed? Part of it seems like the regulatory piece, right,
Speaker 1: there's so many rules for construction permits you have to
Speaker 1: get in some places, it seems to be captured by
Speaker 1: the people who are being regulated.
Speaker 2: Right.
Speaker 1: So, as you are trying to figure out how to
Speaker 1: mass produce these studios, is there a regulatory piece you
Speaker 1: have to deal with?
Speaker 2: Because we're building homes in a factory, there's a state
Speaker 2: approval process for everything that's built in the factory, okay,
Speaker 2: And so that's something that we have a relationship with
Speaker 2: this agency. They go and look at our design and
Speaker 2: our way of doing things, and they actually look at
Speaker 2: our quality control process and our pulled control documentation. They
Speaker 2: approve that as an overall process, and then yes, we're
Speaker 2: an approved factory built home manufacturer. Okay, but we still
Speaker 2: have to submit and get approval for each home from
Speaker 2: the city. But the scope of what the city looks
Speaker 2: like looks at is smaller, okay.
Speaker 1: And the city you're basically selling in La now right,
Speaker 1: So when you say the city, is that basically of
Speaker 1: Los Angeles?
Speaker 2: Yeah, City of Los Angeles. Yeah, And and what they
Speaker 2: look at is much narrower. It's basically, are you even
Speaker 2: allowed to build this, you know, on this property? Where
Speaker 2: on the property is it going to be located? And
Speaker 2: is that acceptable? Right? And and things like how far
Speaker 2: is it from the closest fire hydrant, right, and what's
Speaker 2: the access like if there was a fire, you know,
Speaker 2: basic kind of safety things, right. And so that's the
Speaker 2: permitting process with the city, and they'll also look at
Speaker 2: the foundation, right. So so the majority of the actual
Speaker 2: building side of things is handled on the state level,
Speaker 2: and then the local specifics are handled at the city level.
Speaker 1: When did you sell your first thing, your first studio, the.
Speaker 2: First actual backyard home with a kitchen and bathroom, right,
Speaker 2: like a real home? That one we sold in twenty
Speaker 2: seventeen and then we delivered it in twenty eighteen. It
Speaker 2: took us a while to figure out the system and
Speaker 2: engineer the whole thing.
Speaker 1: And where are you too now, Like how many have
Speaker 1: you sold? How many do you sell per whatever, per
Speaker 1: month or per year however you look at it.
Speaker 2: Yeah, yeah, So we've built dozens of these, like, you know,
Speaker 2: well over thirty of them, you know, across LA. We've
Speaker 2: also built one in Joshua Tree. We've built dozens of them.
Speaker 2: And we're delivering homes every month.
Speaker 1: So let's talk about where the product and the process are. Now,
Speaker 1: how does it work.
Speaker 2: The way I think about is we have multiple production
Speaker 2: lines for different parts of the home. So you have,
Speaker 2: you know, a roof and floor panel production line, a
Speaker 2: wall panel production line, a cabinetry production line, and so
Speaker 2: these are running. We're making the individual parts, uh, where
Speaker 2: we're we're doing quality control uh and then and then
Speaker 2: we're getting the ready to ship and so these are
Speaker 2: these all gets shipped on regular flatbed trucks.
Speaker 1: The sort of output of the factory is like a
Speaker 1: bunch of like walls and roof panels and cabinets and
Speaker 1: they like and the and the and the walls have
Speaker 1: like pipes and wires in them. I mean, just just
Speaker 1: give me like a little bit more detail of like
Speaker 1: how this is actually working.
Speaker 2: Yeah, yeah, so so so yeah, it's it's on the
Speaker 2: production line. We're building you know, the structure. We're putting
Speaker 2: the insulation in, we're putting the waterproofing in. We're putting
Speaker 2: all of the connection mechanisms so that everything can can
Speaker 2: connect quickly on site, and and we're also putting in
Speaker 2: plumbing and electrical so.
Speaker 1: There are like pipes and wires just running through walls
Speaker 1: that you're building in the factory.
Speaker 2: Yes, okay, Yeah, the goal, right is to minimize the
Speaker 2: amount of complexity that you have to do on site.
Speaker 1: How long does it take to put the house together
Speaker 1: at the.
Speaker 2: Site we're right now, we're at about a month.
Speaker 1: About a month. That might be longer than I would
Speaker 1: have guessed. I mean, I'm ignorant. I don't know why
Speaker 1: I would have guessed less, but I was just imagining, like, oh,
Speaker 1: it's just a bunch of lego blocks and you get
Speaker 1: there and you're just snapping together.
Speaker 2: Yeah, and actually we're working on making it even faster, right,
Speaker 2: I think we can go even faster than that, and
Speaker 2: so we're working. That's when we say the reason we're
Speaker 2: not building one hundred homes per year, right or a
Speaker 2: thousand homes per year, is because we want to get
Speaker 2: it even faster before we go and scale not just
Speaker 2: on site but even in the factory. Yeah.
Speaker 1: So presumably the person the buyer already has what poured
Speaker 1: a foundation, and we do that as all of the
Speaker 1: hookups ready. That is that that's like before the house
Speaker 1: gets there from the factory obviously.
Speaker 2: Yeah, that's the foundation, the hookups, the utility hookups, that's
Speaker 2: all done before. We do manage that for our customers, right, huh,
Speaker 2: so that they just come to us and we take
Speaker 2: care of everything in the permit, the foundation, the manufacturing,
Speaker 2: the installation. But yeah, the the assembly itself is yeah,
Speaker 2: about a month.
Speaker 1: So what is that? What is that month of work?
Speaker 1: What are people doing for that month?
Speaker 2: Yeah, So so the structure goes up relatively quickly, like
Speaker 2: one or two days. And then and then you're waterproofing it,
Speaker 2: you're installing the windows, you're installing the interior walls U
Speaker 2: and then and then you're you have some plumbing, you
Speaker 2: have some electrical in but you've got to connect it all.
Speaker 2: You've got to connect it to the panel, right and
Speaker 2: connect that to the to the utilities. Actually we installed
Speaker 2: we we ship them with deducting and HVAC already installed, right,
Speaker 2: but you still need to make connections. Test those connections,
Speaker 2: make sure they're reliable. Right, go and install, and then
Speaker 2: go and install all the finishes, all of the interior
Speaker 2: interior wall panels, exterior finishes, you know, countertops, cabinetry, align them.
Speaker 2: That's one thing that that that takes quite a bit
Speaker 2: of time. And then and then while we do the
Speaker 2: first code of paint from the factory today, we do
Speaker 2: a finished code on site. And so that's another thing
Speaker 2: you know, that'll take a few days, right, you know,
Speaker 2: including letting it dry and all. It's still you know,
Speaker 2: that's still faster than conventional construction. But we can go
Speaker 2: even faster than that, and that's what we're working on.
Speaker 1: So you mentioned that you're still sort of trying to
Speaker 1: get the process right so that you can scale so
Speaker 1: that you can sell ten times as many houses as
Speaker 1: you're selling now or whatever. What's a thing in the
Speaker 1: process that you haven't figured out yet? What's the like
Speaker 1: a optimization problem that you're working on right now?
Speaker 2: Yeah, I'll give you some one, like the paint right,
Speaker 2: painting on site. To paint something well, it requires a
Speaker 2: good eye, it requires craft, it requires attention to detail,
Speaker 2: and so that requires sending a painter on site. You know,
Speaker 2: when you're building a car, you don't want to be
Speaker 2: reliant on someone's skill and craft aft. So one of
Speaker 2: the things that we're trying to figure out how to
Speaker 2: do is and we're going to is move the painting
Speaker 2: process into the factory and then ship things in a
Speaker 2: way where they're protected so that it all comes together.
Speaker 2: When people are moving around with their you know, the
Speaker 2: fridge or the cabinets and they accidentally knock on the
Speaker 2: or scrub past the wall, it doesn't damage the painting
Speaker 2: and require refinishing.
Speaker 1: And so you're talking about interior painting.
Speaker 2: Now, interior painting yet naively not.
Speaker 1: Knowing anything about it, I would think, well, you could
Speaker 1: just paint it at the factory. That shouldn't be that hard.
Speaker 1: But tell me why it is hard. I'm sure it is.
Speaker 2: I just yeah, we've done that. We've tried to do
Speaker 2: both cotes in the factory, and then what happens is
Speaker 2: that they get scuffed along the way right, or or
Speaker 2: you know, there might be something that you know, one
Speaker 2: part doesn't fit together and so you need to trim
Speaker 2: it and that creates dust and I have dust all
Speaker 2: over it, right, that kind of problem.
Speaker 1: Is there some kind of like industrial scale sort of
Speaker 1: saran wrap? Could you paint it and then put like
Speaker 1: a plastic film over it and then not remove the
Speaker 1: plastic film until the end.
Speaker 2: Yeah, exactly right, that's that's the solution, right.
Speaker 1: Probably not, but I don't know anything That's what came
Speaker 1: to my mind. I mean, what have you tried.
Speaker 2: I mean, we've tried just painting for the factory. That
Speaker 2: doesn't work right. We've tried kind of protecting it in shipping.
Speaker 2: And while that helps right from the shipping process, you know,
Speaker 2: once you even saw it on site, there's some challenges there. Right,
Speaker 2: a film right might not cut it right some of
Speaker 2: the Sometimes what happens is, you know, that might help
Speaker 2: for eighty percent of the scuffs, right, but if you actually,
Speaker 2: let you know, moving a fridge and you hit the
Speaker 2: corner of the fridge, that's going to create a bit
Speaker 2: of a dent. So there's many things like that. It's
Speaker 2: not like there's one big thing that takes a ton
Speaker 2: of time. It's it's really like hundreds of small things
Speaker 2: that need to be figured out and and from a
Speaker 2: process standpoint and from a product standpoint to make this
Speaker 2: you know, much more like like a car.
Speaker 1: So let's talk about let's talk about cost and price.
Speaker 1: What does one of your backyard studios costs today?
Speaker 2: You know, for a unit that has like a bedroom,
Speaker 2: a bathroom, a kitchen, right, like a fully functional living space.
Speaker 2: While you can go smaller and get under three hundred
Speaker 2: thousand dollars. Most of them are going to be over
Speaker 2: three hundred thousand.
Speaker 1: Over three hundred thousand, so but that's.
Speaker 2: All in that includes the sixiensive.
Speaker 1: I mean, the median price of a home in the
Speaker 1: United States is somewhere around there. So like, yes, you're
Speaker 1: you're building an expensive backyard home.
Speaker 2: Now we're starting off with a product that's very high end, right,
Speaker 2: Like we've we include like sub zero wolf appliances, right,
Speaker 2: which you know that a fridge and an oven there
Speaker 2: can be fifteen thousand dollars, right, just just that, right,
Speaker 2: So it's very high end, and we're proving to the
Speaker 2: world that this is better than conventional construction. And then
Speaker 2: as we ramp up production, as we build more and more,
Speaker 2: we will lower the cost and be competitive with you know,
Speaker 2: mass you could build the same home, like the typical
Speaker 2: American home for the same price, right, Like, that's where
Speaker 2: we want to get to.
Speaker 1: For you to get from where you are now to
Speaker 1: where you want to be to building full size houses
Speaker 1: for people who are not rich, you need to get
Speaker 1: better at building the houses, and then the world needs
Speaker 1: to discover you and want to buy your houses. Right,
Speaker 1: those are the two sides. So one side of that
Speaker 1: is you getting better at building those houses. You mentioned
Speaker 1: painting as an example of a thing you have to
Speaker 1: get better at. What's another example, Yeah, I.
Speaker 2: Mean another example is actually on the supply chain side.
Speaker 2: So a lot of our supply chain historically has been
Speaker 2: what I would call a prototyping supply chain. Who's close,
Speaker 2: who can get it done fast, and who can we
Speaker 2: basically go, you know, just drive to and if we
Speaker 2: have feedback or we need to make changes because what
Speaker 2: we've optimized for is speed of iteration. Huh right, But
Speaker 2: as we scale, one of the biggest changes we need
Speaker 2: to make is to say, you know what, we're gonna
Speaker 2: lock down this design, not forever, but we're gonna say
Speaker 2: we're gonna build one hundred that are gonna be the same.
Speaker 1: Yeah, we're gonna stop, We're gonna stop monkey in with it.
Speaker 1: We're gonna stop iterating on this one thing for a while.
Speaker 2: For a while. So we order one hundred the same parts.
Speaker 2: And when you order a hundred parts from a supplier
Speaker 2: versus you know ten, right, it's a huge difference in costs.
Speaker 2: I mean, you're talking about you can you can reduce
Speaker 2: the cost sometimes you know, fifty percent sometimes even more?
Speaker 1: Right, And so are you there? Are you there yet?
Speaker 1: Are you ordering one hundred at a time?
Speaker 2: Now, we're close, We're close. We're now setting up the
Speaker 2: long term supply check. Okay, we're kind of taking the
Speaker 2: product from this prototyping phase to hey, we're ready to
Speaker 2: scale this. Let's let's go build thousands of homes. That's
Speaker 2: where we are.
Speaker 1: So so then there's the demand side, right, Is that
Speaker 1: the other piece of people have to want to buy
Speaker 1: these houses from you?
Speaker 2: Yeah, people have to want to buy these homes from us. Fortunately,
Speaker 2: there because we have a product that is much better
Speaker 2: than conventional construction. Even at this price point. We've we've
Speaker 2: always had a backlog of orders.
Speaker 1: So is the only thing keeping you from selling full
Speaker 1: size houses right now your own desire to make your
Speaker 1: process better before you do that?
Speaker 2: Yeah, it is. It's it's the it's kind of like,
Speaker 2: you know, nail it and then scale it.
Speaker 1: Did you make that up? Or is that a thing
Speaker 1: people say? Is that like a y Combinator thing?
Speaker 2: I didn't make that up. An investor friend said it. Actually,
Speaker 2: it's like we love the nail it scalet approach. It
Speaker 2: summarizes it. Well, when you.
Speaker 1: Put it that way, it sounds binary. It sounds like
Speaker 1: there will be a day when you're like, okay, let
Speaker 1: a rip. But you know, the real world is often
Speaker 1: not like that. Do you have a moment in your mind.
Speaker 1: Is there a thing you're trying to get to when
Speaker 1: you say like, okay, we know how to do this
Speaker 1: well enough that we can we can let a rip.
Speaker 2: Yeah. The focus is really on the on site assembly
Speaker 2: side of things. There Once that process can basically be
Speaker 2: done by anyone. Right, So this is not necessarily people
Speaker 2: that have extensive construction training. Right, we can you and
Speaker 2: I can go build it, or you know, are as
Speaker 2: someone who's currently working at Starbucks or at a restaurant.
Speaker 2: You know, as long as they want to work with
Speaker 2: their hands and and can you know, follow the instructions. Well,
Speaker 2: anyone can build a cover. Once it's at that point,
Speaker 2: the installation side of things can scale very well.
Speaker 1: Oh right, because that's is that the binding constraint now,
Speaker 1: I mean you were talking about the bottleneck is the
Speaker 1: real bottleneck Now the skilled labor you need to install
Speaker 1: the house on site once it's out of the factory.
Speaker 2: It is and and for most PREFIX companies even the
Speaker 2: ones where they're shipping entire rooms, that on site process
Speaker 2: still takes you know, they say, oh, it assembles in
Speaker 2: a day, but really really what they do is they
Speaker 2: put the parts together in a day, but then they
Speaker 2: spend four weeks patching it up or six weeks thatching
Speaker 2: it up. So even when they're shipping room size pieces,
Speaker 2: that that's the bottleneck. And so yeah, that's the focus
Speaker 2: is making it so that you know, that won't be
Speaker 2: the bottleneck because then the complexity can mean the factory.
Speaker 2: But there's a playbook for making factories more efficient, right,
Speaker 2: Like any company that's had to scale up production has
Speaker 2: had to learn how to make factories more efficient. So
Speaker 2: there's much more of a playbook for how to do
Speaker 2: that than there is for how to scale what's going
Speaker 2: on on site.
Speaker 1: Right, So the the real process improvement you need to
Speaker 1: figure out is what can you change in your in
Speaker 1: the factory manufacturing process so that assembling the house on
Speaker 1: site requires less skill.
Speaker 2: That's right, and and and the result of that is
Speaker 2: that it's also faster. But yeah, exactly.
Speaker 1: At a certain level, what alexis uncover are trying to do,
Speaker 1: you know, designing this thing so that it can be
Speaker 1: made in a factory, so you don't need high skilled
Speaker 1: laborers to assemble it on site. It reminds me a
Speaker 1: little bit of the original Industrial Revolution in England more
Speaker 1: than two hundred years ago now, where they did something
Speaker 1: quite similar, but instead of doing it with houses, they
Speaker 1: did it with cloth. That moment, you know, figuring out
Speaker 1: how to produced something for cheaper with machines. That's really
Speaker 1: the beginning of this era of technological progress that we've
Speaker 1: been living through ever since. We'll be back in a
Speaker 1: minute with the Lightning round, including Alexis tips for designing
Speaker 1: a small space that doesn't feel that small. Now back
Speaker 1: to the show, let's finish with the Lightning Round. I'm
Speaker 1: just gonna ask you a bunch of questions. Yeah, I
Speaker 1: read that you canceled all meetings for everybody at your
Speaker 1: company on Tuesdays.
Speaker 2: Is that true?
Speaker 1: It's true? So why Tuesdays?
Speaker 2: I Actually I wasn't like big on the Tuesday. The
Speaker 2: Tuesday thing was just that we had to pick a
Speaker 2: day and I just had to Hey, it's either gonna
Speaker 2: be Tuesdays or Thursdays, and we put it up to
Speaker 2: a vote, and Tuesday one, surprisingly by like seventy percent,
Speaker 2: So I was like, Okay, let's do let's just do Tuesdays.
Speaker 1: Who's the most overrated architect of the last one hundred years.
Speaker 2: I think there's I think Frank Garry. Honestly, I think
Speaker 2: Frank Aarry. There there's some I will say, there are
Speaker 2: some very impressive things that he has done from a
Speaker 2: technology standpoint, right as far as how his building, because
Speaker 2: there's such crazy.
Speaker 1: Metal that looks like it's like rippling in the breeze
Speaker 1: or whatever.
Speaker 2: Yeah, exactly, and and and and that metal actually like
Speaker 2: they've done some pretty innovative stuff on it. So I'd
Speaker 2: say from from a technology standpoint, he's actually very impressive
Speaker 2: and inspiring. But but I just don't see why buildings
Speaker 2: need to look like, you know, scraunched up napkins. Like
Speaker 2: why this is controversial, but you know why.
Speaker 1: I like it. So, who's the most underrated architect of
Speaker 1: the last one hundred years?
Speaker 2: Oh? Uh, underrated, I'd say, you know, Knees, Vandero and
Speaker 2: Lac Corboussier. So by no means underrated. They're i think
Speaker 2: highly respected within the architecture world. But outside of the
Speaker 2: architecture world, a lot of people don't even know about them, right,
Speaker 2: And they One of the things that I think was
Speaker 2: really really interesting about the work that they did and
Speaker 2: the vision that they set out for the world was
Speaker 2: they looked at the car as kind of this thing
Speaker 2: that we should aspire to in architecture in terms of
Speaker 2: making it affordable to people, making it a mass market product.
Speaker 2: And actually they talked a lot about the vision of
Speaker 2: factory made homes so that you could have incredible homes
Speaker 2: for everyone. And I think a lot of that has
Speaker 2: been lost.
Speaker 1: From your professional experience. What do you understand about houses
Speaker 1: that most people don't?
Speaker 2: Yeah, I think I think one thing there is is
Speaker 2: not all square feet are created equal. And like the
Speaker 2: degree to which this can be true shocks people sometimes, right,
Speaker 2: people look at like, oh, how many square feet is
Speaker 2: this home? Like you can have a thousand square foot
Speaker 2: home that feels smaller than a six hundred square foot home.
Speaker 1: Huh.
Speaker 2: And and and I'm not I'm not exaggerating. So there's
Speaker 2: a lot that you can do from a design standpoint
Speaker 2: to make small spaces feel bigger. Right, So you know, again,
Speaker 2: less is more, right?
Speaker 1: What's one way to do it? What's like one tip
Speaker 1: for optimizing your your space.
Speaker 2: Yeah, large windows is huge, large Florida ceiling windows. And
Speaker 2: then and then just good layout where you don't have
Speaker 2: a bunch of wasted space and kind of like transition
Speaker 2: like hallways right or foyer's right, like you kind of
Speaker 2: don't think about that space because you don't use it
Speaker 2: all the time.
Speaker 1: Do you think you'll run cover for the rest of
Speaker 1: your career?
Speaker 2: That's all I want to do. I want to build
Speaker 2: awesome homes and you know, whether it's backyard homes, single
Speaker 2: family homes, multifamily that that's all I want to do. Yeah.
Speaker 1: Alexis Revis is the co founder and CEO of Cover.
Speaker 1: Today's show was produced by Edith Russello, edited by Sarah Nicks,
Speaker 1: and engineered by Amanda Ko. You can email us at
Speaker 1: Problem at Pushkin dot fm. I read every email. You
Speaker 1: can also find me on Twitter at Jacob gold STEAE.
Speaker 1: I'm Jacob Goldstein and we'll be back next week with
Speaker 1: another episode of What's Your Problem.