January 26, 2017 Corey Smith

Starcity: The Future of City Building

Jon Dishotsky and his team at Starcity want to build the cities of the future. Part dreamer, part urbanist, and part developer, Jon and Starcity are taking a new approach to the housing creation conversation. How can we make sustainable, enjoyable living environments for everyone? Recently, Starcity was in the Summer 16 batch in Y Combinator and we asked Jon about his path to today, and what’s next.

Photo from left to right: Josh Lehman (Chief Technology Officer), Mo Sakrani (Chief Product Officer), Jon Dishotsky (Chief Executive Officer), Jesse Suarez (Chief Operations Officer), Meg Bell (VP of Community), Josh Petersen (VP of Asset Development)

How did you get involved in development?
It started on one of our first family trips back to New York was when I was around 5 years old. We lucked out and got upgraded to a night at the Waldorf Astoria (we normally were a camping family) and there was a huge thunderstorm. I stayed up all night in awe of the buildings and sounds of taxis. I fell in love with cities that night and never fell out of love. I dreamed of one day building them…

My first career was as a real estate broker at Cushman & Wakefield and my first client was one of the early Y Combinator companies Scribd. I was close friends with the founder from growing up in Palo Alto and they were doing well out of the recession and needed a lot of real estate work. The work was fun and I developed some good friendships in the community and this helped me make a career out of it and gain an understanding of real estate development.

Deep in my subconscious though, my parent’s hard-wired values of social justice which  was starting to bubble over. In 2015 I pushed the reset button after a decade to figure out what I really wanted to do. At first, I was like Tom Hanks on a deserted island. I released an independent film and grew a beard. But before long, the aspiration to make a positive impact and drive change became clear. I knew what I had to work on. Making great cities more accessible to more people.

What is Starcity and what do you do?
Starcity is a home builder. We were founded in May of 2016 and were recently in the Summer 16 batch in Y Combinator. We have a small, insanely great team of 6. Our first prototype is a comfortable, communal home in San Francisco. It’s designed for individuals seeking to share resources and experiences, thereby reducing footprint and social isolation.

Our customers and friends may not know, but our plan is to build urban communities for everyone – couples, families, and other domestic arrangements. Our mission is twofold: 1) Make living in great cities accessible to everyone. 2) Make the living arrangements delightful and sustainable so that people can stay in cities for the long-term. We will do this by redefining the meaning of home. Innovative interior-design that increases livable space and smart technology that reduces waste will be at our core.

We’re initially focused on San Francisco because it’s home and we love this city – its rich history and culture and the positive changes of the past decade. We are using an age old technique of adaptive re-use to convert existing, vacant commercial stock into new supply of communal homes. In keeping with a high velocity start-up, all free cash flow is plowed back into R&D to drive down the costs and bring the follow on products to market as fast as possible.

Why do you think SF housing is so crazy and how can it be fixed?
Many people like to blame policy, regulation and anti-housing forces. I can understand that sentiment but I don’t think it tells the full story. The rent in San Francisco is very high, everyone accepts it as a fact of life. I remember overhearing a conversation in a coffee shop in New Orleans where two people were working on laptops, enjoying an espresso. They were talking about moving to San Francisco but both agreed it was too expensive to move there. That broke my heart. I wanted to walk over to them and say, “I will put you up for a few weeks!” (Not sure my wife would have been stoked about that).

The challenge is that there are many smart people that come here want to work on software or businesses that support software. This is the mecca of software, after all. I don’t blame them. The physical world has lots of challenges and is very expensive. Those challenges always include gravity, physics, zoning, and sometimes include politics, emotions, and fear. In order to experiment with new ways of building housing you would have to…build housing. That seems obvious but it’s an important point.

If you build software, you can write code and put a product out there quite quickly and cheaply. The constraints are limited. That is not to say it’s not challenging, however the cost to achieve minimum viable product in software vs. a physical building is two or three orders of magnitude in difference.

Paul Graham, the founder of Y Combinator, says about problems like this, “There are great startup ideas lying around unexploited right under our noses. One reason we don’t see them is a phenomenon I call schlep blindness. Schlep was originally a Yiddish word but has passed into general use in the US. It means a tedious, unpleasant task. No one likes schleps, but hackers especially dislike them.”

There are many great people working on housing. We need way more. I think we can all agree there are enough photo sharing apps.

What are you looking to accomplish in the next year?
Product-market fit, which basically means – do many people want what we’re building and if so, can we scale it? We also want to answer the question – since our distribution model is unique and we shepherd demand with a consumer internet platform, how sticky is our demand, and how scalable is that delivery model? Also, we have a few communities going through planning, so…entitlements!  A boy can dream…

SFHAC is thrilled to have Starcity as a member so we can work together on pro-housing solutions for the Bay Area. Learn more about membership here.

Corey Smith

Corey Smith is HAC's Executive Director and can be reached at corey@housingactioncoalition.org.

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