Invest Like The Best
Episode 326 A New Blueprint for Homebuilding
Invest Like The Best

Episode 326: A New Blueprint for Homebuilding

Invest Like The Best

Episode 326

A New Blueprint for Homebuilding

Alexis Rivas is the co-founder and CEO of Cover. We cover what modular homes and LEGO have in common, how Cover is attempting to defeat the twin-headed hydra of housing shortages and inefficiency in the construction industry, and what this means for the future of buying homes.

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(00:01:41) - (First question) - Supply and demand situation writ large for housing in the United States

(00:03:12) - Truth about housing shortage distribution 

(00:04:36) - Lack of workforce growth to meet housing development needs

(00:06:29) - Big picture solutions involving technology to enhance development needs

(00:08:25) - Insight into “lego piece” style construction

(00:09:43) - The comparison between automotive manufacturing advancement and the lack of technology in prefab home manufacturing

(00:11:48) - Material insights that contribute to better prefab homes

(00:14:17) - Strategic description of a good “lego piece” from Cover

(00:17:49) - Scale of panel size for reference

(00:18:10) - Utility continuity comparison between panels versus tradition construction

(00:19:07) - Potential criticism from skeptical contractors

(00:20:55) - The marginal cost for a typical home buyer

(00:24:01) - The role of software in the business

(00:26:49) - Insight into support model and “The Last Mile” theory in construction and possible solutions to combat errors during assembly

(00:28:48) - Support system integration for inevitable repairs

(00:30:19) - The changing reality of initial ideas as projects are completed

(00:32:29) - Building factories and streamlining production logistics

(00:34:29) - The effects of research and study that have improved the company concept goal

(00:35:30) - Focusing on constraints and an example relatable to real life scenarios

(00:36:39) - The value of moving slow to perfect processes early on versus an all in head first approach

(00:38:11) - The scope of ambition over the next several decades

(00:39:20) - The evolution of homes and how they could change based of consumer wants

(00:41:39) - Vertical capabilities of cover panels

(00:42:07) - Capital efficiency and economic strategies with business cash flow in mind 

(00:43:21) - Types of panels that could be introduced moving forward

(00:41:47) - Additional information gained from studying the housing development industry

(00:43:16) - Timeline for Cover expansion into new states

(00:44:08) - Advice for upcoming entrepreneurs when building similar business models

(00:46:00) - The kindest thing that anyone has ever done for Alexis

A New Blueprint for Homebuilding

Introduction

Patrick
My guest today is Alexis Rivas. Alexis is the Co-Founder and CEO of Cover, which is pioneering a new way of building homes. It's no surprise to anyone that aspects of our housing market is broken. The market is undersupplied and littered with regulatory issues. The homebuilding process has also not changed for the better part of a century. Alexis is attacking the problem and has taken a leaf out of the car industry's learnings to create a similar production process for homebuilding.

In our discussion, we talk about his idea of LEGO pieces for homes, how they're refining production with backyard homes first, and how this may change the way people buy and sell homes in the future. Please enjoy my conversation with Alexis Rivas.

The Giant Problem Cover Is Trying To Solve

Patrick
So Alexis, this topic has been really interesting to me lately, especially after I discovered Cover and all that you're up to. And I thought the right way to frame this conversation would be to start very, very broad and very, very narrow with very specifically what Cover is doing and building. I'd love you to give your interpretation of like the supply and demand situation for housing in the United States writ large. When you approach this market, which is obviously enormous and this problem, what stands out to you after your many years of investigating it?

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