Inside an Airbnb cofounder’s latest venture: Building tiny backyard homes
In 2008, a few years after graduating from design school, Joe Gebbia cofounded Airbnb—and he believes the company succeeded because of its focus on design. Now he’s starting a new company with the same ethos but a different challenge: how to build better tiny homes for backyards.
Samara, the startup, began as an innovation studio inside Airbnb that looked for new products for the company and new ways to create social change. The team eventually began to focus on backyard houses, also known as accessory dwelling units, or ADUs. The first product, a net-zero tiny house called Backyard, is launching now, and Samara has spun out into a new business. “As the product progressed, it got to the stage where it just made more sense to be an independent company,” Gebbia says.
The prefab houses come in two sizes, a 430-square-foot studio and a 550-square-foot one-bedroom, and are intended to serve multiple uses. It’s a “flexible dwelling that can adapt to new ways of living,” Gebbia says. The percentage of households with multiple generations under one roof has more than doubled in the U.S. since the 1970s, and some people may use it as space for their in-laws. Others may use it as a home office, or space for creative projects, or as a rental. And yes, it could be used as an Airbnb, though the company isn’t promoting it solely for that purpose.
The houses can also generate more electricity than they use. “Our first step toward sustainable energy production is not to use very much,” says cofounder and CEO Mike McNamara. “So, first, we made it really tight, really well engineered, and really efficient.” It uses less than half the energy, the company says, of a standard house of the equivalent size. All of the appliances are electric, and the house can run off of a row of solar panels on the roof. An optional second row of solar panels produces extra energy that can be sent back to the main house, helping the homeowners save money.
The company handles the whole construction process, including surveying and getting permits. “We were really, really focused on trying to eliminate that friction through the design of the entire customer experience,” McNamara says. “And we think that in itself can create a lot more demand.”
Starting in 2016, California passed a series of laws aimed at making ADUs easier to build in the state by overriding local zoning and land use restrictions, recognizing that backyard homes could be one tool in addressing the housing crisis. Some cities, like Los Angeles, have also tried to spur construction of ADUs by experimenting with new methods of financing and other solutions. In 2016, 80 permits for ADUs were issued in L.A.; last year, there were 5,064. Still, the complexity of the building process is a hurdle for homeowners. Some other startups making prefab backyard homes, like a company called Abodu, also help with issues like permitting.
By one estimate, there’s room for 1.5 million backyard homes in California, and ADUs could be a major tool in tackling the state’s housing shortage. But that depends in part on how many are used as rentals rather than offices or Airbnbs. They’re also challenged by cost; a custom-built ADU in the Bay Area can easily cost more than $250,000. Samara’s studio starts at $289,000 and the one-bedroom unit starts at $329,000, including installation costs; McNamara argues that the quality is higher than what’s possible with traditional stick-built construction. But even in a region where average houses sell for well over $1 million, at this price point, it isn’t clear exactly how much ADUs can grow.
Samara also plans to later expand to other states, as they also start adopting new regulations to help build ADUs. “California’s just a glaring opportunity,” McNamara says. “There’s not enough housing units, and the cost of housing is extremely high. We have to find ways to get more units to the people and we have to find ways to get more units that are more approachable in price. So, that one is already here.”
(18)
