At ‘Hacker Hostels,’ Living on the Cheap and Dreaming of Digital Glory
nytimes.com
nytimes.com
More than half of Chez JJ residents who have applied to YC have been accepted. Maybe it helps that we grill each other. Or maybe it helps that we help each other relax in order to see the big picture. Or because our residents don't have to waste as much time on the minutiae of living because of what we provide. Maybe it's a form of self selection. It is a relevant point that living in group communities is more cost effective than living alone. When we all pitch in towards basic needs we are able to have a higher standard of living.
We have weekly professional cleaners and subscribe to Farm Fresh, an organic vegetable delivery service. We provide coffee, tea, pancake mix, cereal, soymilk, and all the fresh fruits and vegetables you can find in our garden. We have regular dinner parties, and breakfast brunches. We have movie nights and hackathons and play board games. And we work closely with the owners of each of our houses know exactly what we are doing and are completely supportive.
Keyword: New York Times, Crammed Into Cheap Bunks, Dreaming of Future Digital Glory
Faruq Hunter
It's hard to make people envision something else, once the words are out there, but we really aim to make life as frictionless as possible for our guests.
Would I do it long-term? Probably not. Did it work for me? Absolutely.
What real significant tangible benefit are these people getting that compels them to live like this and pay a relatively high cost for the privilege? $1,200/month or less gets you your own private room in a shared apartment in NYC, Boston, or just about anywhere else.
Why do people go to clubs to dance? You can do it anywhere even at home, by yourself. But it's just more fun to do with other people who love to dance too.
I go to cafes here and it's not unusual to see people coding, discussing startups, practicing their pitch. Almost everybody I know is building something. Not working for a big company is like a badge of honor.
Nobody is claiming that the Bay Area is the only place for innovation but it is where most innovation happen.
That's honestly the most compelling argument I've heard for SF/SV.
That said, I'm not planning on moving to SF/SV any time soon. I'm a bit older now ... getting ready to nest, buy a house, etc. I have friends who have bought starter homes in the Bay for the price of mansions in other parts of the US. I might be making a mistake but that's my plan too.
I feel confident that I could meet dozens of new cool and interesting people a month if I wanted to. I don't know if I would click as much with people in other locales (not even NYC - too neurotic for me).
Because they want to get laid?
My original point really wasn't about cleanliness or food, but about the true, measurable value that SF/SV brings. I don't know why people are compelled to travel from (for example) Toronto to live in a single dorm room with nine strangers, some or all of whom may snore. I imagine the people who stay will likely have their freedoms greatly restricted, even down to their choice of sleep schedule. I can only imagine the alternative would result in people disturbing each others' sleep.
The whole "gotta be in SV/SF" mentality seems to be a product of massive amounts of hype that's driving these people to live in such relatively poor conditions for a relatively high amount. I just don't understand why people are acting like this.
Quiet hours start after 10 PM or as soon as people start heading to bed. We do occasionally have snorers, and provide ear plugs. Everyone seems to do well on multiple sleep schedules so long as late movement towards bed is sufficiently quiet.
We choose our locations based on easy access to public transportation and easy access to hacker circles. The prices are higher because the demand is higher. There are community houses everywhere, and I occasionally see rooms for rent in East Palo Alto community houses. There are many around, and it isn't just for hype. It's very expensive to live here and it gets easier when living in groups.
I'm not entirely convinced of the merits of this 10-person dorm for twice the cost of a room on Craigslist in the same neighborhood, but my skepticism (a deep, penetrating British skepticism!) is for something I've not tried.
If you want to compare it to something, compare it to airbnb listings - and this is perfectly in line with market rates. Typical rooms cost $80-120+ if you want your own room. A shared room at $40 makes a lot of sense - if you are ok with those living conditions.
I did a quick search on Airbnb for private rooms in the Castro neighborhood (which is where their SF location is) that don't exceed $40/night and there are 34 results. [1] This "hacker hostel" isn't in line with market rates if they're putting 10 people in each room.
For reasons I cannot fathom, if I bump the max price for the above search up to $45, only eight listings are returned.
[1] http://www.airbnb.com/s/Castro--San-Francisco--CA?room_types...
>> $1,200/month or less gets you your own private room in a shared apartment in NYC, Boston
In much of the US, $1,200/mo will buy you a house (or rent one). $1,200/mo is a fairly high rent for a 1-bedroom in much of the US; a private room in a shared apartment would obviously be correspondingly less.
As a graduate student at Berkeley, I had my own room in an apartment with a roof deck and uninterrupted bay view for $400/mo on a month-to-month lease in a great neighborhood. This was 6 years ago, but the same guy was still subletting the same rooms for the same price, when last I spoke to him.
When I moved to the peninsula to work at Apple, I had a small house with a yard and fruit trees in the nice part of Menlo Park on a month-to-month lease for $1000/mo. This was 4 years ago, but similar deals can definitely still be found (the same house was rented for $1300/mo recently).
Up to a year ago, my wife and I shared a lovely house with 1.5 acres in Palo Alto for $1800/mo, though we did need to sign a lease for that one.
When I travel back to the bay area now, I get an airbnb-type room in Palo Alto, and don't typically pay more than $800/mo short-term. A lot of things are listed at higher rates, but you can often negotiate pretty successfully. It certainly doesn't hurt to ask.
The ridiculous rents that you hear about in the bay area are partially due to a genuine real estate crunch, but they are largely also due to people having too much money and not enough sense. Paying $1200/mo for a dorm is nuts, no matter what city it's in.
Having lived in SV all my life, these "Hacker Hostels" just seem like a way for the operators to exploit those who flock to their services, who just don't know any better.
No problem if they stay there for a couple weeks, up to a month, while getting situated or doing a bunch of meetings, but living there for months shows lack of judgement. You can get a hotel in Santa Clara- rack rate- for $50, and a nice one at that.
This is like asking the success rate of an actor/actress in LA versus in other cities.
One of the major benefits that's routinely touted is access to VC/angel. Something that most people forget is that the odds of getting such investment are relatively small and most start-ups thrive without it.
If you want to increase your likelihood to get funding, you have to be here in the Bay Area.
I'm not sure why charging people is considered to be a shocking idea. A business is supposed to charge people, or find another way to make money, such as smothering eyeballs with advertising. I'd rather have a profitable company that has positive cash flow and a sustainable growth rate than a "big" company with a ton of freeloaders and external investment.
If you're going to cite Twitter and Facebook as an example, the odds of you creating a similar company are akin to finding Willy Wonka's golden ticket.
VC just isn't available or necessary in the vast majority of cases, negating the need to be in the Bay Area. Bear in mind that VCs are all over the place, from Boston to New York to London. The benefit you cited elsewhere that it's fun to be in the Bay Area is, however, the most compelling.
The only true blue benefit I can see to even being in the US is access to better payment solutions, and possibly a culture that better supports brazen entrepreneurialism.
[1] http://www.quora.com/Venture-Capital/What-are-the-odds-of-ge...
A few thoughts. One obviously is taking the social proof of what others are doing and copying it.
The other is that "if you don't have anything good to say, don't say anything at all". So having revenue of $0 is better than having revenue of $15000 (2nd number arbitrary just trying to illustrate that by showing a number you are likely to be judged differently then if you never charged at all and can point to eyeballs or signups and have the focus on that).
Most people I know doing startups especially in the Bay Area want that golden ticket. Odds are very low but that's what people aspire for.
Taking it to basketball analogy.
There are millions of basketball players out there and all of them aspire to one day play in the NBA. Chances are slim since there are only about 450 players in the NBA in a given season.
But you are pitching more than 1 VC.
Rose said "VCs invest in roughly 1 out of 400 companies who pitch them." and it's obvious he means "an individual VC".
Most importantly (something I try to point out with respect to dating as well or anything where success is essentially "1") you are looking for 1 person/firm to believe in you.
There are exceptions, but that's the general model and people have made billions with it so arguing against it is an uphill battle.
http://www.amazon.com/gp/product/B008035HQQ/ref=as_li_ss_tl?...
It does look like an interesting book though and I'll grab a copy.
Lest we forget, the old way of charging for something still works. In fact, with the internet, it's extremely easy to reach a huge international audience. Customers don't give one shit where you live.
If you are trying to get a lot of big investors for your social platform that has to explode, sure, SF/SV is probably the absolute best for that, but you can start a business anywhere.
But if you just step off a plane at SFO and walk around, you're not guaranteed to find people doing startups, especially if you don't know which coffee shops they frequent. Speaking from experience, staying at somewhere like Chez JJ means an instant connection to a community of smart and similarly-inclined people. It really is great for folks new to the Valley ("on the bottom rung"), and I think the article got at least that point correct.
It's very hard to find housing if you're going to be somewhere for just a few months, so AirBnB is there for those short stays and it's better and cheaper than a hotel, and a good way to meet people in the area.
You shouldn't really compare it with finding a place for good because that's not what it's for. I live in the area and have tried to find a short stay for a previous 3 month internship. It's very hard, and I had the luxury of being able to stay with my parents while I looked as I grew up within driving distance. However, I would imagine doing that from a distance would be next to impossible.
There is a significant "plan b" by doing that that you have to consider as well as a benefit over being somewhere else because of the concentration of like minded people. Many who will go on to achieve success.
You are around others who are doing things and you are making connections. If your thing doesn't work, you know people who now know you and you can get involved with them if your idea doesn't work out if they feel you have talent. (And vice versa). That's a huge benefit.
The article just mentioned it's $40/night - that's not too bad considering no long term lease is involved.
I absolutely believe it's worth it. In fact, I predict the hostels will increase their price as they become more popular (they should send a thank you note to the NYT).
I'm not sure it is worth it and cramming 10 people in a room for $40/night feels exploitative, particularly as there are many options nearby that cost less and come with a private room. [1]
They're making a decent amount of cash from this and they're shrewd business people if they're able to rent out a single, sparse room for somewhere between $11,000 to $12,000 per month, just by positioning it as for hackers! I have a lot of respect for their marketing and business savvy!
[1] http://www.airbnb.com/s/Castro--San-Francisco--CA?room_types...
$1400/month gets a one-bed apartment in Mountain View. I used to pay $700/mo for a private room and bathroom in a 2 bed apartment in Mountain View. Those prices seem over hyped.
> When the site started in May, $12,000 in orders for a car diagnostics device poured in right away. PayPal, which the founders used to process payments, decided their account was “high risk” and suspended it, freezing their money for six months, Mr. Wu said. Mr. Wu and Mr. El-Hage maxed out their credit cards to fulfill the orders. Without investors backing them, they nearly went broke. MassDrop has recovered to “above-ramen status, but not that much higher,” Mr. El-Hage said.
1) Call them and get to know them
2) Let them know what you're selling up front
3) Verify all your info -- connect a bank account to it, connect a credit card to it
4) before a launch, marketing blitz, or push, call and let them know.
Why? They're not a bank, but they're like a bank. They have to manage risk. Keep them in the loop and your account has a much, much better chance of not being locked down.
I'm not saying Paypal (or any payment service) by any means is perfect or ideal. I just know my interaction with Paypal increased after I could access them by phone.
There is a certain peace in saying "I told you my entire business model before I started and you cleared it as a good fit with Paypal" and documenting it politely.
You'd be shocked how much a heads up of "I'm about to launch or might have a crush of traffic from x" does for their risk management department.
It doesn't mean we should notify them of every business decision through them, but it's kind of like building credit, in the beginning it will take a bit more effort on your part to go out of your way to do the right thing.
Otherwise, we're just a random unverified account with zero history with them. If they get to know you, like anything, things get easier. Scammers wouldn't want Paypal to get to know them, right? :)
Problem is, there are not many if you live outside the US :( Can anyone recommend any international options?
"Hackers — the Mark Zuckerberg variety, not the identity thieves — have long crammed into odd or tiny spaces and worked together to solve problems. In the 1960s, researchers at the Stanford Artificial Intelligence Laboratory slept in the attic and, while waiting for their turn on the shared mainframe computer, sweated in the basement sauna."
$100/night, divided by 4, is $25/night per person in a decent hotel with a negotiated long term rate. Of course, you don't get the intangibles of being in a "hacker house" 24/7 and live out the dream.
not sure how welcoming these houses are to those without the right formal educational credentials
"The captains, all women, screen for personalities and occupations, rejecting applicants who are not techies or simply have a poor attitude. Sasha Willins, a 26-year-old graphic designer who is captain of the San Francisco apartment, has a gentle way of saying no. “It’s not so much rejecting as it is asking so many questions until they withdraw their application,” she said."
but it seems like being in the right 'hacker house', could replicate the advantages of getting to interact with Harvard students for a modest housing upcharge
seems slightly more cost effective than cutting Harvard a 50K check
I know this is written as good spirited humour, or at least I hope so. But measuring success against zuckerberg's assets is an unhealthy preoocupation.
It's very typical of the "Get rich and retire by 30" crowd, for whom running a business is the byproduct of making money
I've been looking in Menlo Park (North Fair Oaks), and assuming buying a 2/1 with 1/1 detached studio could get $50/night or so for the 1/1, if set up properly. But NFO doesn't have great transit.
I tried living in such a community, but it was in the co-housing tradition and required collective participation in chores. Ummm, no thanks.
But the idea of a bunch of people with shared interests and at similar life stages living in the same place - it's just awesome. So much can get done when people with similar goals and diverse talents just "rub shoulders" on a daily business.
Kismet is the source of much human greatness and a community based on shared interest of passionate, talented people is like a little kismet factory.
I bet some clever people could create a social app that would facilitate the creation and maintenance of such mini-communities.
A hacker hostel for Bitcoin startups. 41 rooms. Discount, of course, if paying rent using bitcoins.
"Bitcoin's Hogwart's"
I get & agree with some of the arguments in favour of surrounding yourself with other innovators. In the same way that the Pixar building is designed to foster these interactions.
But if you surround yourself with hackers all the time, there is the risk of losing track of the problems outside your circle. You need to talk to your customers. In the same way that people who work at Pixar go home to their kids and discover what their customers want.
We really do care about creating an atmosphere which facilitates growth and innovation best, and we've put a lot of thought into the community we're helping to build.
People who try to be pushy via Airbnb messages, or are interested in only price (and not the hacker community) are generally not accepted. (Funny how it's MBAs and nontechnical people who see the least value in being part of a hacker community.) Also, people who aren't conscientious while they're with us have a lower probability of being accepted back, but fortunately, those are few and far between.
The second screening is e-mail contact. If e-mail contact seems friendly and they have an interesting story to tell, about work, and projects and interests, then they are in. Extra points for bakers and chefs.
Occasionally we'll have an egotistic and self entitled guest, but everyone is mostly awesome. We have never had to evict anyone based on bad behavior.
If there isn't one, somebody should make it! Would be cool to live in a house with 3,4,5 others all working on startups - but how to find them if you don't all work in the same place?
Bunk beds sounds like a little much for me personally but it would be cool to rent my own room in a house filled with the kind of people coming through your place.
I meant something more permanent, not a nightly rental.