Prefabricated housing start-up company "Cover" completes US$60 million in Series B financing, and the building technology is benchmarked against Tesla

According to foreign media TechCrunch, the prefabricated housing company "Cover" recently announced the completion of a US$60 million Series B financing. Gigafund, a venture capital company founded by former Founders Fund investors, led the investment, followed by Valor Equity Partners, Founders Fund, General Catalyst, Lennar, Fifty Years and others.

"Cover" was established in 2017 and is headquartered in Los Angeles, USA. The company's official website shows that the mission of "Cover" is to build "beautiful, high-performance, sustainable and affordable" housing for everyone through careful design and perfect construction.

The founder and CEO of the company, Alexis Xavier Rivas, is from Toronto. He studied architecture at the university and worked briefly in a number of construction companies when he founded "Cover". Rivas compares the "Cover" housing manufacturing process to a car manufacturer, and said that the company has attracted engineers from SpaceX and Tesla.

This similarity seems to be found in this round of investors. The two founders of Gigafund had made big bets on SpaceX, and Valor Equity Partners and Founders Fund were also early investors in SpaceX and Tesla.

In fact, the concept of "building a house like a car" is no stranger to the United States and the world. The increasingly tense energy and environmental situation requires the transformation of the development model of the construction industry. Factory prefabrication and assembly industrial construction of building components are the development trend of the construction industry. According to the Tianfeng Securities Research Report, prefabricated housing in the United States accounts for 55% of the South, 19% of the West, 18% of the Midwest, and 9% of the Northeast. In the coastal areas, peninsulas and islands of the country, the proportion is as high as 75%, and the southern coastal areas account for more than 80%. A report pointed out that the global prefabricated housing market will reach US$42.8 billion in 2020, and the compound growth rate in five years is expected to be 2.9%.

The development prospect of "Cover" lies in rapid assembly and provision of customized services. According to Rivas, "Cover" produces complete walls, floors, and roof panels in the factory, transported by standard trucks, and assembled on site without the use of cranes. After the foundation is completed, "Cover" can even complete the construction and installation of the building within 30 days.

In terms of building materials, light steel is used for the building frame, and aluminum is used for the ceiling. The wallboard is made of rubber composite material because "gypsum board wall is not designed for production and transportation-it is too brittle". Other materials include solid wood or wood composite floors and exterior walls, as well as hard kitchen countertops and non-porous bathroom floors. These materials are more hygienic. Under the shadow of the new crown epidemic, hygiene issues are becoming more and more important for homeowners.

At the same time, the company has invested a lot of new ideas in architectural design. For example, pipes and wires are installed in the ceiling. Therefore, if the owner wants to reinstall the wires and pipes, he only needs to open the ceiling instead of patching and repainting the wall as in the traditional way. This design also reduces the manpower required and is catering to the current shortage of construction craftsmen in the United States.

According to Rivas, consumers can cooperate with the company for house design. At present, this design is limited to single-storey houses of 1200 square feet (about 112 square meters) and below. Factors taken into consideration include where the windows are installed to reduce energy waste. In this regard, Rivas also pointed out that the windows produced by the company have passed LEED certification, and because its houses are airtight, it has greatly improved energy efficiency.

Rivas also said that in the near future, users will be able to easily expand the houses they have purchased through the Cover app. "You can enter the app, click on the room you want to add, set a good time, pay online, and complete the renovation within two to three days."

In terms of price, the price of this prefabricated house is $200,000 for a 400-square-foot studio (about 37 square meters). A one-bedroom unit of 600 square feet (approximately 56 square meters) is USD 250,000; a three-bedroom house of 1,200 square feet (approximately 112 square meters) is USD 500,000. These costs include permit fees, municipal fees, foundation fees and the cost of the house itself.

Due to the shortage of housing and construction industries in the United States, there is no shortage of demand for houses built by "Cover". In fact, Rivas said that now many people in China are interested in Cover, so that "an employee spends one-third of his time in sales." Most of the company’s customers’ home purchase orders are used for parents, college graduate children, etc. to move in; or to build a family office outside their house; or to increase rental income.

It is reported that the current total financing of "Cover" has reached 75 million US dollars. The company's future vision is to build larger, multi-storey houses, and houses that can accommodate multiple families. Rivas said that the expansion of the house needs to produce more wall panels, for this reason the company will move from the current 25,000 square feet (approximately 2,300 square meters) warehouse to a 100,000 square foot (approximately 9,300 square meters) factory.

As a prefabricated construction company favored by capital, whether "Cover" can grow into the next "Tesla" in the field of technology construction, we will wait and see.