The way we live is changing. Our societal wants, needs and expectations have shifted more in the past ten years than they did in preceding fifty.
Vann Vogstad, founder of COHO, believes that the changes we have witnessed in priorities and lifestyle are leading directly to a dramatic shift towards coliving and that anybody who owns or manages a property portfolio needs to act quickly to avoid being left behind. Because allowing the current traditional, and often hostile, relationship model between tenant and landlord to exist will end badly for both parties.
100% success rate
Among PropTech Founders, Vann Vogstad is somewhat of an outlier. Whereas the majority are learning the ropes with their first entrepreneurial effort, he enters the industry having already founded and successfully exited two businesses.
“I like trying to change things that people haven’t realised need changing,” he says. ”So it’s no surprise I could only hack a couple of years working for somebody else. I want my work to have an impact. If it doesn’t, I lose interest.”
Vann’s first business was created when a close friend fell in love with a girl and moved with her to Bangkok.
“It was more an experiment than a business,” Vann says. “I wanted to see if I could build a company that actually launched a product into the market. This is the biggest hurdle all techies face because they get so caught up in product and design that they forget to build a business around it.”
In Bangkok, Vann’s friend struggled to find out what was going on in and around the city – gigs, shows, sporting fixtures, and so on. There was no resource for that kind of information, so, in 2013, he and Vann built one
As Vann got hooked on the idea of making it a success, the listings site morphed from a hobby into a true business. Before long, they won the contract to sell tickets for the Thai leg of Jimmy Carr’s standup tour.
“Working from home, in my bedroom,” Vann says, “it was just me cutting my teeth on business, if I’m honest.”
Despite Vann’s near-horizontal ease about the whole thing, the site grew to become one of Thailand’s biggest ticket-selling sites and soon attracted the attention of suitors, finally acquired, in 2018, by a Top-100 FinTech company.
While working on the listings site, Vann was also working on Tipstrr, a second business venture, this time focused on the world of sports betting.
“When I exited the events listing business,” he says, “I found myself with two ideas and a decision to make.
“One idea was Tipstrr, the other was COHO. But at the time, I just didn’t yet have the business skills required to make COHO a success. So I went with Tipstrr.”
Tipstrr was a sports betting marketplace where customers paid a subscription fee to receive precise advice from gambling experts on what bets to place, not unlike a stockbroker advising their investor clients. There is a big market for betting experts, each of whom has their own loyal following.
“These professional gamblers get banned from everything,” Vann says, “so selling their knowledge creates a good secondary income for them. It’s a market which existed before Tipstrr, but it was a Wild West industry, full of crooks and lacking standards. We cleaned it up, and gave the big gambling firms a little kick at the same time, which I enjoyed.“
Tipstrr was acquired in 2019 and, for the second time in two attempts, Vann exited..
“100% success rate; not bad,” and he smiles, almost embarrassed.
Successful exits are not commonplace in the world of startups. It’s a cliche to mention how many fail in their first year, so, what’s Vann’s secret?
“People who come up with good tech don’t necessarily run good businesses,” he says. “I think I manage to blend the two quite nicely. I think it’s also important to focus on solving genuine problems, and solving them entirely rather than partially. And then, of course, there’s a healthy dose of luck.”
After the sale of Tipstrr, Vann was ready to take on the challenge of COHO, believing he now had the skills and the financial capital to drive change in the property industry.
COHO & the Coliving revolution
For tenants, COHO is a place to find the perfect place to live. If you ask Vann, the perfect place has less to do with location or price, and more to do with the people you live with.
“I don’t think, in all honesty, many people want to live on their own,” he says. “There are certainly those who do, but the majority don’t. They end up living alone because our society doesn’t really provide an alternative option.”
Vann says that we’re all used to the idea of coliving at university but that, afterwards, the concept is seen as nothing but a budget-conscious, short-term alternative.
“In those years between leaving uni and settling down with a family; and then again those years in later life – if people could choose between living alone and living with people they like, the vast majority would choose the latter.”
This is certainly true for Vann himself. He chose to spend his university years living at home with mum and dad rather than living with friends or in halls. Upon leaving uni and entering professional life, he couldn’t help but think he’d missed out on something important.
“I didn’t feel ready for it at 18,” he says, “but by the age of 23, I did, and because I’d missed out on the experience before, I decided I wanted to find a similar lifestyle now.
Vann didn’t consider his desire to be a particularly unusual one, but when he started searching the internet for a house sharing website, no such thing appeared to exist.
“I ended up getting lucky and landed with a landlord in Birmingham who was, I appreciate now, incredibly forward-thinking. He encouraged you to choose your housemates as much as you choose your house, and he encouraged the tenants from all his houses to socialise. It was absolutely perfect for me and I had a incredible time.”
Then, Vann tried to persuade one of his single friends to move into another of his landlord’s houses, but the friend said, no way, I don’t wanna live with people I don’t know, and Vann said, but you will know them because the landlord gets you to meet them before making a decision.
He realised then and there that there was a disconnect between what many people wanted and what most of the market was offering.
“People tend to imagine that a houseshare is full of strangers; you’re always going to end up living with that one guy who never takes off his long, black coat, but also never wears trousers and who sits on the sofa all day eating cereal.
“It dawned on me that even those people who don’t want to live on their own often end up doing so because they don’t think the alternative, an HMO, is a desirable possibility.”
A business opportunity started to rattle around Vann’s head as he considered how one might go about enabling people to embrace coliving by ensuring that they only end up living with people they like and enjoy hanging out with.
“From the landlord’s side, too, I saw massive potential. My landlord at the time, one of very few who were pushing lifestyle above bricks and mortar shelter, told me that people couldn’t believe that he managed a portfolio so large all on his own while still maintaining such low tenant turnover rates.
“And there it was, oven-ready, as Boris would say, a genuine marketplace problem. People want to live in these places but have no good way of finding them, and landlords want to maximise their revenue without the burden of managing a large portfolio of labour-intensive HMOs.
“When Tipstrr was acquired, in 2019, I finally felt I was ready to address this problem.”
The COHO Experience
A tenant looking for a colving experience signs up to COHO and, in doing so, creates a brief profile outlining their age range, interests, profession, and so on, as much or as little info as they wish. This enables the platform to match them with properties whose existing tenants are likely to be compatible, where shared experience and mutual interests might pave the way to friendship.
“If you’re someone who likes a quiet life,” Vann says, “you don’t want to live in a party house. And vice versa.
“I’ve seen some of the profiles that people create and I think, I’d quite like to move in myself. But I don’t think they’d appreciate my four young kids moving in, too.”
For people who own or manage properties, COHO is a property management system, but one very different from those which have long existed.
“The old management platforms are just databases, COHO is an assistant. It knows all of the actions that a landlord or manager needs to take and ticks them off when they’re completed.
“This is one of the things that makes COHO different. Instead of warning you when an action needs doing, it can simply notify you when it has been done.
“When the gas safety certificate, for example, is due for renewal,” Vann says, “the system does not even need to tell the landlord or manager. Instead it executes the required action and then tells the manager it has been completed.”
This is possible because there are tenants in the house. When the certificate is due, the system will connect with the required supplier and the supplier will then connect with the tenants and say, ‘we need to arrange a visit within the next three days’. The landlord doesn’t need to be involved.
The same goes for all manner of processes, from maintenance issues to rent collection – no need to keep checking to see if the rent has been paid because the system has told you it’s been paid and, if it’s not, the system chases the payment and offers advice if people are struggling to pay.
In such circumstances, COHO is nice about it, but makes it clear that the rent must be paid. If still no money arrives, the system can handle the unpleasant work of handing the debt to a collection agency.
“The end-game,” Vann says, “is a system which enables HMOs to be a passive investment. At the moment, unless you’re paying for someone to manage it, this is impossible, but it needn’t be.
“If you think about the lifecycle of an asset, there are almost no moments which require the landlord’s engagement. Even when a tenant hands in their notice, the system can automatically handle all of the end-of-tenancy processes (deposit, inventory, etc) and automatically relist the vacant room. Viewing appointments then go through to the remaining tenants (it is, after all, they who should have the final say in housemate) and when a good match is found, the process starts all over again with the automated issuing and exchanging of contracts.”
Vann believes that landlord/manager engagement need only be a last resort. For example, if the tenants are taking weeks and weeks to agree on a new housemate, the landlord does reserve the right to take back control of the process.
Too often, investors are forced to become landlords or pay large sums to a management company. Vann wants to enable them to remain passive investors, but he is also aware that flexibility is essential.
“We let landlords and managers pick and choose which processes they want us to automate and which they don’t. I appreciate that this is all about trust. They can come to us for the management platform and the tenant-facing platform, a total cost of £1/unit/month, and, hopefully, learn to trust us over time and gradually ask us to automate more and more of their processes.”
If the landlords can find this trust within themselves, the financial rewards are equal to the practical ones. A typical management company will charge 15% of rent to manage a property. COHO is here to remove that cost without increasing the level of burden.
If landlords can sell lifestyle, there is sudden potential for scale
“I have no interest in improving what’s already on the market”, Vann says. “Those other HMO room-finders basically function like dating apps. I am completely changing the offering to match exactly what I wanted when I was twenty-three, and to enable more landlords and managers to operate like my landlord did in Birmingham. The current solutions come nowhere close to enabling either of these things.”
This might sound a little self-centred of Vann, placing his own singular experience at the centre of COHO, but perhaps he has realised something important, that his own experience is indeed a shared experience, and that the secret to his former landlord’s success can be replicated en mass if the right tools exist. In philosophy and anthropology, they call this a microcosm, but you could just as easily call it a masterclass in observation.
“Coliving should be less about simply sharing a house,” Vann says, “and more about living together as friends, as a community.
“This is vital for the market because realising you can split a house into rooms and make more money is great, a boon for investors, but recognising that you can demand higher rent and enjoy longer tenancies, simply by ensuring that tenants like each other’s company, that’s the really powerful part of what we’re doing.
“That’s when an HMO becomes coliving, when the offer of shelter becomes one of lifestyle.”
Vann says lifestyle is everything. Apple isn’t selling the tech inside their iPhone, they’re selling what you want to feel by owning one, they’re selling a lifestyle, not a telephone, and the public response is there for all to see – the firm currently controls 20% of the global smartphone market.
“This process of turning HMOs in coliving spaces also enables landlords to scale their investment portfolio. Traditional HMOs are very difficult to scale because of the legwork they demand.
“You’ll notice how a lot of people who get big in HMOs suddenly start becoming personalities. They’re selling courses, giving lectures, and hosting online workshops because they don’t want to have to deal with further scaling their HMO portfolio because that would essentially require them to run a large agency.”
COHO, Vann says, counteracts this, making it possible for HMO investors to scale their portfolio without having to become pro-active landlords and without having to pay 15% to a management company. In the UK market, this is an industry first.
The industry needs to care about this
“I am playing a role in changing the standards of coliving,” Vann says. “HMOs have been relegated, in the eyes of anyone over the age of 21, to being the dodgy, cheap alternative. Soon it will become a default for many. And for those who already choose HMOs, in London, for example, many do, the standards are going to rise. It’s long overdue.
“I want COHO to be central to this change.”
Vann believes, if less people lived alone, the world would be a nicer place for everyone. When one lives alone, he suggests, they become disconnected from their community. But when you live with people, you are a community, and this extends into the wider world.
“The industry needs to care about this because this is where the world is going. Young people cannot afford homes, that’s not going to change. Inequality isn’t going to change. Money is still making money.
“As a private landlord, just because you’re not thinking about coliving as the new standard, rest assured there are others who are. Because of this, they’re striding ahead.
“At COHO, we’re saying that HMO properties should be replacing your single lets to become the central focus of your portfolio.”
Management companies, too, need to care. The days of the hostile tenant-manger relationship are withering before our eyes. People will not accept it anymore. We expect higher standards and more respect. We care about lifestyle and we’re willing to spend money in pursuit of it.
By easing the administration burden, property managers can focus on areas property investors perhaps do not have the skills, the customer service, or perhaps even community management.
“And if none of that is persuasive enough,” Vann says, “just consider the joy of convenience which comes with long-term tenancies because the people in your houses really like each other.”
Playing the odds
Coliving, in both its physical and spiritual form, is going to boom. Of this, there is little doubt. The state of the world, for good and for bad, is proof of this: as the likelihood of home-ownership is decreasing for many, the expectations for quality and lifestyle continues to rise.
Despite this, it is still a sector which PropTech has only gently brushed. Two key reasons for this are cost and difficulty. Vann can attest to this. It’s taken him 18 months to reach this moment of market launch, and it’s cost more than you would pay for your Granny.
This is the price you pay to be a market leader. And despite the heroic rise of the ‘multifamily’ sector in America, a nation whose culture and economic strategy we have long been inspired by, many are yet to realise where the path leads. From young professionals through to retirees, and even families in between, coliving will become the new normal, and the providers who offer the most attractive lifestyle will be the ones who reap the rewards.
As for COHO, will it become the sector’s synonymous brand? Will COHO be common parlance for ‘coliving’? Who knows. But Vann Vogstad is a man who knows business, and knows that a good idea demands good execution. He’s proven it twice already, so I wouldn’t bet against him.