A Former SpaceX Engineer Wants Apartments Built Like iPhones
His startup builds apartment units in factories, stacks them by crane, and wires in sound and video like a phone.
Harvard Business School Alumni · Elevator Pitch: Block by BlockWong, a former SpaceX engineer and the founder and chief executive of Cloud Apartments, was pitching his startup to investors with an unusually blunt verdict on his new industry.
“The rental apartment is a very disappointing product that the world has become accustomed to,” he said.
Wong says he started the company in early 2021. “I wanted to see what would happen if Tesla and SpaceX engineers invented a product line of apartments that could be built by leaders within the construction industry,” he said.
His answer is Cloud S, the company’s flagship line of rental apartments. The units are built in factories and then stacked by crane into apartment buildings. Because the same design is built over and over indoors, the work avoids weather delays and repeat fixes, which holds down labor time and waste. The company says the method can produce contemporary apartments for much less money.
Wong wants Cloud Apartments to become, in his phrase, the Apple of housing. By that he means designing the unit and its technology together from the start, the way a phone and its software are designed together. In practice, Wong says, that includes sound systems and projectors built into the rooms, plus modern interior layouts.
The company is betting on a large market: the United States is short about 5 million apartments.
Cloud Apartments has raised more than $3 million, led by investor Tim Connors of PivotNorth Capital. It planned to start work on its first San Jose building in late 2023.
Questions people ask
What does stacking apartments by crane actually involve?
Each unit, or a large section of one, is finished in a factory with walls, floors, wiring, and plumbing already in place. Trucks carry the modules to the site, where a large crane lifts them onto the foundation and into position. Workers then join the modules together and connect them to water and power.
If apartments cost less to build, will they cost less to rent?
Not necessarily. Factory methods can lower construction costs, but rent also reflects land, financing, local rules, and what the market will bear. A cheaper building can still command high rent if demand is strong. The hoped for benefit is that lower costs make it possible to build more.
Is factory-built housing a new idea?
No. Builders have experimented with factory-built and prefabricated homes for more than a century, including mail-order houses and postwar prefab homes. The approach has often struggled with transport costs, factory overhead, and local building rules. Cloud is betting that a tighter product design can overcome those past limits.