Travis Kalanick starting a RE Company?
Looks like Kalanick is making headlines again, but too the surprise of many, for real estate:
"CSS is a real-estate company looking to buy "distressed real estate particularly in the areas of parking, retail and industrial," as Kalanick describes it.
He says $10 trillion worth of this kind of real estate is available and ripe for redevelopment. CSS plans to "repurpose" such sites "for the digital era," he wrote. Kalanick offers the example of two CSS services to explain what he means: CloudKitchens, which provides services, including kitchens, for food-delivery startups; and CloudRetail, which is apparently doing similar things to support online retailers."
Curios to hear everyones thoughts on this
Parking seems like a cool play to me. They're priced very cheaply because everyone thinks self driving cars will make them obsolete, however still produce cash flow and can be repurposed if/when automated driving becomes mainstream.
If he doesn't set up a good team that knows what they're doing he could easily get his fingers burnt. Although he has a ton of no-strings-attached equity to deploy with the safety that creates, I would expect him to approach the project with a vast amount of hubris. And everyone thinks RE is an easy game...
RE is pretty simple compared to most investments.
Depends on how you're doing the investing. Buying a stock is easy - once you've done the research your done. For RE, once your diligence is done the actual work begins.
This is why plenty of investors get burned. "Buying below market value" isn't a strategy in real estate. Most everything needs active management to be successful. CunningFox makes a good point in that people who had success in a certain area often fail miserably in others, because they don't have the humility to know what they don't know. The same as the constant refrain in startups, that the folks who have the hustle and swagger and tech know how to create a company often run it into the ground, because they aren't good managers.
And assuming is always dangerous... but Mr Kalanick has had success in creating a bunch of products that all did mostly the same thing (P2P [insert here]), and his record as a manager is about as bad as it gets. One-trick pony who can't manage others? That doesn't sound like a recipe for success.
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A buddy of mine is working there. He's an Ivy League alum who says he's surrounded by USC frat-bros. Very macho personalities with crazy work hours anywhere from 60-90 hours, and a company culture that's more closely aligned with a startup than a real estate company. Their play in the industrial sector has a ton of competition against the institutional RE space that owns most of the industrial properties in and around LA with the company running on Travis' dime.
Interesting to see what develops in the coming years, but let's just say I don't feel confident in the business strategy or their execution.
The "FoodTech" space is interesting..cloudkitchen or maybe its been renamed ...TK is continuing the on demand thing. I know some friends that are actually approaching them to talk about leasing space for a kitchen. Its not just RE space though I heard they are or have developed all the software and infrastructure that goes along with it. So you can lease the space and get the infrastructure too. The physical space is also thought to be wanted by many regular restaurants in order to remove the door dasher effect coming to the main restaurant. They have a separate kitchen where all the on demand food comes from. I don't see why there can't be tons of these new restaurants that are on demand only eventually.
Bump - anyone have any updated info on this company? Not a whole lot of info out there on City Storage Systems/Cloud Kitchens.
Some good color here: https://www.bisnow.com/los-angeles/news/retail/former-uber-co-founders-…
...struggling to get units open from the sound of it.
There's a theory out there that Kalanick is trying to pull a Steve Jobs:
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