Jan 2, 2019, 12:32 AM ETInterview, Podcast

a16z Podcast | Using Social Tools to Build Homes for Those Most in Need

Entity Name: New Story (operates as "New Story Charity" to clarify nonprofit status to the public).
Core Mission: To build permanent, safe concrete homes for families displaced by natural disasters, replacing temporary tent shelters to solve immediate safety hazards.
Founders: Brett Hagler (inspired by post-2010 Haiti earthquake conditions) and Alexandria Lafsey.
Operational Philosophy: Functions as a nonprofit startup with the mindset, efficiency, and scaling mechanisms of a for-profit technology company.
Strategic Goal: To create a "new story" for displaced families, using housing as a foundational platform to unlock three pillars: education, sustained health, and income/entrepreneurial opportunities.

Context: Following the 2010 Haiti earthquake, temporary tarp tents were intended to last 4 months but remained in use for 5.5+ years.
Safety Risks: Tent slums lack protection against child abduction, sex trafficking, and severe sanitation-related diseases.
Health Hazards: Extreme internal temperatures (up to 98°F) with poor ventilation have caused heat-related vision loss; rain turns floors to mud, creating life-threatening conditions for infants.
Socioeconomic Impact: Housing instability correlates directly with poor school attendance, lower academic achievement, mental health degradation, and reduced parental ability to retain employment.
Comparative Failure: Cites the Red Cross as an example of traditional charity inefficiency, noting they raised $500 million for Haiti after the 2010 quake but had only built six homes after five years due to opaque fund allocation.

Home Cost: $6,000 per unit (100% of direct public donations fund construction).
Construction Timeline: Approximately 2.5 months from funding to completion.
Structural Standards: 400-square-foot concrete block homes reinforced with steel rebar, built to Miami-Dade County and Broward County hurricane standards.
Land Rights: Families retain ownership of the land plot to prevent future displacement by government or private entity seizure.
Community Infrastructure:
- Water: Served by a community-run water cooperative.
- Energy: Powered by solar energy via a Clinton Foundation partnership.
- Location Example: The current community is named "Lavek."
Current Progress (as of interview): Funded 131 homes during the Y Combinator batch; 38 homes completed; 25 currently under construction; remaining homes slated for completion by year-end.

Revenue Structure:
- Two-Bank Account System: Separates funds for public home construction (untouchable) and operations (funded via private donors or opt-in contributions).
- Operational Ratio: Targets a 1:6 leverage ratio, where $1 in operational funding yields $6 in field impact.
- Donor Contribution: Over 60% of donors opt-in to fund operational costs.
Transparency Mechanism:
- Donors meet and fund a specific family via the platform.
- Donors receive a personalized video of the family moving into the completed home.
Growth Strategy:
- Viral Campaigns: Utilizes "birthday campaigns" where users ask for donations instead of gifts; average campaign acquires 13 new donors.
- Referral Virality: 20% of new donors acquired via campaigns go on to start their own fundraising campaigns.
- Contrast to Traditional Charity: Moves away from "inside sales" and galas toward digital ambassadorship and product-led growth.
Scalability Challenges: The team is adapting manual processes (filming/editing/send of donor videos) that do not scale, leveraging widespread smartphone adoption to automate the documentation workflow.

Execution Model: Relies on trusted local nonprofit partners rather than building in-house construction capacity to manage government relations and land rights.
Partner Criteria: Partners must share New Story's values, possess local government connections, have a track record of quality infrastructure, and maintain the technological capacity for communication.
Expansion Timeline: Plans to announce a second country location by the end of the current year.
Target Markets: Considering disaster-struck regions (e.g., Nepal) and areas with chronic displacement due to social issues (e.g., El Salvador, involving drug trafficking).
5-Year Vision: Establish dozens of self-sustaining New Story communities globally, featuring integrated schools, health clinics, and sanitation infrastructure alongside housing.