Revolutionizing Housing with Deployable Micro-Factories with Aleksandr Gampel

Welcome to the Construction Disruption Podcast, where we

uncover the future of design, building, and remodeling.

I'm Todd Miller of Isaiah Industries, manufacturer

of specialty metal roofing and other building materials.

Today, my co host is Ryan Bell.

Ryan, welcome to this episode.

How are you doing?

Hey, Todd.

I'm doing great.

How are you?

I'm doing well also.

Yeah, lots of exciting things and we're in the midst of an exciting

season in the construction industry.

And as always, we have another great guest here on the show.

Also, as typically always, we are doing challenge words.

So for the audience, that means that each of us on the show have

been given a special word by one of the others, or maybe a phrase

to work into the conversation.

Somehow you can Be listening for strange things we may say.

And at the end, we will, uh, announce whether we were successful in

using our challenge words or not.

So Ryan, you good to go?

Yes.

Let's get started.

So today, uh, we're taking a look at some folks who have found

and created a very unique solution to our nation's housing shortage and

really the world's housing shortage.

And what's more, uh, what they have developed is something that everyone in

our audience really could be a part of.

Uh, we are talking today with Alex Gampel, co founder of Quby Technologies.

Alex, welcome to Construction Disruption.

Yeah, thanks for having me, guys.

I think these, these conversations, this dialogue, it's important

to progress our industry.

So I appreciate you guys having, you know, smart folks and interesting

people to, Make everyone in the industry aware of what's to come.

Well, I'll tell you the thing I love most about the show is I

always learn something and so i'm looking forward to learning from You today.

So, um before we kind of dig into cuby technologies and what you've developed

there I'm, just kind of curious Could you give us a little bit of a background on

how you view both the shortage of housing?

And the shortage of construction workers in the united states and you

know What the impact of those shortages is having that Caused you to, uh,

go out and develop QB technologies.

Yeah, for me, it's super personal.

I come from a real estate family, so I've touched real estate my entire career.

Most of my life, um, you know, starting with Legos and always

looking at the buildings as a kid.

Um, so I, I love the built environment.

I love the idea that 4 walls shape, you know, the.

Essentially our lives, the backdrop to our lives, it's where we would live.

It's where we work.

It's where we play.

Generally, construction, uh, is the most vital sector to any economy.

It's generally the biggest, uh, for most countries, employs the most people.

So it's a vital sector.

Um, housing has been in the headlines nonstop for the last several years.

Uh, even, you know, the debate was a couple nights ago, uh,

that was very much talked about.

Housing is an important issue for first world countries.

You can't be a superpower if a lot of folks can't afford

to rent or or acquire a home.

And that's partly why we have a household formation decline and

why folks are delaying having kids.

So, like, it stems into really, really big problems that have

the potential to compound.

Why are we building less homes?

Um, folks have different pieces around this.

We think it's, uh, yes, bureaucratic and the pre development process

required to go build a home takes a long time is expensive.

It's a hindrance to a developer's job, et cetera.

But we think it's really tied to the idea that young people don't

want to be construction workers.

It's evidence.

You show up on a construction site.

Average age is 40 to 50 years old.

That's kind of wild considering how intense and dangerous and.

Physically labor intensive industry is, um, so we think it's really

due to a shortage of the fact that, like I said, young people don't

want to be construction workers.

So we're trying to do something about it.

We want to figure out how we can go build more homes with fewer hands.

Essentially.

That's the premise of what we built for me.

It's kind of a random and non linear path as to how I got here, but it really

had to do with the idea that I was.

Able to go develop a lot, uh, with a lot of partners and we were running into

a constraint, which was not capital.

It was not deal flow.

It was hiring GCs and subcontractors.

That's when I first was exposed to this labor issue.

Very interesting.

And you know, the other thing I think it's kind of goes along with that

and it's very interesting is that.

You know, recent years where other than the blip caused by COVID, we've had really

relatively very low unemployment rates.

I think that kind of highlighted this shortage of workers, but I think you hit

the root cause nail on the head there in that that this really started when

unemployment was You know, five, six, 7%, we simply saw fewer and fewer people

wanting to enter the skilled trades.

And, uh, it's interesting.

Our guests next week is going to be talking about, uh, a solution to

training and trying to elevate the skilled trades a little bit as well.

Um, but I love what you're doing by recognizing the connection of that labor

shortage with the housing and construction shortage, figuring out how we, how

can we address both at the same time?

So.

My understanding is, you know, what QB technology is, has put together is a

combination of software and hardware, um, that allows you to sell folks, mobile

micro factories for resilient homes.

Is that kind of how you would describe it?

Or is there a different way you would describe it?

You know, over the course of years, we've iterated

how we talk about the business.

And I think, you know, as a one, one liner, it's the most concise

to say that we design, we develop, we deploy mobile micro factories.

That then manufacture and assemble homes for the masses.

I think that's an easy understanding of what we do.

Um, it's not easy on the back end to make it work and to be

able to replicate in the future.

We're hoping to do about, uh, 275 mobile micro factories, but.

The essence of what we've done is we figured out a way how we can apply

Toyota's production system, or I guess more famously known, Henry Ford's assembly

line to construction in a way that historically industrialized construction

has not been able to make work.

We think the way to do that is not a centralized gigafactory.

We think it's about decentralizing manufacturing and putting

up a network of smaller, uh, footprint, lower capex factories.

That then manufacture and also have the capability to vertically integrate and

assemble the kit of parts that those factories are capable of producing,

turning that into a home, requiring less skilled labor, which in turn

reduces cost, which is generally the most expensive variable in that dollar

that it costs someone to build a home.

Well, that makes a lot of sense, I think, especially

the decentralization and sort of regionalization of what you're

doing makes a lot of sense.

So I'm kind of curious, tell us a little bit about the equipment, um,

the hardware, the equipment that is required to run these factories, you

know, how much space does it take?

Um, I'm kind of curious too, what are the raw materials?

Are you building the homes out of conventional raw materials or are there

some new materials being used as well?

Yeah, I'll sound like a broken record across the

different mediums that we talk about our business, but it's really anchored

in three pillars, which I think touch some of what you're asking one.

We talked about it's decentralized manufacturing.

We don't think having a 100 million dollar gigafactory works well in the

space when you have to ship millions of square feet, millions of tons

worth of a product thousands of miles.

Therefore, we believe in having this localized, hyper localized approach, not

even regional, a hyper localized approach, almost like a last mile solution.

So that's one.

Two, we don't believe in changing the end product.

The further you deviate away from what a standard home is, what, say,

a top 20 production home builder is building, Meaning you're innovating

around materials or pre cladding walls with MEP and shipping those

walls or volumetric box, et cetera.

So the further you deviate away from what is recognized today by trades as

a traditional home, the harder it is to have incumbents adopt that system.

And the harder you're running uphill against the regulatory

red tape that exists today.

Folks forget that building a house is a highly regulated space.

There's compliance, there's inspectors that are pretty boring and don't want

to change the way things are done.

So, pillar number two for us is, don't deviate away from norm.

So, we're innovating within the confines of a box, meaning

we want to go deceptively look like traditional construction.

Built on site, very much recognizable home, different

sizes, layouts, finishes, etc.

Pillar number three is around cost, which is, I think the most important thing to

date industrialized construction has been, it's been hard to make hard cost work.

They want, it's about speed and potentially, uh, quality controls, but

it's never about true hard cost reduction because no one's been able to do that yet.

We're trying to, we told ourselves we won't go to

market unless we can solve for.

Being around a hundred dollars a foot in self cost the factory.

Um, so that's important now to dive into your question.

It's hard for your audience.

I think to visualize without physically seeing, you know, imagination is

one thing, but I'll try to describe that our mobile micro factory is

it's about 40 shipping containers that are shoved to the brim.

With our equipment, I call it OEMs, different machines, you know,

basically stations and assembly lines shoved into containers.

Those containers come together, they form a rectangular perimeter.

That's about 30, 000 square feet.

And those containers, they essentially are single level, let's call them

when they form the perimeter.

And we inflate this pneumonic structure on top.

It's like a tennis court, you know, like a bubble structure, it's non pressurized.

But what that allows us to do is we have a constantly repeatable system that's a non

permanent structure, meaning we don't take four to seven years to go build a factory.

We don't need to change it every time.

It is the same blueprint, which matters for the software, which we'll get

into a second, but we quickly deploy these stations out of the containers

into different, uh, assembly lines.

And what happens inside the factory is one of two things.

So it always feeds, whether it's a localized or non localized

supply chain, pretty standardized, none of it is proprietary.

It feeds about 600 line items, so 600 different SQUs worth of materials.

And what happens inside is one of two things.

One will produce things from scratch with those machines.

Meaning we'll make things like windows, like a helical pierce for the

foundation, certain framing elements.

We'll make, um, even pure panels, uh, you know, to sit like

non structural wall elements.

So sandwich panels that are pure and galvanized steel coils.

So like there's things we'll make from scratch as a raw input to finished good

and everything else we take and we prep.

So sheetrock, text pipes, cabinets, toilets, etc.

Doesn't make sense for us to make, but we can take those in as inputs and

prepare them so there's no, let's call it messy thinking work done on site.

But the idea is we basically break up a home in 37 stages, call them pallets.

We palletize those one and two inputs and we send them last mile down the

street where on site we have unskilled labor putting together those kind of

parts with tools that also make their way on site with bathroom showers

lockers that are available on site because we've containerized them as well.

Um, that's essentially the system, but from a home perspective, really standard

home, there's probably 2 things that are irregular when you compare a home to like.

All in our home, we use steel and rivets for structural framing

elements, and we use Sandwich panels for non structural enclosures.

So the walls, that's it.

Everything else is pretty normal.

Very interesting.

So the concept is the factory is operating and those materials then

are immediately going to the job site a mile down the road or whatever, uh,

where they're then being constructed by unskilled labor and into a home.

Is that correct?

That's correct.

And all that is driven by kind of hardware is two things.

It's the kit of parts, which deceptively looks pretty standard,

but the way it comes together is.

Meant to work with unskilled labor.

It's the hardware that builds those kid of parts.

And then it's kind of like, you know, the art, the software, which

is the operating system or like the, all the salad dressing on top.

Okay.

So that's really what the software does is it's everything from in

house like HR payroll to all the way, uh, this catching software to

send the kid of parts to different construction sites in the right manner.

It's the instruction manual behind building.

Uh, systematically the care parts in the right order, et cetera.

So the software matters quite a lot too in this, in this process.

Okay.

Very good.

Very interesting.

So, um, how many homes could a typical factory produce in a day?

What's interesting about us is if anyone follows the chips act

and some of what, you know, Biden has put forth around funding massive factories.

Typical factories for anyone that doesn't understand manufacturing, you

know, you could be 25 million, you could be 50 or you could be 5 billion.

Uh, the beauty of our system is we figured out how to launch factories

for about 10 million bucks, which isn't a crazy amount for a factory that

will do 200 homes worth of output per year, about 430, 000 square feet, um,

from foundation to interior finishes.

Cause that's important.

We touch every aspect of a home that ties to the vertical build.

Which is foundation to finishes effectively.

So 10 million topics to do about 200 homes per year.

So 200 homes per year.

I'm not sure how to ask this question.

You know, that's going to be roughly one every two days or three days or something.

Um, is the erection time on site about the same?

I mean, you, you wouldn't be able to put these together that quick.

Would you?

No.

So, no.

So it's just about output.

So we're worried about like.

30 or about 60 to 90 days today.

The goal is to drive down to about 30 days.

We want our bottlenecks to be bureaucratic, not tied to our physical

capacity or the technical side of KUBI.

We want it to be, you know, an inspector being late.

Yeah.

Waiting on an inspector, all that type of stuff.

Oh, very interesting.

So, so do you have any factories up and running right now at this time?

Yeah.

So listen, we're probably at our 1 percent mark given where we're trying to go.

So we're still relatively early, but relative to being early, we've now

done about 400, 000 engineering hours.

We have a relatively big team that's constantly working

to de risk the technology.

In four years, we were able to design all the systems, test

and build all the machines.

We've put up a manufacturing facility that makes the machines.

We've put up our first mobile micro factory.

It's our first of a kind.

Um, so we've gotten pretty far.

Uh, we're just starting to get to commercialization, meaning our

business is more akin to McDonald's.

We're not interested in being a developer.

We're not interested in stepping on the toes of your audience

who happen to be home builders.

Um, we're McDonald's.

We want to give the system to as many kind of local hands out there as possible.

So, we're just commercializing.

We have our first sites on our first two sets of contracts, one in Las

Vegas, another factory going to Denver.

Um, so those will be like our first two commercial efforts.

Very interesting.

Well, I love what you're doing.

And yeah, I mean, I just want to see you go hog wild with this.

I think it's a very cool concept and, um, neat thing.

So, so, you know, I guess I was thinking in terms of what radius would a factory

cover, but it literally would be there just to create the home development

that's a mile down the road or whatever.

No, not necessarily.

We service 150 mile radius, you pick the right location.

You can be operating for 10 years.

You pick any dot on a map in the US.

There's thousands of homes that can be absorbed.

That's the type of housing crisis we're in.

So it's, it could potentially work with.

A, you know, Howard Hughes type or corporation, like, in theory.

Uh, it could be a master plan development over a couple of phases, or we could just

plop up somewhere in Las Vegas and Las Vegas needs 86, 000 units at the moment.

And we're only 200 of those units most more cost effectively a year So

in theory, you could be operating for 10 years out of the same location.

Sure.

Gotcha So how do you kind of quantify how the numbers stack up?

I mean, what is the impact of the qb factory on the labor shortage?

Yeah, so For your audience that isn't familiar with home

building, to build a home in the U.

S.

today, it probably takes somewhere from 7 to 14 months, depending on

who you are, where you are, etc.

It involves 22 different fragmented, disjointed, and not

always aligned subcontractors.

Uh, and it takes, you know, uh, a lot more people than it takes us today.

And I don't quantify people, I quantify labor hours.

So I think a home today will take like 7, 000 labor hours, whereas

we're trying to build a home in 2, 200, 2, 700 labor hours.

Something like that.

From a dollar perspective, quantifying that.

I think the statistical average of building a home

on the hard costs in the U.

S.

is somewhere around 154 a foot.

That's a 2021 number.

I don't buy that number for a second.

You know, that's maybe skewed by the top 10 home builders.

Anyone we talked to is nowhere close to that number, especially, especially

on the coasts, right, maybe in Texas.

Um, so relative to that number, the way we enter a market is we look

at what an average cost to build is for Bob Smith, the home builder.

And we say, okay, let's come into that market and let's get incentive

enough for you to want a factory to know that the way we build is going

to be cheaper and what's that right.

We think it's like a 20 percent discount to where they are today.

Our margin is between where that number in terms of conversion happens versus

our number, which is about a hundred to a hundred and ten dollars a foot

to build, uh, on the self cost, on the hard cost of kind of labor on site,

labor off site, plus the material costs.

So it's a significant Delta, um, to where it costs to build today.

Very interesting.

So how many factories would you see QB being able to

potentially put out at a year?

You say right now we figure we're maybe 1 percent of what

we, what we eventually could be.

We're in this phase where we have two

really good supportive partners.

They're risking a lot working with us.

Um, And we're, you know, it's really great that we're working with them because

they're going to be their own off taker.

They're going to smoke their own supply.

They're going to put up a factory and they're going to,

uh, consume all of its output.

Um, we're good on our 1st, 2, we need to execute.

We need to test, you know, in in Toyota's production system.

This is called Kaizen constant improvement iteration.

Um, but the goal and the end goal, and we're kind of, we want to end

up as 275 mobile micro factories.

At least half or at least 60 percent of those will be in the U.

S.

Um, the rest and other 1st world countries where labor is an

expensive part of the build process.

Um, we're far from that.

It's going to take 10 to, you know, 10, 7 to maybe 12 years, something like that.

Let's call it 10 years, but we want to just get those 2

dominant and we can start.

We can start batting a lot more.

So let's say I'm an investor out there or maybe a home builder.

And I'm thinking, gosh, this QB stuff sounds pretty cool.

Love to put it in a QB factory.

Can you kind of guide us through what that process would look like

for someone that approached you and said, Hey, help me make this happen.

Yeah, so I think, you know, we constantly get inbound because

they think we're, you know, the 1st ever to go productize the factory, right?

I don't see a lot of for sale factories white label to folks.

That's kind of what we're doing folks.

Reach out to us all the time.

It's a bunch of back and forth conversations building trust.

Learning about their business, they learn about our business, and end of the

day, we've never had a no, it's either, sure, let's take the risk together,

you're early on in your process, I want to be a first mover, or it's, tell us

when your first, or second, or third one is up, and we want to be next in

line, but we've never gotten a no.

The value add is there.

It's just a matter of someone's risk profile.

Um, I love it.

Well, this has been a great conversation.

We really have covered a lot in a pretty short amount of time,

which, uh, I kind of like that.

Um, but, um, we're kind of close to wrapping up what I kind of

call the business end of things.

Is there anything that we haven't covered today that we didn't think

to ask you, uh, that you would like to share with our audience?

No, I think this is thorough.

If anyone has questions, our website is a good way to reach us.

I'm sure there's a lot more technical stuff we can cover, and you don't want

four hours of re ranting, I promise.

Well, I love what you've done, and gosh, you're a young guy, and

amazing that you put this all together.

Now, you've got a business partner also, is that correct?

Yeah, so I think you'd be really, uh, a disservice to Put trust

in your audience and potential or really put trust in me for your audience,

your potential potential customers.

They get far away.

My partner is the brainchild of all that's technical on the side of our business.

He spent 20 years building hardware and scaling that hardware

in a manufacturing type way.

He has a great book about scaling deep tech teams.

Uh, his, you know, his Bible is the Teodos production system.

So this is his bread and butter.

Very neat good stuff.

Well, um before we close out We always invite our guests to do something that we

call our rapid fire questions Uh, these are seven questions kind of from out of

the blue, uh, alex would have no idea.

We're about to ask Um, are you up to the challenge of rapid fire?

Great.

Well, Ryan, you want to alternate asking questions and you go first.

I would love to.

Question number one.

If you could eat only one type of cuisine for the rest of

your life, what would it be?

I live in New York City.

I think for most people that's sushi.

Very interesting.

I don't know if I could eat nothing but sushi.

I love sushi.

I

know you do.

I don't know if I could eat nothing but sushi.

Good stuff, but you got lots of, lots of it out there in the East coast too.

Good stuff.

Question number two, um, what is a product or a service that you have

purchased recently that was a game changer for you, sort of a, where

has this been all my life moment?

It's in theory, purchasable, but I

was an early tester of it.

So I think I'm still writing a bit of a, uh, demo, let's call it that.

But a friend, he's become a friend after I demoed it.

Started a calendar service where basically anytime I want to schedule a meeting of

someone I cc this bot, bot at blockit.

com and it handles all the scheduling on my behalf, interacting as if the opposite

party is interacting with my EA, like a physical human EA, set up a meeting nearby

coffee shop, propose times, coordinate if someone says, Oh, I need to move this.

I don't touch this.

You know, the email chain after that, I probably had countless

of hours saved countless.

I probably could not live without it.

Absolutely.

And say that's bought at block it.

com.

Yeah.

Block it like block it.

com.

Very good.

I'm going to check that out.

Yeah, me too.

All right.

Uh, question number three, what's the best piece of bipartisan

advice you've ever received?

That's funny.

Yeah.

Okay.

So I was just in DC.

Okay.

What I realized is housing is a bipartisan issue.

No one really cares what side of the spectrum you're on.

Everyone realizes that housing is worth the pursuit.

So the advice is talk to everyone, uh, in the public sector about housing.

Makes a lot of sense.

Yeah, but you're right, it is completely bipartisan, um, good stuff.

Uh, next question, um, if you could have dinner with any historical figure,

who would you choose?

Elon Musk is controversial this day.

I don't think he's a historical figure, but, um, he would make the list.

I think, uh, it's inspiring what he's done for kind of, um, progression.

I think we've like, stalled a little bit for the last 50 years, so it's

interesting to see someone that inspires other folks like us to go do really big

things and solve really big problems.

Um, so I think that would be high on my list.

That's a good one.

Absolutely.

That's a popular answer.

We hear here.

It, it is.

Yeah.

It makes a lot of sense.

Yeah.

It just, um, the guy, uh, is challenges us all to think of, Hey,

how, how different could we do this?

If you want a true historical figure, I think

it would be awesome to interview like some of the, or like there are

some, like the great industrialists.

You know, like the Andrew Carnegie's of the world, the Henry Ford's, I

think it would be really interesting to have conversations with those folks.

There's an interesting book out that actually another guest on the

show had recommended once called freedom's forge and it's about Um the industrialists

during world war ii and how they came around supporting the the war effort

But the only reason we we we won the war right is because

all of our industrial capacity was shifted toward We were just able to

produce more weapons Um, and that's, that's the big debate right now.

This is why venture capital is backing the private sector and defense is because

we've stepped so far away and stepped into kind of China producing everything for us.

So we couldn't turn on, uh, this industrial base, even if we wanted

to in a critical time, it's a, it's actually a big national security issue.

Yeah, it's interesting.

That book really drove it home for me.

Um, great, great book.

Well, I'll read it.

I've heard the recommendation.

I'll definitely take a, take a read.

Cool.

Ryan, your

turn.

Okay.

Next question.

What is a bucket list vacation destination for you?

Uh, very fortunate.

I've had an opportunity to travel a lot in my life.

Uh, my wife as well.

Recently, like we traveled a lot.

Um, but I think what's next on the list, because all destinations that you haven't

been to should be dream destinations.

I think next on the list is, uh, is Chile.

Oh, nice.

The Atacama Desert in Chile.

We have a couple of roofs in Chile and some interesting

stories of those getting put on also.

Um, next to last question.

What is one book that has had a major impact on your life?

I think Sapiens is really interesting.

I think like the history of, of, uh, of humans is just generally fascinating.

Cause I think history definitely repeats itself.

Very interesting.

Okay.

Final question here.

At the end of your days, what would you like to be remembered for?

I think Oleg and I have, my partner Oleg

and I have a shared vision.

We want to be the people that have built more homes than

anyone else in our lifetime.

That's kind of single individuals.

That's cool.

Good stuff.

Well, Alex, thank you again.

This has been great and very interesting and I've learned

a lot and I appreciate it.

And I know our audience will enjoy it as well.

So, um, for folks in our audience who would like to learn more or get

in touch with you, learn more about QB technologies, um, give us some

websites and ways they can do that.

Um, Yeah, perfect.

So just our website is great.

The submission link goes, uh, I get cc'd on that.

We're pretty hands on.

So happy to chat with anyone that wants to learn more.

Very good.

And we will put links and things in the show notes as well, uh, for our audience.

So you can get some direct links there.

Well, thank, thank you again, Alex.

This has been great.

Awesome.

Thank you for having me guys.

Appreciate it.

And thank you to our audience.

Oh, I need to remind everyone.

We did all work in our challenge words.

I almost forgot that.

Um, Ryan, your word was?

Bipartisan.

Which you got in there.

You kind of changed one of our questions to work it in.

That's kind of your trick.

That's your specialty.

Alex, your Easiest way to

do it.

Your word, Alex, was?

Salad dressing.

Salad dressing.

You got it in there really well and, uh, I had hog wild.

I'm not real pleased with the way I worked it in, but I got it out there.

I didn't even cheer hog wild.

You did it?

Oh, I had.

I did.

I had a really hard time not laughing when you said it.

What was the conference?

I got to

read.

I got to read.

So I'll have a chance to re listen to

this.

Oh, well, a little bit fun.

Hey, thank you so much to our audience for tuning into this very special

episode of Construction Disruption with Alex Gampell of Quby Technologies.

Check them out.

They're doing great stuff.

Please watch for future episodes of our podcast.

We always have great guests.

Don't forget to leave a review.

Until next time we're together, keep on disrupting and challenging looking for.

Better ways of doing things just like Alex's.

Don't forget to have a positive impact on everyone you encounter,

make them smile and encourage them.

God bless and take care of this is Isaiah industry signing off until the

next episode of construction disruption.

This podcast is produced by Isaiah industries, manufacturer of specialty

metal roofing and other building products.