Seed Home 2 Strategy
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Simple Enterprise: Task Queue to Change the World
Simple program milestones are:
- Revenue model of $25k net revenue per Master Builder per month, based on a 1 month build, with $80k materials cost, and sale price of $130k for a 1000 sf home. This is the data collection right now that we are working on. If Master Builder takes 200 hours to build, with a $25/hr assistant for 200 hrs ($5k), then the Master Builder commands a $225/hour equivalent. There are significant costs associated with equipment, which can be addressed by open source equipment, making high hourly revenue a reality at around the $200/hr point. This comes to $5k equipment costs using off-shelf equipment, but should be 20% of this if open source equipment is used. These are theoretical values that the model is expected to garner, assuming $20k land costs, and $20k utility connection, legal, and impact fees. This omits design, plannind department submission, and engineering costs based on open source design and calculations. See Seed Home 2 Calculations. The requirement on the Master Builder is significant - because if the Master Builder is doing the work themselves, they have to understand dealing with customers, design, construction, organization, and enterprise aspects. This is under a small business operation where the Master Builder does the work by themselves, with minimal assistance. Once full division of labor is counted in this model, then the builder's revenue should drop to 20% of the soloprenuer value, from $45k, to about $9k for the job.
- Pending success of a $25k/month net revenue model, we will have discovered a method to bootstrap fund development. $25k/month can be the case where $50k revenue is obtained with a 2 month total. This depends compkletely on the actual build time data - how effectively we can build, and what product value we obtain in the given time.
Rationale
The Master Builder being a jack of all trades using open source design allows for high revenue efficiencies. This is the model that we are testing: industrial productivity on a small scale. The promise of such a model is increase of revenue from 20% to 80% of the operation - or about 4x. This allows for economic surplus, and thus psychological integration of the participant.