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Startups Take On More Risk to Popularize ‘Co-Living’

Venture capitalists have been slow to warm to startups wanting to rent out shared living spaces like college dorms. Now, new coliving companies have emerged with a different approach to the business—one they say promises a higher return but carries much more risk.

The new approach, pursued by startups like Starcity and Treehouse, involves taking on the development and construction costs for buildings to be rented out. It’s a marked shift from earlier coliving firms like Common, WeWork’s WeLive division and Ollie, which primarily focus just on managing buildings developed and owned by others.

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*This article has been updated to clarify Treehouse's list of investors.

Cory Weinberg and Carl Muhlstein commented on this article.
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“You’re doing parallel fundraising paths. If you just do software business, you finish fundraising and get back to work. I am constantly fundraising. It’s a different appetite for risk.”