Originally published at https://freshbrewedtech.com on March 1, 2021.
When Carl Dumesle from Haiti and Bria d’Amours from Montreal came to the University of San Diego (USD) for graduate school, they realized there was a serious market gap for international student housing. Their personal struggle to find housing while starting school in a new country inspired them to find a way to shield future international students from the difficulty they experienced in the current system.That inspiration led to the creation of Housing for Undergraduates and Graduate Students (HUGS).
We had the opportunity to talk to Dumesle about his entrepreneurial journey and his passion for finding housing for international and out-of-state undergraduate and graduate students easier.
The Problem: “Only about 10% of international students are granted housing through the university they attend in the U.S.,” Dumesle said. “And this is only for one or two years of undergraduate school. Grad students and the other 90% of international undergrads have to find housing on their own.”
The issue is most international students arrive in the country with no Social Security number, credit score, or co-signer, which makes finding housing incredibly hard.
“Students that predict staying in an Airbnb or hotel for about a week end up staying for months, depleting their bank accounts,” Dumesle said. “When they do find housing, the security deposit is often for two times or three times more than the asking price, due to landlords being able to take advantage of the international student’s predicament. All of this is happening while school is currently in session, putting more on the international student’s plate.”
This is a problem at colleges nationwide. According to Dumesle, the demand is simply bigger than the availability, and the issue is widely unrecognized.
The Solution: Before arriving in the US, international students have to submit documentation to the federal government to receive a Visa. This documentation also provides proof that the student has funds available for at least a year’s worth of expenses.
Dumesle and his team took these same documents and assigned rankings to each category in order to determine how likely this student is to pay rent in the future. This algorithm then creates a number comparable to a credit score, which the team calls a “HUGS Score™.”
The completed website will include the ability for international students to search for housing, connect with landlords, be given their HUGS Score and pay for their housing insurance through the same portal.
Business model: HUGS will be free for students to apply for a HUGS score with a convenience and transaction fee. Landlords will also sign up for free but there will be different tiers of subscription prices depending on the level of service they want to receive.
For example, an individual landlord could lease up to three listings with no monthly fee and higher service fees, while a leasing company might choose to pay a higher monthly fee for unlimited listings and lower service fees.
One of the biggest benefits that HUGS will give international students is the ability to find and pay for housing while they are still in their home country.
“Starting school without knowing where they’re going to live is a huge burden on international students’ backs, one that we hope to eradicate,” Dumesle said.
Funding: The HUGS team won their first funding from the Fowler Business Concept Challenge in November 2019. USD School of Business awarded the duo’s idea as the top prize winner of $15,000 in scholarship money. This win also helped the team further validate their idea and gain networking opportunities.
The HUGS team also won third at the Fowler Global Social Innovation Challenge, which granted them further seed funding and resources.They have since secured HUGS’ first housing partner that will list 20 housing units as a beta test for their platform.
They are preparing to pitch their business in the upcoming V2 Pitch Competition in spring, as one of the last things the team can do on campus at USD before graduating. The team hopes to raise funds in a seed round this summer as well.
“We’re looking to raise an initial $100,000 pre-seed that will be split 50% tech and team, 20% legal and administration, and 30% sales motions, marketing and partnerships. Our next raise will be at the San Diego Angel Conference in December,” Dumesle said.
Next Steps:Dumesle and the HUGS team are looking forward to the upcoming V2 pitch competition, where they will focus on furthering their network and gaining partners for the business. They have already made their first partnership with a landlord, and hope to get the HUGS website up as soon as possible.
The HUGS team has big plans for the upcoming year as well.
“We’re developing our different partnership and affiliate programs with universities, landlords, and students. As part of our partnership with USD, we want to create a Housing Scholarship for students that will be a percentage of the revenue that comes from USD’s referrals,” Dumesle said. “By Fall semester of 2022, we want to be a partner with universities in Los Angeles and San Francisco.”
Mentors: Dumesle credits his mentors with the success of HUGS, including:
“We owe her everything. She’s the one who organizes the biggest pitch competitions at USD and started the Torero Ventures lab. The Torero Ventures lab is really where we began to build our business model into something we could monetize,” said Dumesle.
Dumesle originally interned for Tony Malz, the Former Vice President at FICO and current CEO of Sizigi, and he later became the first advisor to HUGS.
“His business experience and track record has helped me learn a lot. He’s there every step of the way. He’s more than a mentor, he’s a friend,” said Dumesle.
According to Dumsele, the team’s original idea was to build housing speciallically for international students. They soon realized that this idea wasn’t feasible, and they had to step back and rethink their business plan.
“He helped us think in ways that are scalable. At first, we wanted to build housing for international students. He pointed us in the right direction and helped us realize that idea wasn’t as realistic. He was our mentor for the Fowler Concept Business Challenge. Without him, I don’t think we would’ve gone as far as we did,” said Dumesle.
Entrepreneurial Journey: According to Dumsele, the hardest part about his entrepreneurial journey has been finding a balance between being a full-time student and pursuing his business ventures.
“It has been hard trying not to get consumed by it,” he said. “I now understand those who have decided to drop-out or take a hiatus from school to pursue their ventures; as an international student that’s not an option because my VISA would become invalid, so finding an adequate balance has been a must.”
The HUGS team also faced difficulties due to COVID-19.
“Our business deals with international travel so last year we had to think of how to move forward. Fortunately, international students were still able to travel for education purposes so we focused our time on improving our business model and started our recruiting efforts,” Dumesle said.
Community Connections: Dumesle’s desire to improve life for international students reaches back to his home country Haiti.
Last summer, Dumsele had a separate entrepreneurial endeavor called Biznis Casual, where he taught a virtual lesson each week completely in Haitian Creole to students in Haiti. The business class discussed topics like wealth creation and price versus value in order to help bridge the knowledge gap between the Haitian community and the rest of the world.
With each entrepreneurial endeavor, it’s clear that Dumsele’s focus is to give back to his community.
Global Community: Dumesle and his partner, Bria d’Amours
knew that coming to San Diego would provide them with opportunities and open doors for their business ventures.
“Coming to the US for graduate school for an international student is seen as a shot to success in life. We’re exposed to opportunities that are not present in our countries and HUGS is a testament to that,” Dumesle said. “We chose USD specifically because of the tight sense of community. The MBA program’s small class size gave us the impression that our experience would be much more personal and impactful.”
San Diego Ecosystem: Dumesle believes the San Diego business ecosystem is underrated.
“There is always someone who wants to help you,” he said. “Everyone is connected and there is spring power and solidarity you can’t find in other cities. The people working in tech in San Diego care about value creation and social benefits. They genuinely want to improve the community.”
In fact, the HUGS team gained their first partnership with a landlord from networking in the San Diego business community.
“He is a USD alum. He just came straight out of the community. I wasn’t even looking for him, and he ended up being one of the most successful parts of our business today,” Dumesle said.
Tacos: You can find Dumesle satisfying his taco cravings at The Taco Stand downtown.