2021 Most Disruptive MBA Startups: Andes STR, University of Chicago (Booth)

Andes STR

University of Chicago, Booth School of Business

Industry: Real Estate

Founding Student Name(s): Sebastian Rivas (CEO, Booth MBA 21’)

Brief Description of Solution: We offer our customers a fully turnkey, ML-powered way of investing in short-term rental properties (i.e. Airbnb, VRBO, etc). We use our proprietary technology to find the properties that will yield the highest returns, help customers obtain financing, facilitate the purchase process, furnish the property, and then we manage the property; all that our customers have to do is sign the contract and deposit the funds. Our solution reduces the number of hours an investor needs to spend before owning the property from 200+ down to less than two, and throughout the life of the investment to virtually zero. No need to greet guests, coordinate cleanings, etc. – we take care of everything while our customers make passive income.

Funding Dollars: $1M in seed round

What led you to launch this venture? There were three events that led me to launch this venture. First, when I was working in infrastructure and real estate investment banking in Toronto, most of my colleagues were interested in investing in an Airbnb property, but found it too hard or complicated — even though they knew it was twice as profitable as a regular long-term rental. When sophisticated investors find it too hard to invest in something, that’s a hint that there is an opportunity there.

Second, my neighbor at the time, a software engineer, started working from different Airbnbs in exotic locations every month and told me that not only he, but most of his coworkers, were happy paying twice as much and earning half as much to travel the world while working and staying in high quality short-term rentals. Things were starting to line up.

Then, I tried buying an Airbnb property myself – and discovered it was excruciatingly hard! It took me months to learn everything I needed to learn, a couple more months to find a decent deal, a couple of weeks to arrange the financing, and the whole process was super stressful. And then managing the property myself was simply impossible with the long hours I was working at the time. I handed the property off to a management company, but they did an awful job taking care of it: I literally got a call from the police at 2 a.m. on a Wednesday notifying me that there was a shooting in my apartment! At that point, I asked myself, “Why isn’t there a trustworthy company that can take care of everything for me?” I was not only fed up, but also motivated to help others so they don’t have to go through the same ordeal, and that’s when we came up with our first slogan: “We take care of everything for you”.

What has been your biggest accomplishment so far with this venture? Winning first place in the University of Chicago’s Edward L. Kaplan, ’71, New Venture Challenge, in June 2021. It was an incredibly rewarding experience, but super competitive too. We put in a lot of work and grew so much during the competition. Since then, we have received hard commitments for over 150 properties, which is more than $100 million in assets. That is quite a bit of traction in three months!

How has your MBA program helped you further this startup venture? My MBA has been CRUCIAL for the success of Andes STR. First, the flexible curriculum Booth offers helped me really tailor my experience to balance out any field where I thought I was lacking knowledge. Second, the entrepreneurship program at Booth is really impressive; most classes are taught not only by brilliant academics, but also accomplished practitioners. This means I didn’t just get good frameworks but actual experience. Lastly, going through NVC taught me so much about how to run a company and what VCs look for in a venture, which ultimately is an indicator on how to create value. It’s not a stretch to say that Booth gave me all the required tools and opportunities to become a successful entrepreneur.

What founder or entrepreneur inspired you to start your own entrepreneurial journey? How did he or she prove motivational to you? My dad was the biggest influence I had in terms of entrepreneurship. He has been an entrepreneur for as long as I can remember, and he truly has been a figure to follow for me. Growing up in Chile, I saw my dad start with virtually nothing, working hard and smart to provide for his family while at the same time giving back to the community. He is the kind of guy who leads from the front: the first to charge in, the last to exit the office, and never one to complain. Whenever things get tough, I remind myself of him and put twice as much effort.

Which MBA class has been most valuable in building your startup and what was the biggest lesson you gained from it? New Venture Challenge (by far), Entrepreneurial Finance and Private Equity, and Commercializing Innovation. These were all great classes that focus on the intersection between entrepreneurship and finance. I’ve found that it’s really important to understand these two standpoints well in order to create the most value – entrepreneurship is a lot about thinking big and executing, while finance is a lot about mitigating risks and making sure that the market will accept the entrepreneur’s idea. When both standpoints agree with each other, great things happen. If they are misaligned, then you’re still not there.

What professor made a significant contribution to your plans and why? There are many names I’d like to mention here, but if I had to raise just one, I would say Mark Tebbe. To take the entrepreneurship route as an international student is to take a very risky path. After going through NVC, I had a full-time offer from a large tech company in a sought-after position. This was not only a low-risk option, but also relatively high (financial) return. On the other hand, I had the option to pursue entrepreneurship with venture backing and my best friend from high school as cofounder. Mark spent many hours talking with me, dishing out words of advice, and reassuring me that even if we fail, things are going to be just fine. He helped me believe more in myself and my ability to lead a company. In the end, I made the jump and I could not be happier about it. Thanks, Mark.

What is your long-term goal with your startup? We are going to accelerate the transition from long-term leases to fully-managed, short-term rental living, and become the #1 player while doing so.


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