CoLivingiQ: Co-Living & Rent-by-the-Room Investing with Quentin Wendt

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You're not in the sober living business — you're in the admissions business.

Darrell McCollough, founder of Start a Sober Living, opened his first house during the pandemic, filled 20 beds at about $1,700 a bed, and hit roughly $34K a month with a waiting list. In this episode, he breaks down what it actually takes to run a sober living home, for rent-by-the-room and co-living investors who are curious about the model.

We cover:
• Where sober living residents actually come from: reentry, referral sources and aggregators
• Why you have to "follow the flow of money" before you buy a house
• Why your power is in screening, and setting house rules before move-in
• What a house manager really does and costs, and why you don't hire "Uncle Pete"
• Sober living, HOAs and the Americans with Disabilities Act
• Oxford House vs. operating it yourself
• Why this is NOT passive income
• The top 4 states for sober living, and operators charging $10K a bed

Darrell also shares the lens he brings as someone 17 years in recovery, and why that shapes how he builds programs that keep residents.

Chapters
00:00 You're in the admissions business
00:17 What to expect in this episode
00:59 From rent-by-the-room to sober living
02:10 Darrell's story: $34K a month in the pandemic
08:34 Where the demand comes from
13:07 Aggregators: go upstream to find residents
15:23 Build a program so good they tell on you
18:26 Follow the flow of money
22:22 Your power is in screening
24:29 Don't hire Uncle Pete: the house manager
28:11 Sober living, HOAs and the ADA
31:57 What a house manager actually does (and costs)
35:54 Curfews and drug testing
38:41 First house vs. third house
43:09 Why sober living vs. any other exit
44:54 This isn't passive income
48:23 Oxford House vs. operating it yourself
49:45 What makes Darrell's coaching different
53:53 $10K beds and the top 4 states
57:08 Wrap-up and where to find Darrell

Connect with Darrell
Start a Sober Living, with a free webinar every Thursday: https://startasoberliving.com

Own a rental or co-living property that isn't performing?
Book a Business Assessment with Quentin: https://colivingiq.com

Results discussed are the guest's own experience and are not typical or guaranteed. This episode is educational only and is not legal or financial advice.

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One year into co-living, Gordon Sran has learned something most real estate investors don't discover until AFTER they buy the property.

The spreadsheet doesn't tell the whole story.

In this episode of Inside CoLivingiQ, Gordon joins Quentin Wendt to share his journey from real estate investor to co-living operator.

What started as an exciting opportunity to generate significant cash flow quickly became a real education in construction overruns, unexpected expenses, resident challenges, property management, and the realities of running a business.

We discuss:

• How Gordon's first co-living conversion became far more expensive than expected
• Why projected revenue and actual cash flow are two very different things
• The hidden costs of vacancies, maintenance, and resident turnover
• Why Gordon and his partner transitioned from third-party management to operating their properties themselves
• How hospitality, customer experience, and retention influence profitability
• What Gordon would do differently knowing what he knows today

Gordon also shares how mentorship helped him navigate challenges that simply weren't covered in the original investment pitch.

This isn't another conversation about how many bedrooms you can squeeze into a house.

It's an honest conversation about what happens AFTER you buy one.

Acquisition gets you in the game. Operations determines if you win.

If you're considering co-living or already own a property that's not performing the way your spreadsheet predicted, this conversation is for you.

Learn more about building a profitable co-living operating business at:

https://www.colivingiq.com

#CoLiving #CoLivingiQ #RentByTheRoom #RealEstateInvesting

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Buying a Co-Living property is only the beginning.

You can acquire the property, renovate it, furnish every room, and get it ready for residents...

and you still haven't made a dime.

Because the property isn't the operating business.

In this episode of Inside CoLivingiQ, I sit down with realtor and real estate investor Tami Goodwin inside one of my 9-bedroom co-living properties for a candid conversation about what actually happens after you buy the house.

Tami came into the conversation frustrated with traditional rentals and considering a different direction in real estate. After seeing the property, meeting residents, and digging into how the business operates, her reaction was pretty clear:

“I was out of the game... I’m sold.” 

We get into property selection, renovations, financing, room design, resident screening, hospitality, house culture, vacancy, retention, and the financial decisions operators have to make after the real estate transaction is over.

But the biggest idea in this conversation is the foundation of how I teach co-living:

Most new investors start with acquisition. I believe you should start by understanding operations.

Once you understand the business you're trying to operate, it changes what you buy, where you buy, how you finance it, how you convert it, and ultimately how you position that property to make money. 

We also get into the real economics of resident retention. When a good resident asks for a small reduction, the question isn't simply whether you're willing to lower the rent. You have to compare that cost against vacancy, turnover, remarketing, and the unknown quality of the next resident. 

That's what Inside CoLivingiQ is about.

Not the sales pitch.

The actual business happening inside the house.

Learn more about CoLivingiQ:

CoLivingiQ.com

Acquisition gets you into the game. Operations determines whether you win.

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One of the most expensive mistakes a co-living investor can make happens before the first resident ever moves in.

It happens when you buy the property.

In Part 3 of the CoLivingiQ Framework, we bring HostIQ and ConversionIQ together to answer one of the most important questions in co-living investing:

What can I actually afford to pay for this property?

I walk through a real example with a first-time co-living investor.

The property was listed at $176,000.

The initial recommendation was approximately $159,000.

After analyzing the operating business, expected revenue, conversion requirements, financing and the economics of the deal, we determined our maximum allowable offer was $133,000.

The deal ultimately landed at $139,000 with an additional $5,000 in repair concessions.

That’s $20,000 below the initial recommendation and $37,000 below the original list price.

This wasn’t about lowballing the seller.

It was about knowing what the business could afford to pay and having the confidence to let the economics — rather than fear of losing the property — drive the decision.

Because if you overpay today, your operating business has to make it up tomorrow.

Every. Single. Month.

That completes the CoLivingiQ Framework:

HostIQ → Learn the Business
ConversionIQ → Build for the Business
AcquisitionIQ → Buy for the Business

Learn the business first.

Determine what the physical product needs to become.

Understand what that conversion will cost.

Then work backward into what you can afford to pay for the property.

That’s how we begin to de-risk co-living before we ever buy the house.

Want to apply the framework to your own deal or portfolio?

Start with a Co-Living Business Assessment at CoLivingiQ.com.

Rent Smarter.

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“How many bedrooms can we fit in here?”

That’s one of the first questions many co-living investors ask their general contractor.

I think it’s the wrong first question.

Your contractor operates a construction business.

You have to operate the co-living business after they leave.

In Part 2 of the CoLivingiQ Framework, we move from HostIQ: Learn the Business to ConversionIQ: Build for the Business.

Once you understand who your customer is, you can reverse engineer what the physical property actually needs to become.

How many bedrooms make sense? How large should they be? Private or shared bathrooms? What amenities matter? How much parking do you need? Where should you spend money — and where shouldn’t you?

I also break down a real property from my portfolio that went from 5 bedrooms and 2 bathrooms to 9 bedrooms and 6 bathrooms, including four intentionally designed private bathrooms.

Those bathrooms weren’t simply construction decisions.

They were product decisions. And they were revenue decisions.

Because more bedrooms do not automatically mean more profit. And a more expensive renovation does not automatically produce higher room rates.

Every dollar invested into a conversion should have a reason for being there.

HostIQ → Learn the Business
ConversionIQ → Build for the Business
AcquisitionIQ → Buy for the Business

Before you renovate a house, understand the business that house needs to support.

Start with a Co-Living Business Assessment at CoLivingiQ.com.

Rent Smarter.

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Co-living is often sold as a real estate strategy.

Buy a house. Add bedrooms. Create multiple streams of rental income. Increase cash flow.

That’s true. But it’s incomplete.

Because once you buy the property, somebody still has to operate the business inside of it.

And a bedroom doesn’t pay you. A customer does.

In Part 1 of the CoLivingiQ Framework, I introduce HostIQ: Learn the Business.

We break down why successful co-living is not simply an asset-management business. It’s also a people-management, hospitality, marketing, sales and customer-service business.

We’ll talk about identifying the customer you want to serve, building the right experience for that customer, reducing friction during their stay, improving retention and tenure, and why the platform you use to acquire a resident should never become your entire business.

Because people may initially come for the price.

They stay for the value.

The CoLivingiQ Framework:

HostIQ → Learn the Business
ConversionIQ → Build for the Business
AcquisitionIQ → Buy for the Business

If you own a co-living property, are considering your first one, or want to improve the performance of your existing portfolio, start with a Co-Living Business Assessment at CoLivingiQ.com.

Rent Smarter.

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If your rooms only fill when a platform sends you somebody, do you really own a business, or just a listing? After 5 years at PadSplit working with hosts on vacancy, occupancy and tenure, Quentin shares the referral system he built for his own co-living portfolio.

In this episode:
- Why "lower your price" is the most common and least helpful advice new hosts get
- How vacancy anxiety and FOMO lead to approving the wrong member
- The 12-week commitment, the $175 flexibility fee, and the good renters they filter out
- Treating the platform as a vendor and lead source, not your whole business
- How one Thanksgiving dinner filled 3 of 7 rooms through referrals
- 6 referral sources: current members, local employers, staffing agencies, travel nurses, trade schools, and your own content
- The guardrails: screening standards, house agreements, and customer education

Chapters
(00:00) You don't own a business, you own a listing
(00:49) Who I am
(02:52) Waiting on bookings isn't a strategy
(04:49) The friction nobody talks about
(05:57) The 12-week commitment problem
(11:48) Treat the platform as a vendor
(13:50) Run co-living like hospitality
(14:37) 3 reasons referrals win
(16:50) Real referral stories
(18:48) 6 referral sources
(24:56) The guardrails
(25:33) Customer education
(26:53) The big takeaway

Resources
- Work with Quentin: https://colivingiq.com
- Watch the video version: [YouTube link]

PadSplit commitment terms referenced are from PadSplit's Help Center.

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A change in PadSplit’s fee structure completely changed the way I thought about my co-living business.

It made me realize something important:

Filling the room wasn’t enough anymore.

After spending five years inside PadSplit, working with hundreds of hosts while also operating my own co-living properties, I had a front-row seat to how the business worked—from both sides.

When PadSplit moved from its original 12% fee structure to a model that included the first 10 days as a booking fee followed by an ongoing 8% fee, I started looking at what that change actually meant to me as a property owner.

Not in percentages.

In dollars.

Because owners and entrepreneurs don’t deposit percentages in the bank.

We deposit dollars.

Take a room renting for $210 per week.

That’s roughly $30 per day. Ten days represents approximately $300.

Under the old 12% model, PadSplit would have collected about $25.20 per week on that same room. It would take roughly 12 weeks for those fees to reach $300.

That math gave me a completely different way of looking at the business.

In my mind, this wasn’t simply a change in fees. It changed how I thought about who carried the financial risk of a short stay.

And if I was going to carry more of the consequences of turnover as the property owner, I needed to stop thinking only about:

“How do I fill this room?”

I needed to start asking:

“How do I make a good customer want to stay?”

That question changed everything.

It led me to start thinking about hospitality as a business strategy.

The listing. The photos. The videos. Setting expectations before move-in. The move-in experience itself. Communication. House meetings. How problems are resolved. Creating community without trying to force community.

Those aren’t just little operational details.

They’re part of the economics of running a co-living property.

And that way of thinking ultimately became the foundation for CoLivingiQ and the systems I use today.

In this episode, I walk through that evolution—from the fee structure and the math that caught my attention to why I now focus so heavily on hospitality, member experience and tenure.

Because getting the booking isn’t the finish line.

It’s the beginning of the economics.

EPISODE CHAPTERS

00:00 — How I Changed the Way I Think About Co-Living
02:20 — The PadSplit Fee Structure That Changed Everything
02:54 — We Don’t Deposit Percentages — We Deposit Dollars
03:49 — The Risk Shift: My “Toll Collector” Realization
04:42 — Filling the Room Isn’t Enough
05:15 — Why Hospitality Became a Business Strategy
07:15 — How This Thinking Became CoLivingiQ
08:20 — Hospitality → Tenure → Profitability
10:18 — You Don’t Need to Copy My Business
10:31 — No Margin, No Mission

THE BIG IDEA

I show a lot of what happens inside my properties—the move-ins, house meetings, dinners, conversations, problems and solutions.

There’s a reason for that.

I’m not interested in creating systems just for the sake of having systems.

Systems have to produce a result.

For me, the result I’m designing for is longer tenure through a better customer experience.

And that leads to the philosophy behind the way I operate today:

Hospitality is the strategy.

Tenure is the metric.

Profitability is the byproduct.

You can copy the things I’m doing. In fact, I hope you do.

But you don’t need to copy my business.

You need to understand yours.

Where are you making money? Where are you leaking money? What’s causing turnover? What increases tenure? And what repeatable systems can you build to improve both the member experience and the economics of your properties?

That’s what we’re building at CoLivingiQ.

Learn more at CoLivingiQ.com

Rent Smarter.

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In this episode of Inside CoLivingiQ, I sit down with Pat, one of my actual co-living customers, for an unscripted conversation about what it's really like to live in shared housing. 

We talk about her expectations, what actually mattered once she moved in, and the small touch points that shape the experience of living in a co-living home. 

Pat also shares what prospective members should ask a host before booking a room, why customer service matters after move-in, and how the culture inside a house influences whether people actually want to stay. 

For operators, there's a clear lesson here: the platform may bring someone through the door, but once they're living in your house, they're your customer. 

No pitch. No how-to guide. Just a real conversation about co-living from the customer’s side. 

Inside CoLivingiQ is my ongoing project to document the human side of the co-living business. 

Hosted by Quentin Wendt CoLivingiQ

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I filled my last two available rooms this week — and one of them came with a complication I legally couldn't refuse. This is the first episode of "Real Life CoLiving Operator Stories," where I start sharing the unfiltered version of running a co-living portfolio — not the how-to guide, the actual week-to-week reality.

Story one: a new PadSplit member moves in with an emotional support animal that wasn't disclosed until move-in day. Federal law means I have zero discretion to say no — but my existing house community, who'd known each other for months, wasn't thrilled. I'll walk through exactly what I told the house, the advice I gave the new member that went against his own instinct, and why it worked.

Story two: "the professional interviewer" — a booking that went so smoothly it should have been a red flag. I'll tell you what happened in the first week, and why this one's still unresolved as of this recording.

Both of these came down to the same room: the last one I had open. And that's the real lesson — the last room you rent in a full house is always the riskiest booking you'll make, because one bad fit has the power to unravel a community that took months to build.

If you're a co-living operator, host, or landlord dealing with ESA accommodation requests, screening red flags, or managing a house through a new move-in, this episode's for you.

Got a story or topic you want covered on the show? Email [email protected] or DM me — I'd love to feature it.

🏠 Learn more about how I run my co-living portfolio: https://colivingiq.com
📅 Free weekly webinar, every Thursday at 12pm ET: https://colivingiq.com/webinar
📞 Book a free assessment call: https://calendly.com/quentin-colivingiq/colivingiq-assessment-45min