A photo of of the parties from the "Secret Room"/ "X institute" Facebook page.

Even the most brazen scofflaws can fall prey to San Francisco’s housing market – at least that’s what happened to Troy Do, an undocumented immigrant software engineer who set up a hacker hostel and illegal nightclub above a grocery at 19th and Mission streets.

In June of last year, Do, who uses a fake first name, set up a hacker hostel at 3410 19th St. near Mission Street. He called it the X-institute, and on its website the organization boasts “Weekly coffee hours with experienced Entrepreneurs from Silicon Valley” and “100% focus,” so residents can “Sleep, work & breath [sic] your dream.”

If this story sounds familiar, that’s because Mission Local covered it when a neighbor originally raised concerns at a monthly meeting at the Mission police station. At the time, Do denied that the space was home to a business and said that the money collected for alcohol was not technically a sale, but a donation.

After the article ran, Do reached out and shared the whole story.

It starts with Do dropping out of university where he was studying computer science. He was on a student visa from Vietnam at the time. That was eight years ago, and Do has since well overstayed the visa’s limit. Nonetheless, he says, he’s living a version of his dream.

“I came here because of Hollywood,” he said. “When I was 13 I wanted to be in Silicon Valley.”

He makes a living developing apps for anyone who requires cheap services and pays via PayPal. In June 2015, after developing an app for a friend in real estate, Do and the friend teamed up and founded the X-institute on 19th and Mission streets, where they rented out an entire second floor for $10,000 a month. The two spent $50,000 to renovate the space, he said.  

They then rented out beds charging $1,000 per month per bed. The rooms housed up to two people each, and a maximum total of 10 engineers shared the space at a time.

“The house got boring with a bunch of engineers,” he said.

Luckily, Do’s passion is in parties – specifically, organizing underground “house” parties.

Originally, the idea was to make some extra money by using the open-plan office/living room area to bring in a promoter who would would hire a D.J. for a show.

“There’s a market for house parties,” Do said. “When I go to a new city, I would rather go to a house party [than a club]. We call the parties ‘Secret Room,’ but it’s not really a secret.”

Do started to get a feel for it, but wasn’t turning much of a profit on a $20 cover charge, and selling drinks for between $5 and $8 – even with 400 people attending in a night.  

Fees for the promoter — who would pay the D.J., bouncer and the bartender — ate up most of the revenue and Do ended up making about $800 per party, he estimated. Moreover, guests and promoters failed to show much respect for the space, smoking indoors despite repeated pleas not to do so, and even breaking a window.

So, Do took the reins. He found a D.J., hired an attractive bartender, and hired two security guards, he said. He tried his hand at dealing coke, but found the profit margins unsatisfactory. He paid nearby hot dog vendors to hand out flyers announcing his parties. The cops, he felt, couldn’t touch him.

“The police show up, try to shut us down, but they have no warrant to enter,” he said.

The Wednesday before Thanksgiving, officers made their move.

“It looked like there was the whole Mission station [here],” he said.  

Asked whether he was worried about criminal charges related to his exploits, Do shrugged.

“For what?” he wanted to know. He has a court date set for a disturbing the peace charge, but doesn’t plan to attend. “I’m not even gonna be here,” he said. From the Alcoholic Beverage Control department, he said, he expects fines but not charges, and doesn’t mind.

Still, things at the parties got a little out of hand, he acknowledged. He tried to regulate activity in the clubs, but certain things were inevitable. 

“I tried to clear out the drug dealers, but it’s impossible,” he said.

Other problems arose. One night, Do found a group of gang members posing for photos flashing hand signals at his party. When a disagreement with the bartender arose, she fled the group and locked herself in one of the residential rooms.

Do said the group pursued her, threatened her, and punched through the door. Alarmed, Do asked the security guards to remove the group – to no avail.

Following that episode, Do fired his security guards. They, ex-military members who carry firearms, did not take kindly to this dismissal and reappeared outside Do’s next party in early November to extort him for their nightly pay.

Still unsatisfied, they stuck around, and when Do went on an ice run in the early morning hours, they pistol-whipped him and took his phone, he said – this time, he said, they were with the gang members. They then proceeded to rob the bar of what Do said amounted to thousands of dollars. Do said he filed a police report, but not much happened. CrimeMapping data does show an assault report filed on the block in the early hours of the corresponding date (along with several noise complaints).

These events could not be independently corroborated.

Having cut out the middleman, Do started bringing in money with the parties. But it wasn’t enough. Turnover at the hostel was too high, and Do and his roommates made plans to move out.

More than the cops or state alcohol agents, Do is worried about the incoming president.

“I’m really worried about Trump, so I gotta move fast,” he said.

After one final party Dec. 4, Do moved out of the state.

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  1. I was there a few weeks ago and did witness someone who was said to be security swiping the cash drawer from the bar.