How I Bootstrapped An Airbnb Management Service To $35K/Month

Hello! Who are you and what business did you start?

My name is Gary Fox, and I run HostButlers, an Airbnb concierge service in Dublin, Ireland.

HostButlers was Ireland's first professional property concierge service for short-term rentals. A property concierge simply makes it easy for a landlord to become an Airbnb host. We do a lot of the day-to-day tasks such as guest communications, organising cleaners and even meeting and greeting the guests when they arrive.

It’s a plug and play solution for people who wish to become Airbnb hosts but need some assistance. Some of our hosts travel a lot or they are busy with normal jobs so we come in and fill in the gaps for them.

Since we started nearly four years ago, we have hosted over 200,000 people and have been profitable from month 5.

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What's your backstory and how did you come up with the idea?

I’ve been starting businesses since I was 15. During school, I worked part-time in a mobile phone store and learned how to fix phones. During the weekends, I started my own market stall and advertised online to fix phones, replace screens, and started to earn cash that way. During college, I scaled up this business to a physical location at the University I was attending here in Ireland. I approached the college and rented an office space from them and opened my first store!

I was terrified of running out of money and for the first 18 months, I ran the company entirely on my own. I remember one particular day where I met 18 different guests at 18 different locations across the city.

Between classes, I would work in the store and when I was in class, I hired classmates and friends to work for me. Looking back now, it was an incredibly fun time but I wish I hadn’t reinvested so much money in the college bar!

In 2015, I was visiting Washington for one of my best friend’s wedding, and stayed in various Airbnb’s as we did a mini road trip from Washington to New York. One year earlier, I’d started my entrepreneur ideas book. It was a blank notebook that I forced myself to write down one new business idea per day. Weirdly, a concierge service for Airbnb hosts was the first ever idea I wrote in the book but didn’t take any action on it for over a year.

During that trip to Washington, we had some really mixed experiences with Airbnb hosts and I realized how time-consuming hosting was if people wanted to do it to a really high standard.

At the time, I was working in a large tech company but I always wanted to go back to working for myself. My personality just doesn’t fit in the 9-5 office life.

I was pretty low on funds as a previous startup in the video space hadn’t worked out, costing me two years of my time and a serious amount of personal cash. I needed the day job to pay off bills and live, so I decided to test the idea for HostButlers in the evenings and weekends.

Take us through the process of designing, prototyping, and manufacturing your first product.

To start, I really had very little idea of what I was doing. I wasn’t from a hospitality background but I had worked in retail for over 5 years. I applied the best practices I’d learned from that industry and tried to transfer it directly into my new business.

Stop overthinking it and launch the leanest, most basic version of your product or service that you can. Only when you launch will you see if there’s demand or not.

Although the idea for Airbnb management/concierge services wasn’t being done in Ireland, it was getting popular in the United States and the UK. I researched all the market-leading companies in those markets, sending off endless inquiry emails and going through their sign up processes. I became a fictional customer to learn exactly how it all worked, what the costs were and most importantly, where the opportunity was for me to launch this.

I took the learnings from other companies and created a really basic SurveyMonkey form and used targeted Facebook ads to promote it to people in Dublin who were already Airbnb hosts. This was back in 2015 when it was still very cheap and relatively easy to target the exact people you wanted and also gain some organic reach.

how-i-bootstrapped-an-airbnb-management-service-to-35k-month My original Facebook ad to validate the idea

I had plenty of experience as an Airbnb user but zero as an Airbnb host. I needed to know the pain points of hosts and identify if there was a demand for a management service.

Two weeks later, I had 30 responses and enough demand to convince me to kick off the task of creating the business.

Describe the process of launching the business.

The next step was to create a website. To keep costs low, I designed and built the site myself, using Squarespace. I’m not technical but I wanted to create a professional presence as I knew the look and feel of the brand would be really important. After all, you are asking someone to trust you with their reputation. I needed something that looked really expensive but cost very little!

I used royalty free images from Unsplash and Pexels to add some high-quality imagery to the site and got a designer friend of mine to create a logo for €60.

HostButlers has been self-funded/bootstrapped from day 1 and continues to be in 2019.

It’s incredible what you can achieve when you are forced to be creative due to constraints. Even now when we are trading profitably, I try to keep the mindset of “Doing more with less”. It’s very easy to throw money at a problem but often the solution lies in removing things or processes from a situation.

I timed the launch to coincide with The Web Summit which is the biggest tech event in Europe. It has since moved to Lisbon but in 2015, it was held in Dublin and attracted over 30,000 people to the city over a 3-day period.

In the weeks leading up to the Summit, I used Facebook geolocated ads to target a 5kms area around the venue as I had heard there was a shortage of accommodation and I thought people would become Airbnb hosts in order to cash in on the situation. I assumed many people would be first time hosts and once they realised how much work is involved with guest communications, preparation, greeting, and cleaning that they would want to outsource the job.

Within a few weeks, I had signed up two potential clients and decided to launch the service. Up to this point, I had nothing except a website. I now had to rush to find cleaning suppliers and build systems to support the business.

Once I launched, everything happened extremely fast. I signed two clients within weeks and they wanted me to take over running their properties immediately.

I still remember going to meet the very first guests. I raced down to the apartment, grabbing croissants, and fresh orange juice in the local store on the way there. I was there over an hour early, I was so keen to make sure everything went well.

Finding cleaners was a bigger challenge. I placed ads on Facebook and Gumtree and began testing them. I had no properties at the time, so in order to check their standards, I had them carry out test cleanings on my apartment and apartments of my friends.

Don’t spend months planning the perfect launch. It doesn’t exist. The launch will be messy and throw up all sorts of problems you didn’t even know were possible. Launch and learn as you go.

Since launch, what has worked to attract and retain customers?

After the success of my Facebook ads, I kept running new ads every month for around six months. I would change up the copy and it delivered reasonable results. I had assumed all my hosts were tech-savvy, young millennials who consumed a large amount of social media. I was completely wrong.

I had started to run a series of Airbnb host workshops to bring together hosts and share best practices. I viewed this as a win/win as it provided value to potential clients and allowed me to present myself as an authority in the space.

I invited a travel blogger along who also happened to write freelance articles for a well-respected newspaper here in Ireland, The Irish Times. She was fascinated by the business idea and pitched a story about us to an editor. It was accepted and that article changed the future of my business completely.

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When the article was published, I couldn’t believe it. It was previewed on the cover of the newspaper, and it got a full page in the business section of the paper. The phone started ringing immediately. I vividly remember going to the local shop to get a copy of the paper and before I had returned home, I already had a call from a potential supplier who wanted to work with us.

Link to Article

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Traditional media still has a massive part to play in your marketing mix, and most importantly for me at the time, it gave me instant credibility. Even today, almost 4 years later, I ask every new client where they heard about us and people still say they read about us in the newspaper.

We do zero advertising at the moment. This is due to a combination of factors. We have been in Dublin almost 4 years now so our ranking for “Airbnb management Dublin” is always within the first couple of results on Google.

At the start, I focused on getting the basics right. I added my Google Business location immediately and got a couple of reviews as quickly as possible. It was vital to establish a reputation and a physical location to build trust with my clients.

I wrote frequent weekly blogs on the subjects related to Airbnb hosting, tips of hosts and generally acted as a useful resource for aspiring hosts.

The most important acquisition channel always has been providing a great service to clients and they then go and tell their friends and colleagues. This has been the number 1 source of new business and continues to be that way. This is not the sexy answer and you can’t just turn it on by hiring a consultant or paying for ads.

In today’s world you are competing with automation and poor customer service. Be the company that puts the personal touch back into businesses. If you are selling to a local market, this will be the single biggest success factor in the early days. Put a physical address, a phone number and a short bio of yourself on the website. Build trust at every stage.

How are you doing today and what does the future look like?

HostButlers will be 4 years old in November and about 50% of our new customers come from word of mouth and the rest is organic traffic from Google. We have social channels but do not use any paid advertising for a number of reasons.

Timing is everything in business but it’s often overlooked. I know for a fact, that if I wanted to start this business today, it would fail within months.

When I started HostButlers, Airbnb was seen as an exciting new development, offering people the chance to make some extra money from their home. In the last 12 months in Ireland, and across the world, there has been a huge public backlash against Airbnb.

New regulations are being proposed here in Ireland, that would limit Airbnb to just 90 days per year per property. This will severely limit people’s ability to earn money from the site.

HostButlers was profitable after 5 months and continues to be profitable each month. Our market is very cyclical, the majority of our money is earned during the traditional tourist high season of March to September. March is incredibly popular here in Dublin as it’s St Patrick's Day and this brings a huge amount of visitors to the city.

We have 4 staff members, 3 full-time and 1 part-time based in our office in Dublin City.

Due to the proposed Government crackdown on Airbnb and short-term rentals, we are combining our short-term solution with a new product aimed exclusively at the corporate market. The minimum stay will be 30 days and focus on companies relocating to Ireland. Dublin is a hotspot for new office development at the moment due to a booming economy, the large hub of international tech companies based here and as a result of companies moving to the city due to Brexit.

how-i-bootstrapped-an-airbnb-management-service-to-35k-month

Through starting the business, have you learned anything particularly helpful or advantageous?

It’s a massive cliche but just start. I spent too long thinking about the business and working on fluffy tasks such as the name. I had to change the name within 3 months after a company hired a large legal firm to try and sue us as they deemed that we infringed on their copyright. I agonised over the name but when faced with the threat of changing the name or being taken to court, I was able to rebrand within 24 hours. Don’t sweat the small stuff. Focus obsessively on building the best possible product for your customers, that should really be your only focus.

As the business was bootstrapped, I was terrified of running out of money and for the first 18 months, I ran the company entirely on my own. Looking back, I have no idea how I managed to hold it all together as I was doing customer check-ins, coordinating cleanings, guest communications and new customer sales. I remember one particular day where I met 18 different guests at 18 different locations across the city.

What platform/tools do you use for your business?

As mentioned, I used Squarespace to build my site. I love this product and have used it to build 3 other sites since.

I use Hostaway, a platform manager software to manage all our Airbnb listings. This allows us to manage all listings in one place and coordinate cleanings and communications. I was using a combination of Google Sheets and email when I started and it was a nightmare!

We use Google Suite for a huge range of tasks. Google Calendar is our bible, as we arrange set times with guests to meet them at the property. Everything goes in the calendar, meetings, reminders, tasks.

To manage and keep track of all my projects, I use Notion. I had previously used Evernote but moved to Notion as it allows you to manage your projects in a very interactive way.

I’ve just started a podcast called “The Entrepreneur Experiment” and I use Libsyn to host and distribute the feed.

What have been the most influential books, podcasts, or other resources?

Books are both my financial weakness and my greatest source of inspiration. I have about 5 books piled up on my shelf waiting to be read at any given time. I try and read about 1 book per week. Non-fiction in the mornings for 30-45 minutes and fiction before bed to wind down. You can follow me on Goodreads if you want to keep track of what I’m reading.

My top 5 books for entrepreneurs are:

  1. Losing My Virginity by Richard Branson
  2. Power of Habit by Charles Duhigg
  3. Elon Musk by Ashlee Vance
  4. The E-Myth Revisited by Michael Gerber
  5. The 4-Hour Workweek by Tim Ferriss

Top 5 books I’ve read in the last 6 months are:

  1. Company of One by Paul Jarvis
  2. Atomic Habits by James Clear
  3. Deep Work by Cal Newport
  4. Oversubscribed by Daniel Priestley
  5. Bad Blood John Carreyrou

Podcasts I listen to:

  1. Tim Ferriss Podcast
  2. The Daily from the New York Times
  3. Business Wars
  4. The Knowledge Project
  5. The Mike Dillard Podcast
  6. Joe Rogan
  7. How I Built This

Advice for other entrepreneurs who want to get started or are just starting out?

Stop overthinking it and launch the leanest, most basic version of your product or service that you can. Only when you launch will you see if there’s demand or not. There are so many free or close to free products such as Squarespace, Amazon Web Services, etc that you can start a business for under $100.

Be ruthless with your costs. In the the early stages, track everything! Know exactly how much money you are making per hour or per product. Factor in everything from tax, to VAT and labour costs. Knowing your profit margins will ensure you make it past year 1. It will also allow you to focus on the products that are making you the most margin and double down.

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Focus obsessively on your product. Don’t get sidetracked by shiny tasks like logos, names, social media campaigns. No amount of fancy marketing will make up for a crap product.

Don’t raise money or seek debt unless it’s a completely necessity. Focus on funding your business through sales. I’ve seen so many founders create zombie businesses that cannot survive in the wild but rely on Government funding or loans to keep going.

Be curious and a constant learner. Approach every new situation as an opportunity to have a new experience. Don’t let your nervousness about starting a business make you lose your instinct to learn. Entrepreneurs can often feel like imposters or that they are faking it. Be honest, be open and when you make a mistake, assume total responsibility and move on.

Build a business that can survive without you. The biggest mistake every entrepreneur makes is to build a business that relies heavily on them. In our rush to get our business into the world, we forget to take the time to build processes and methods of working that can be repeated in our absence. Could you business survive if you vanished for a week? If the answer is no, start building systems that operate even when you are not around. Apart from starting the business, building the systems to remove yourself from the day-to-day operations is the hardest task you’ll ever face.

Where can we go to learn more?

I love to connect with fellow entrepreneurs and aspiring entrepreneurs. My new project, The Entrepreneur Experiment is all about sharing my journey as I document the process of building a new business from scratch. It will create a blueprint for aspiring entrepreneurs to follow. Please do connect using any of the personal channels above and reach out to say Hi or ask a question.

If you have any questions or comments, drop a comment below!

-  
Gary Fox,   Founder of Host Butlers

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