How to Make $3M/Year with Airbnb Business

meet Sid and Eva a power couple who started their three million dollar a year passive income business on the side of their full-time job in today's episode they show us exactly how to build an Airbnb business using Secrets only Hotel owners know of but also reveal how you can start a similar business for shockingly less than you would expect the first thing is you want the rental income to cover all your expenses it's roughly 200 to 400 000 a month or so is a gross revenue and this is a really great hack for in Real Estate Investors the return they're having right now is about 20 to 30 percent so those are three ways you can do it with zero to little money let's get started shall we [Music] big thanks to bittrex24 for sponsoring this video the Airbnb rental investment and Property Management business so good to be with you thanks so much for having us yes so uh tell us where are we and what are we doing today right yes so we're in Seattle a neighborhood called Madrona which is close to Capitol Hill this here is our Airbnb which we acquired as a second investment and um why don't we show you guys inside here all right let's go alrighty oh beautiful thank you tell us a little bit about your background before getting into Airbnb Investments and Property Management how did you get into this business we have full-time jobs we've been investing in real estate for more than 12 years mostly in long-term rentals so that's one of actually the strategy for first-time investors it's great to buy your primary home lived in for a one year move out and you can turn it into a rental property so we bought this home in Seattle for primary home to live in and after we close the home and we found out from the seller that the home was actually a Airbnb property before so we got super interested and we did a lot of research ourselves as well about hotel management did an ROI analysis and we wanted to try it ourselves so while we were living in the home we bought the furniture we did the painting ourselves and we did all the decoration ourselves and when we move out we turned it into our first Airbnb tell us some of the basics of this location how many beds how many baths and how much something like this typically ran out for yeah so this house is a four bedroom three bathroom and it also has a special amenity of a home theater room which I can show you guys afterwards as well summertime is usually peak season of Seattle travel season so summer would be anywhere between 500 to 900 000 a night or so and winter you would probably find this house for 300 to you know 400 500 or so but the demand is high we try to price higher to match the demand when the your demand is lower we try to price your houses competitively so that we can get booked as well it might be a little bit early on to ask this but you two are very obviously extremely successful in the business that you're doing so what are the skills that are necessary to get to this point right I think there's three skills that you need to succeed not just an Airbnb business but in any business in general three skills almost guarantee you success in Airbnb or almost any other business keep watching to find out how to grow those or get those in the first place where did you get the money to buy your first property yeah I actually have a interesting story for that so I was still in college at that time I still remember living in a very small room paying 300 for rent I was working two part-time jobs and what I did was I saved up all my student loan money and bought my first property for fifteen thousand ended up spend some money on the rehab and then rent it out for I think it was 700 per month so that was my first rental property so paid back by itself I think in two years time or so are there any finance options for people who want to get into real estate but they don't have enough money in savings to purchase their first home right yeah I think there's three different ways you can do this first is and this is a really great hack for in Real Estate Investors you can buy a home as a primary home in which you decide to live in it and then you rent out some of the rooms by you know by room to other people and that way they could pay off your mortgage every month and then you can live or doing that the second way is you can actually get a hard money loan from a private lender and you can use that money to purchase real estate as well the third is more specific to airbnbs which is called rental Arbitrage for rental Arbitrage you rent the house from owner and then you convert that to an Airbnb you make the difference in money from the Airbnb income and the rental income so those are three ways you can do it with zero to little money so it's easy to find clients on Airbnb because they just search on the website obviously but how do you find clients for your property management business if you found this through Google search and so we wanted to make sure we get high up on the Google ranking to make sure our clients can find us ranking your business as number one on Google is simple if you know this step so stay tuned as Sid is going to share how to do that all right tell us where we are and how far away from the other property we're at yeah we are actually in lashai of Seattle about only half a mile from the last property and uh let's go check it out okay [Music] all right so tell me a little bit about the place yeah so this is a single family home and we have six bedroom here four bathroom can fit 14 people and how often is this rented out during the year this was actually pretty solidly booked out just because there's not a lot of other single-family homes which could group this large and so most guests choose our this house it's typically 85 occupancy level or so so the last property that we were at you owned but this one you just managed but don't own it is that right yep that's right okay so how did you get this property and how did you manage the fee that you charge for managing it so the owner reached out to us through the web search we charge 25 for our management fee which includes all the Linens restocking even the trash management and everything so what would this typically rent for if you were to post it on Craigslist versus how much are they making um through you guys managing it on Craigslist for Zillow or some adults where you would post this for long-term rental this would be roughly 6 thousand dollars a month that sounds high but Seattle is a very high cost of living location we typically help them anywhere between 50 or higher 100 higher returns after all the management fees all the utilities after cleaning fees so a house like this for the owner would be roughly double the profit they would make yeah versus a long-term rental wow okay so five thousand dollars on Zillow but after expenses after paying you they might get ten thousand dollars absolutely yep that is a big value how much did the owner invest in this house and what are the returns so the owner actually did a full house remodel for this including Furniture it's about two hundred thousand dollars the return they're having right now is about 20 to 30 percent uh return on investment so a typical stock market as we know the return is about 10 with a you know Airbnb is a higher risk investment so you should expect higher Returns on that as well how often are Furniture accessories breaking and how do you go about replacing and fixing those yeah it's funny you mentioned that we typically have something or the other happening breaking every one or two stays or so and the way we've devised this is standardization so every single thing the chairs you see are the same in all our houses so if once your breaks we can always get a spare chair from our inventory and just swap it out quickly so that way we can turn the hustle around in the same day without having to wait for one week for a new chair to arrive how do you find that that contributes to maintenance costs operation costs just to give an example if we have the same bed or the same chair in every single house we don't need to have multiple spares of every single type of bed we have we can only have one chair so that if one breaks all the 20 houses are supported and the same for the bed frame as well so we've had bed frames break after guest days so instead of having 20 spares we will only have one and then we can swap that out and we can replenish it and so that store reduces our inventory holding cost so can you give me a price breakdown for how much that would cost if you didn't have a systematized versus if you did right yeah so just to give an example of the bed frame right if we had 20 different houses with 20 different varieties of bed we would have each bed cost 200 or 250 or even 300 or so on the conservative side we have 20 different bed frames we need to have and multiply by 200 or so that's roughly four thousand dollars inventory holding cost now if I have the same bed for all my 20 houses my inventory only cost is one bed alone and that's only two hundred dollars that cost ends up being enormously different and that cost savings is how we're able to reduce the cost structure faster savings on door owners do you follow a model to build your business and which one did you choose and why we actually follow something similar to the Amazon fly wheel which is really famous which Jeff Bezos created on his napkin so we have something like that as well so we start with a really great design for the house and Doctor tracks a lot of people who want to you know stay there and experience it themselves and then we follow up with that with a great delivery of great customer experience and that leads to great reviews once we get the great reviews people can trust us more and they will book this house more and that can increase as our occupancy on our nightly rates as well which in turn attracts better owners because people see that they can get higher returns who are willing to invest with us and you know for you know invest in great Quality Furniture great quality amenities and that leads to great work your cycle that's on the revenue side on the cost side there's a second piece of the flywheel as well we try to keep our cost structure down by focus on operational excellence one of the things we do is we want to make sure all the properties are really close to each other so that we can save in cost of traveling between properties you know when we're doing cleaning when we're doing maintenance for example and you know inventory cohort and costs are lower as well because if you have all the same Furniture same amenities in all our houses we only need one set of sofa for all our houses one set of coffee machine instead of having 10 different coffee machines you know that cost savings we pass it on to our owners as well who can then reuse it to reinvest in profits and you know it's a great business model win-win hey guys are you looking at Sid Neva and thinking that their ideas on a business model are incredible are you wondering how to manage your business as seamlessly as they do but don't know where to start well we got you bittrex 24 is a platform that can get your next Airbnb or business of your choice up and running and completely for free with over 35 tools available you can increase sales improve Communications by providing outstanding customer support through chat and video track marketing campaigns create websites or landing pages and effectively manage employees all in one place not only is bittrex 24 100 free but it's great to manage any business regardless of industry or size so why not optimize your workflow with bittrex 24 today get ready to join over 12 million users worldwide by clicking the link in the description below so you guys have very nice bathrooms nice materials are you trying to customize like the bathrooms and other areas in the house we don't uh encourage the homeowner to do a lot of customization for the home because we in order to save on cost we encourage standardization um so say talked about standardization and then for bathrooms as well one of the things we do change for our owners um you know when we do it is as much as possible change to a fixture is as intuitive as possible when you're using it so this is where you intuitive that you know that it needs to get rotated on the red side and a blue sign there some of the fixtures feel like you need to pull them whereas they actually need to be rotated so that's the only thing we try to make sure is our bat fixtures are as intuitive as possible to guests to use what is your average revenue in a month and what are your typical profit margins so Revenue really depends on the location and how the size of the home so it can range in the summer time from 10 000 to 30 000 per month and in the winter time three thousand to 10 10 000 a month so do you know the total overall figure of how much your average revenue is yeah so it's roughly 200 to 400 000 a month or so is a gross revenue management fees is typically 25 of that which is ends up being a hundred thousand uh per month or so on average all right and how about your profit margins our profit margins are uh roughly 30 or so our cost of goods sort is roughly 35 which includes the cost of labor for property managers it also includes the cost of goods for our restocking fees Linens and also cost of software sgna is roughly another 35 percent or so which ends up being total 70 in cost and then 30 margin what are the main things you look for to tell you that a property is going to be a good investment or not yeah there's three things that we look for one is definitely a location so for Airbnb you wanted to be in a location where tourists are coming so which means Central Seattle is a great location to be and second thing is profitability so when you buy a home you want to make sure the revenue that you're generating from Airbnb minus management fee minus cleaning fee your mortgage insurance property tax and at the end you still have some cash left over of course the third thing is trying to avoid HOA homes which is Homeowner Association why is that because there's a lot of restrictions in HOA a lot of them you will not be able to run Airbnb with HOA because they require you to have rental term that's longer than 30 days so those are the three things are there any red flags property investors should avoid absolutely I think there's two major things you want to think about first is when you're buying it as an Airbnb you want to make sure that you can run this business as an Airbnb so in Seattle we do not have homeowner associations or hoes that even spoke about out but we do have something called ccnrs which is Covenant conditions and restrictions which may hinder your ability to rent for example they would write it down that you cannot rent as a business or you can order it less than 30 days or so so that's something you want to be careful of second thing is not really about Airbnb but you also want to be careful of is that you're not just buying an Airbnb you're also buying an investment which is there for the long term so you want to think about resale value and work in Banks to resale value in the location you're buying in for for example in Seattle one of the big things that defines this resale value is we typically have weather which is uh you know raining for most part of the year so definitely yeah and so one of the things you want to be careful of is people do tend to see causes which get sunlight in the daytime so that they can actually in those 10 days of per month or so we get sunlight they can actually enjoy that Sun so typically south facing homes are best facing homes are much more desirable in Seattle so you want to you want to buy a house like that and the second continue and also be careful of is you don't want to buy something at a major intersection or like something on you know with airplane noise or something because this will also impact your diesel value have you made any bad Investments as an investor and what are the biggest mistakes you've made one of the big investment failures that we had was we ended up buying a house on Florida which had a couple of issues the first was we had underscoped the amount of work that we were doing and the second one was we ended up hiding a poor choice of contractor and that ended up causing us issues with you know having to fire the contractor go through a lawsuit you know and recover money as well and so that was that was a big issue in terms of learnings I think one thing was we ended up buying this property remotely without seeing this in person and so one of our big learnings is always always go into the property check it out yourselves because you don't know like you know what what the difference is between what you see in a video versus in person and the second thing for contractor I think we end up realizing is when we do remote models we want to make sure if you're spending fifty thousand dollars an immortal we are making a double the money which is two weeks a hundred thousand dollars in equity to compensate us for the risks that we're taking which is you know like lawsuits the cost of capital and you know projects can be derailed what are the best places to find profitable investment properties actually you can find good property everywhere uh what's important is two things the first thing is you want the rental income to cover all your expenses so at the end of the day your cash flow positive the second one is also the most important one is finding the right people so especially if you have properties out of state you want to make sure that you have the right property managers right cleaners right contractors to help you to manage the place is there a correlation between the prices that you see for homes in the open market versus how much you're able to rent those out for on Airbnb because real estate is such an ill-liquid Market you can find areas of opportunity there are some homes which will be priced below what they will rent for until some homes conversely will be priced way higher than what they can rent for so the whole point of real estate investing is you find these areas of opportunity in which you buy a house and you can essentially rent it for hire whether it be through long-term renting or through Airbnb and that that's possible in every single Market that we try to invest in you can find those areas of opportunity all right what do we have here so we're really sweet room so does this make a difference for people when they are choosing a location yeah for sure like we love this home theater room as well and our guests love it as well they would love to have their children here watch Disney together or Disney movie or Pixar movie we've in fact actually had guests come here book this house just for the Super Bowl we will have a viewing party together as well and the guests for local especially in Seattle it's raining outside a lot of times so having a home theater room really stands out from the competition in the winter time what is the best way to scale Revenue as an Airbnb business is it just about getting more Properties or is there other ways to increase Revenue yes for sure only more properties under management but the most important thing is to increase the profitability per property which means increase revenue and reduce cost and say we'll talk about the four things that we do to do that right yeah so to maximize your revenue and reduce the cost I think there's 40 things we want to do the number one really really critical thing is to always always provide a great customer experience which will tend to come into your reviews that show up on Airbnb your verbal websites yeah and guess when they book it they will look at those reviews and they'll trust your listings more and they'll book you the second thing you want to do is you want to provide a great design as well in the houses so when people look through Airbnb or any other website and they're trying to find properties to look at your cover photo and that stands out for them and they'll click into it and they'll see that the reviews are also great and they'll book you the third thing you really want to do is you want to make sure your price optimizing your listings so when the demand is high in the case of Seattle it's summertime you price high and when the demand is low you want to price competitively so that your listings get booked out yeah and the fourth thing which I think is really uh critical but often underlooked is operations and when I speak about operations the the big things that you want to make sure is your DC cost structure the some of the ways you can reduce It Is by standardizing a lot of your equipment print that you have so instead of having multiple sets of plates dining chairs Etc across all the houses you only have one set that way it helps because you hurt reduce your inventory holding cost because if things break you don't need to buy a custom set of like CB2 plates which is six pack 50 bucks or so you can get a nice um you know a stand plate and you can use that across all the houses okay all right it's Blitz time even Sid you got 10 seconds to answer these questions can you do it absolutely all right let's go winging a DIY asks how do you find and hire trustworthy cleaners and what happens when a majority of the properties are turning on the same day you have the sap or turnover BNB you can also find them on Craigslist or indeed.com if you have multiple cleans happening the same day you wouldn't always have backup cleaners to make sure you can schedule and handle the search good job all right swampy Joe asks what would you do differently if you had to start over I think the biggest thing we would do differently is focus on density density density that really reduces the time that you have to go from different properties to clean to restock and so focusing on that would really help in reducing our time and cost great okay Fernando de la Cruz asks how did they acquire customers from the beginning until now at the beginning it's all through organic so through friends there's referrals and now it's through our website all right last question Rudy K asks what were some unforeseen challenges I think the biggest one is that this is a much more active business so if a guest tells you that their water heater isn't working one o'clock in the night or their smoke alarm is ringing 11 o'clock and if you don't have employees there I had to go by myself to fix the smoke alarm and the water heater at 11 o'clock in the night at one o'clock in the morning how many of these 22 properties you have booked yeah so almost all our properties are booked really wow yeah so typically your bookings are a function of price as you price higher your bookings start going lower so the goal which is uh the same in Airlines and hotels also operate on the same model is they're trying to maximize their revenue and which ends up being around the 77 to 80 occupancy Mark is when they can maximize revenue and is that typical that's yeah that's typical for us as well we typically be around 77 80 occupancy for the whole year several months are usually more occupancy because it's the most popular season and winter months are usually slightly lower so if you're at the 75 to 80 Mark how many bookings do people need to break even or to make the business worth it fifty percent is where the break-even point for most homeowners so and we are operating right now at 75 occupancy and the difference between the 75 and 50 is where the homeowners and the investors make their profit okay does it make sense to lower rates so that you're at 100 or you're trying to find like a sweet spot the 75 80 is The Sweet Spot actually to for for Revenue optimization so one of the biggest mistakes that um when you're starting as an Airbnb manager is you try to see warranty calendar booked out for the full year so people tend to price themselves too low and get the full calendar booked out your Revenue form usually follows an inverse U-shaped curve which as you go increase prices your occupancy starts going down but your Revenue which is a function of price multiplied by occupancy goes up and it Peaks around that 75 to 80 occupancy so word of advice if you are trying to run an Airbnb management business you do not want to see yourselves fully booked out for months at an end you're probably you're pricing yourself too low and you're like a math wizard with this that's amazing talk me through the process of identifying an investment property until it actually generates Revenue what are those steps and how long does that take right yeah so there's two sorts of clients who typically get one is who purchases with us so we help them buying them house and then the second one is who you know wants to just us to manage the house whatever house they have so typically it takes us anywhere between three to four months we work with the client to Define their budget once we do find the right investment we think is going to regenerate good returns and long-term stability of cash flow and appreciation will help make an offer on that house to get the client after closing it takes only usually two weeks or so from closing to setting up the house if we don't have to do any major Renovations or so for the homeowners now that we are trying to manage the property we'll actually help them set up the house we have special criteria that we want for the design of the home for what amenities to have and we want to keep it as standard as possible and so we will be involved in that design consultation with them so you will see all the furniture all the amenities all the appliances are pretty standard across all our houses and our staff will purchase it our staff will assemble it will Mount the furniture and after that we fully manage it and you know we we handle everything after that on the other side what is a sign that a property investor is a good person to take on the management of their property so the quality we're looking for is the willingness for the owner to invest up front as you can see in our homes we feature high quality amenities standardized Furnitures really nice decorations we operate in a higher Revenue tier of the Airbnb Market do you do any type of screening on them and what are the key points that matter most we typically provide them a court on how much it's going to take to bring it to our standard so that we can provide a standardized service and great guest experience and a lot of the owners who are not willing to invest or self-select themselves out and only the investors who believe in our vision will be the ones willing to invest with us only like 20 to 30 percent of the people who contact us you know want to invest in that Vision most of them just want to basically use their house as is and just make them some money which doesn't really align with our philosophy so we we have to reject them what's the best way to keep guests happy in a rental property the the biggest thing that um I think you want to be careful of especially when you're running an Airbnb is more than half of our guests even now who are coming to airbnbs it's actually their first time using airbnbs so the the biggest experience they've had so far when they go travel is a hotel so you want to be mimicking as much of an experience as a hotel as possible so when you go to a hotel for example you see white sheets garment sheets for example you see white dowels cotton towels there as well blackout curtains and everything we want to do is try to mimic as much as possible off that hotel experience so basically try to provide that hotel in-home experience yeah plus a kitchen yeah I can really feel that here and even the smell of it it's almost like that hotel smells have you ever had to evict a guests or do you just meet their needs and demands no matter what we unfortunately have to evict uh guests twice and that's because of due to parties so we called up Airbnb and cancel their booking for actually the guests were very Cooperative they apologized for it and after that incident we implemented our two-night state minimum we had larger homes so we want to make sure there's no one just coming book us for one night and throw a big party we also have security camera on the external of the house so that we can monitor the noise guess Behavior which has been great for us how much do you spend on marketing an average month so to acquire customers we have two sorts of customers we have customers or guests who come visit our houses and we also have property investors who we manage houses for basically Airbnb and other booking platforms such as verbalbooking.com give us all the volume of customers and there's such great marketplaces you typically do end up spending 15 off commission to them of the revenue that you make but it's completely worth it given you know they're finding declines for you they're giving you insurance and all the other things the benefits that are Airbnb provides Airbnb is a business of trust and so people will trust you more when they see higher ratings and better reviews and they'll book you more often and you can get a higher revenue and higher occupancy yeah and our homes are more than 4.9 rating out of the five so so that really helps us put us in the top spot when people search in Seattle they want to book a house which you know they know looks clean the photos look great and the ratings are also great are there special requirements for your spaces like in the bathrooms we saw standing showers or extra Commodities in the bathrooms like does that help the property get rented out more yeah I think it really depends um for some property switches such as like this one this hosts 14 people so a lot of the guests are looking for is their dining table that can actually fit 14 people and a living space that can also accommodate this whereas in some other houses such as our houses in Florida we typically host a lot of families so they really want a high chair for the baby and the pack and play for the baby as well so it really depends what your Target customers are and uh you know and what amenities they require okay what is one thing you do differently than other Airbnb managers or investors and how has that helped you grow in your business right I think one of the biggest things that I have not found anyone in Seattle or even Beyond do is focus on prevent the maintenance so as part of our operating procedure we do a monthly check of monthly restocking quarterly you maintenance and an annual maintenance as well this preventive maintenance includes caulking or sinks spraying WD-40 to oil our door so they're not creaking you know waterproofing our furniture all this really really helps in making sure we don't see a lot more reactive maintenance and putting this more on the preventive side and that really helps in you know keeping our properties in great condition and always providing fives to experience to our guests and I think that the reason we do that is we are investors we're homeowners ourselves so we know we wanted to have a high standard to maintain our homes so we want to also extend that service into the property management side and provide them with the same service this does actually include a spot for management fees as well to make sure our all our homes are in great condition you just always do that so Sid before you were saying that it takes three skills to be successful in this business and other businesses even so can you go into what those three skills are and how to get them yeah so there's um the three skills I think are one is um sales skills you really wonder when you're running a business you want to be able to sell to largest clients you're also trying to sell to investors if you have a fundraising I'd assault employees you're selling them your vision so that's really critical the second thing that you need is business skills which includes you need to know what your unit margins are which is cost of goods sold what your cost of acquisition for a customer is what do you like them value for a customer is so understanding all of that will really help you understand if your business is going to be successful from the get-go itself the third thing that you really need is being able to manage learn how to manage people manage assets well and so that is a skill that matters Eagle skill that you would want to pick up as well and how would somebody develop these skills yeah so in terms of the first skill sales skill you know there's a couple of ways you can learn and pick up the skill first as you you can learn read books on the topic one of the classic ones is how to win friends Influence People by Dale Carnegie for the second skill which is uh you know learning about the business there's a few books on this as well which is zero to one by Peter Thiel what you really need to learn from this is understanding how to read a profit loss statement how to understand how do you Market to customers how do you acquire customers and so there's tons of resources on the internet on this topic as well the third one is honestly the hardest skill because this requires managing people is an acquired skill we were fortunate enough career to you know um when you're working full-time jobs to learn and pick it up matter by magic people by ourselves but even now we're still learning and improving on how to manage people how to coach them how to motivate them and even now that's um you know that's a lifelong learning even for us and we learn every single day on how to manage people better I gotta say this is my favorite room I love what you've done here you got the the wood up above the bed the the sliding glass door to the outside all this and natural light this is like the money shot as you described right for your properties tell us about the employees that you have how many do you have and what roles do they fulfill yeah so we have we had 25 to 30 employees and contractors so among those we have cleaners that's about 20 of them we have contractors that who come and take care of the home when there's problems and of course property managers who will restock the home decorate the home and do all this stuff related to Property Management most people seem to have issues with finding employees and people for their team so how do you guys go about doing that and retaining them finding the right people is definitely the hardest part of running a business what we end up typically doing is we really focus heavily on in doing the right people and we pay them above Market grades so that we can entertain them and then we can keep them happy and then we do two more things which I think are different from most most companies first is we actually try to align our business incentives so our staff such as the cleaners under property managers actually get a bonus every time we get a five star review and the second thing we try to do is we try to help them grow in their career whether it be with us or without us whether it be part firstly or professionally so for one of her staff they actually wanted to buy a house so we ended up helping in the down payment and helping them buy the house and that's really kept most of her staff with us because you know we're in with them for the long term where does the brand name nicasa come from and do you find that it makes a difference with clients on the Airbnb side and the property management side yeah means you in Chinese and also means second in Japanese and Casa means house so nikasa means second home second house this is kind of our philosophy we want this property management business to provide the experience like a second home for the guests and then in terms of branding we as we are growing the business we definitely find The Branding to be very important because once people stay in one home they want the consistent experience and then once they see that we have more than 20 homes in Seattle when they come back they wanted to try a different home next time and that that provides a great experience and sometimes when our houses are also booked out guests will ask us hey I really like your house this house for example but because this is you know unfortunately this is booked out do you have any other homes available for these dates and they ended up booking one of our different homes as well what is your leadership style and what does it take to be a good leader in this type of business our leadership style is to give our employees as much autonomy as possible while making sure that both us and our employees are striving towards the same goal of giving a five-star experience to our guests but if there's a mistake something you know sometimes stuff does happen and people make mistakes we want to spend that time on coaching it and devising new mechanisms to make sure that doesn't happen again so downstairs you'll see we have a cleaning checklist which are common mistakes that cleaners usually make we put that mechanism in to make sure the cleaners don't make the same mistake again and so we put that you know Checker into the meds you know make sure there's no hair on the sheets yeah we also spend um some time coaching your employees every week so every Friday we spend lunch with our employees to make sure we you know we understand their goals every Friday for the last few years yeah we've been trying to do it every Friday with our boys and we also try to have Team events as well every quarter every year so and we also pay them above Market the there's no reason for them to leave us they'll obviously want to stay with us and we also want to do that as well running a business on the side can be challenging but it can also bring great returns if you want to learn how to start a business with as little as fifty dollars down that makes a hundred sixty thousand dollars per month in passive income go watch episode 56 of our upload podcast where we interview Graham Cochran how many hours do you work a week and what do you usually devote that time to yeah so both of us actually have full-time jobs so at the beginning it was really hard we were probably working 24 7. daytime work and then night time was Airbnb and then weekend as well but we that's why we decided to hire employees you know we train them and help us to run the business and and right now we are spending more time on you know of course training employees communicating with cleaners and then spending time to acquire customers so we typically end up spending anywhere between four to five hours a week or so in making sure our manage our employees are manageable and we're spending the right time on coaching them and on developing them that's where our biggest time spent at the second biggest time spent bucket is with investor relations investors reach out to us and client business department that's where our second biggest time spent all right we got the laptop pulled up here now is this where you do most of your work since it's all remote yeah um so we have a property management software that we use it's called hospitable there's others in the market such as guesty or hostfully we use the software card hospitable hair so here you can see our inbox which basically has all the centralized messages it combines the messages from different platforms such as Airbnb VRBO or booking.com and you can see what check-ins we're having what checkouts we're having you can also then go to the properties portion in which you can see all our properties and then if you click into any of our properties you can see our operations each properties calendar you can see the pricing and you can see everything else here as well and see tell hey how booked we are and how unbooked we are as well then if you go to this section called guest experience they're here you can automate all as much as your messaging as possible such as check-in instructions checkout instructions if you want to ask for how they're feeling after the first morning if they like the home or if there's anything that needs to be changed you can add all of those information here and ask them automatically then this is a really critical one is operations you want to make sure you can automate like the cleaning task creation so Hospital helps in creating cleaning schedules by itself as soon as the guest checks out 15 minutes after that the cleaners will come in and start cleaning the house and you can have different teammates teammates as different sets of cleaners and who will basically automatically be uh you know assigned to different tasks very cool and then you can have an owner's portal as well and through the metrics you can look at the metrics of each house pull the data that you want for finances taxes or anything else and the owners can also have their own portal they can log into it and see what their uh you know how how booked they are what is the revenue they're making and if there's anything else they can check that as well there so before you were mentioning that you found your first clients by ranking on Google so can you walk us through the steps of how can somebody get their business seen in the search engine right so we spend zero dollars done with this month right now because we're not high on Google so if you search go to see our little Airbnb Property Management you'll find us on Google search the way we ended up doing this was first thing you always always want to have is an online presence which means you want to make sure you have a website second thing you want to have is a Google Maps you know a business page as well and thirdly you want to have a Yelp business page as well once you get all those set up then you want to start working and optimizing that and the way you do it's called search engine and optimization you want to make sure all the Search terms are focused on the target audience that you have so for us it is specifically Seattle Airbnb property management or Seattle vacation rental property management so when we set up our website we have a Blog system we have a Content management system that's what it's called technically um to have people you know rag high on Google search so people when they search for these stubs they'll actually find us on Google search okay is that something that people are able to do themselves or do they need a company to set that SEO for them yeah so you can actually do SEO really for for really cheap prices as well there's websites such as Fiverr or upload in which you can hire Freelancers who can even do SEO for ten dollars or twenty dollars or so yeah that's really cheap and so you can you could get that done what is one myth that people believe about the Airbnb business uh and what's the reality I think one big thing is that you know you're not in the business of renting you're in the business of really providing a great customer experience so if you don't like customer service this may not be the right thing for you the other thing people think is that hey it's easy money and you know if you just put your home on Airbnb and you just message people they'll be done ends that's not really the case there's a lot of active work in world you know costly checking your properties and you know you may be an on-call if there's an issue that happens you have to go and fix that issue as well if you do really well and if you you know work hard there's risk but you can also make good money if you perform well as well and that's a wrap I hope you enjoyed this episode before you go make sure to check out our other interview with Todd Baldwin of Baldwin Capital who took his Airbnb and Rental Investments and turned it into a two million dollar per year rental business hope to see on the next episode foreign [Music]

Channel: UpFlip

Views: 636,465

Keywords: airbnb, airbnb business, airbnb hosting for beginners, airbnb tips, how to start an airbnb business, airbnb host, how to airbnb, airbnb tour, airbnb hosting tips, airbnb arbitrage, air bnb, airbnb listing tips, how to airbnb your house, airbnb set up tips, airbnb pricing strategy, best airbnb, airbnb design, entrepreneur, entrepreneurship, business, upflip

Id: 6m-MosXlpOE

Length: 40min 26sec (2426 seconds)

Published: Wed May 03 2023