For young aspiring entrepreneurs at the drawing table trying to discover what you’re passionate about, you will most likely agree that being your own boss, making your own hours, setting your own rules, and living on “easy street” is the primary objective. But the fact of the matter is, running a startup is more than being your own boss, the hours you will work will be insane, the industry you choose makes the rules, and there is nothing easy about it.
And if you thought that launching a trendy startup had to involve some life-changing product, you may as well scratch that off the whiteboard as well while you’re at it. By definition, a startup is simply a young business that is just now getting its proverbial feet off the ground. There is no set of rules saying you have to invent the next hottest trend in tech to be a startup; there is no magic number of partners needed; it’s innovating an existing idea and making it better.
Adora Cheung, co-founder and CEO of Homejoy, said in an interview with Forbes that “Startup is a state of mind.” She should know. Homejoy was named one of the Hottest U.S. Startups of 2013.
The Idea Behind Airbnb.
In 2007, two financially strapped friends, Joe Gebbia and Brian Chesky, decided to rent out rooms in their apartment to designers visiting San Francisco for the International Design Conference after all the hotel rooms in the area were booked up. As is the case for many startups, Gebbia and Chesky never intended on it becoming the successful business it is today; they only wanted to earn some extra needed cash to pay their rent.
The two soon found that it was pretty profitable and they began sharing their idea with other people who rented apartments. Gebbia and Brian called their small business endeavour “Air Bed and Breakfast,” with the word “air” signifying the air mattresses offered to guests to sleep on. And though the accommodations seemed less than appealing compared to a comfy hotel room, guests absolutely admired the two for their great food and wonderful San Fran tours they provided.
The rest is history. Today, we know it by the name “Airbnb,” a global company that operates as one of the world’s largest online marketplace and hospitality service. It can be accessed via the Internet or mobile application. Working similarly to Uber, anyone who feels their house or apartment is nice enough can post available rental space on the Airbnb website and mobile application, naming their own price, while Airbnb providing potential guests with the recommendations.
The company has a secondary £600,000 insurance policy to cover any damages done to homeowners’ or apartment renters’ property. It’s common for many homeowners, in particular, to take out second mortgages on their homes in order to renovate their house specifically to get into the Airbnb business.
What If You Don’t Own a Home?
Some if not many of the readers may not yet own their own home, and a lot of times apartments have strict rules about renting to people that are not listed on the renter’s lease. What makes this business venture such a beautiful idea for young people is the possibility of hitting two targets with one stone (we won’t use “birds” since that is nice): if you purchase a property with the sole intention of becoming a professional Airbnb host, you will also be purchasing yourself a home. That’s if you’re comfortable living under the same roof with complete strangers on a continual basis.
If your credit is up to par, you have an okay paying job, and you’re willing to apply for a mortgage, starting your very own bed-and-breakfast shouldn’t be too difficult. And the awesome thing about hosting for Airbnb is that the company will do the marketing, provide the website and mobile application platforms, and cover you with its insurance (though it’s advisable to get your own insurance as well).
What Should Your First Step Be?
You’re in a perfect position to do things just right. And being that you entered purchasing a home with the intention of making a profit, you should be willing to invest in a nice property in an area where having guests coming and going doesn’t bother people in the neighbourhood. This means you have to think strategically when searching for the location.
As for the mortgage, calculate based on your earnings how big of a mortgage you can afford, as well as factoring in possible loans, grants, and help from friends and family. Remember that, as an investment, the nicer your home and the quality of furnishings you provide will dictate how much you can charge guests for rent. It goes without saying that the nicer it is the more you can charge.
What Kind of Host Should You Be?
As an Airbnb host, you can fashion your place and services however you wish.
How Do You Get Paid?
Furthermore, as stated above, you can charge your guests any amount you please. Airbnb takes only 3 per cent from your rents. Within 24 hours, Airbnb will release your money to you. For new hosts, there is a 30-day waiting period before the host can cash out. The following payment options are available for hosts:
- Direct deposits, which normally take up to three business days
- International wires or bank-to-bank transfers, which normally take three to seven business days
- PayPal, which is usually no longer than a day
- Western Union, also no longer than a day
- Payoneer debit card, one business day as well
What Areas in the UK Are Best to Be an Airbnb Host?
Not every location is suitable for running an Airbnb. You should think about hosting for tourists, honeymooners, conventions, and other things that fall around those same categories. According to Airbnb, cities such as Glasgow, Edinburgh, Cardiff, Liverpool, and Manchester are leading markets. Then there is the Lake District, Cornwall, Bristol, Canterbury in Kent, as well as other popular places in the United Kingdom.
