Cleaning Toilets and Keeping Keys: How This Startup Profits Big from Airbnb

While working at a law firm in Madrid and traveling to see his long-distance girlfriend, Brandon McKenzie hosted on Airbnb to help pay down law school debt, but he noticed it was challenging to communicate with guests while he was traveling himself.

“If I were on a plane or in another country without a SIM card, phone service, or access to WiFi, I wouldn’t have any assurance that my guests had gotten in safe and sound,” he says. “I also would not be able to confirm bookings, and people on Airbnb often make decisions quickly and message multiple hosts when looking for a place to stay. That means there were definitely missed opportunities.”

McKenzie met Matt Lerner through a mutual friend, and they both noticed they had a lot of friends who worked as consultants and traveled often. “They’d say, ‘I can’t believe how much I’m spending on my apartment, and I’m only there 12 days a month,’” Lerner recalls. “Most of our friends were so busy they couldn’t take on the full-time management [of an Airbnb].”

About a year and a half ago, McKenzie and Lerner teamed up to launch a startup called MetroButler. Their company currently serves Airbnb hosts in New York City plus a few tester markets.

MetroButler will clean rentals between guests, screen guests and provide 24/7 guest support, including handing off keys. It will also create a rental profile that includes professional photos and optimized pricing so that hosts can maximize their rental bookings and income.

“We operate on a commission structure, so we succeed when our hosts succeed,” McKenzie explains. “Occupancy is important, but if you price for over-occupancy, you’re leaving money on the table.”

MetroButler uses dynamic pricing to find that sweet spot where hosts can maximize earnings.

“For example, if you had a home open for 30 nights that might fetch $300/night, booking out 50% of those nights, you’d make $4,500,” McKenzie explains. “If, however, you were to drop the price to $280 and could book out all 30 nights, you’d make $8400. Our algorithm is constantly updating to optimize each night’s price, and, as an added benefit, that constant updating gives our hosts an SEO bump within Airbnb.”

Getting Started

For the first few months, Lerner and McKenzie did everything from filing incorporation documents to cleaning toilets and dropping off keys.

Their startup costs were a few hundred dollars on filing incorporation documents and setting up a website on SquareSpace. “We were doing everything ourselves out of a Starbucks,” Lerner says. “But we believed in the product and what we were building.” However, charging 25% commission for bookings meant they started generating revenue immediately and made back that initial money within their first few reservations.

MetroButler’s early customers were the cofounders’ friends, who then started telling their neighbors and coworkers about it.

“The first few months of the business were focussed on building our tech platform, making our first few hires, and building out our operational efficiencies for the business,” Lerner says. “When we began, we only had about a dozen properties so we made sure to build the foundational processes that we would be able to follow as we scaled up to manage hundreds of homes.”

Lerner says MetroButler allows people to earn passive income without many of the hassles hosts often face.

“I think for most people they see the value in gaining passive income off one of their assets which is their home, but at the end of the day time is limited,” Lerner says. “If you’re on a plane going 14 hours away for a vacation and something happens at your house, you can’t address that problem. With MetroButler, they can hire us.”

That approach seems to be working: 90 percent of hosts return to MetroButler for a second booking, and MetroButler averages 10 bookings per host.

Staying Relevant

MetroButler has evolved to offer a lite version that allows hosts to test out services like cleanings or key exchanges on an a la carte basis.

Lerner says the lite version serves as a lead generation tool to convert hosts to the full service. Annual revenue growth year over year has been 362 percent, and annual growth of reservation bookings year over year has been 489 percent.

Other startups provide similar services to vacation rental hosts, but Lerner says one of the ways MetroButler differentiates itself is through its online user dashboard. “We built a calendar that shows you stats, occupancy rates, how much money you’ve earned and connect to the back end [of] Airbnb,” he explains.

McKenzie and Lerner’s Advice for Young Entrepreneurs

Here’s their advice to other entrepreneurs.

Prove out your idea. “I’ve seen so many people say ‘I don’t like my boss, I think I’m an entrepreneur,’” Lerner cautions. “And then they try to figure out what their idea should be. An entrepreneur is somebody who has a great idea, knows people want it and goes out to build it.”

Tune into people’s needs. Lerner says the best way to find a solid business idea is to pay attention to what people need and can’t already get. “When people need something they’re typically willing to pay for it,” he explains. “It could be in food services, operations, tech, human resources, advertising …”

Document everything! In order to scale up your business and delegate tasks to others, you need documented processes. “The difference between a good idea and functioning business is process development, validated learning, and the ability for others to pick up where you left off,” McKenzie says. “If you can retrace your own steps, you’ll have an easier time replicating success.”

With services like MetroButler, hosts can rest easy that they’ll never get another 3 a.m. phone call about a clogged toilet or wait hours in the rain to hand off keys to a late guest.

Susan Johnston Taylor (@UrbanMuseWriter) is a freelance writer who’s contributed business and personal finance stories to The Atlantic, The Boston Globe, Entrepreneur, Fast Company and U.S. News & World Report online. She lives in Austin, Texas and gets her frugal Yankee habits from her mother’s side of the family.