For homeowners offering their property for short-term lets on Airbnb, Hostmaker helps them turn a home into a hotel through its hospitality management service. Now the start-up's founder Nakul Sharma has his eyes on the premium market after partnering with Marriott Hotels, he tells Sam Forsdick
Hostmaker says it will help turn a home into a hotel through its hospitality management service
The start-up is one of the biggest management service providers for Airbnb and helps property owners look after cleaning, maintenance and advertising
Founder Nakul Sharma hopes to help the Silicon Valley giant implement its upcoming Airbnb Plus premium service after launching a new partnership with Marriott Hotels to offer more luxury stays
For Nakul Sharma, the founder of Airbnb management start-up Hostmaker, the key to any successful hotel is hospitality.
The trend of homeowners letting out their property while they go travelling or opening up a second home for holidaymakers has rapidly expanded as companies such as Airbnb make the process of advertising a let simple and mostly hassle-free.
But Nakul noticed something was missing with the service being provided – and Hostmaker aims to help property owners bring the perks of staying in a hotel, such as the quality of accommodation and service, with all the benefits of being in a home.
His company’s role is in managing the property, cleaning, getting the best photography and making sure it is advertised at the right price.
Nakul says: “When tenants come to stay, we are providing the same quality of linen that’s available in four or five-star hotels, we put a welcome pack in the home that has goodies from the city they’re in and we are available 24/7 for any property maintenance issues.
“This makes it as close to the hotel experience as you can get in the home.”
When Hostmaker started to turn a home into a hotel
The idea for Hostmaker came to Nakul in 2012 when he began noticing the growing trend of using homes as an alternative to hotels.
Nakul says: “Almost a billion dollars went into platforms like Airbnb and One Fine Stay.
“For most people, paying someone to stay in their home was still a new concept but it got me curious why so much money was going into that space – and from a hotel perspective I started to think how this could impact the industry.”
Although initially the attraction of Airbnb was its low price compared to hotels, the brand quickly developed and is now bigger than the world’s top five hotel chains combined.
With more than 150 million users and a valuation of $31bn (£23.73m), the home-letting company has undergone rapid growth and total market dominance.
For Nakul, it’s easy to see why. He says: “More than 80% of people who stay in hotels are business travellers who stay for less than two nights – they are looking for efficiency – but for those after a more experiential travelling experience, the home is a better product.”
In comparison, 20% of the people who use Hostmaker stay for longer than 30 days.
Nakul explains that many people staying in one of the properties it manages are business travellers who may need to stay in a different city for a couple of months or people who are relocating to a new city and need a temporary place to stay while they look for something more long-term.
His own background of training at hotel school in Ireland, which he graduated from in 2015, has informed his view of the business and placed an added importance on hospitality.
“Hospitality is core to the business and that comes from my own background,” Nakul says.
“I used to work for international hotel companies like InterContinental and I saw there was an opportunity to improve the experience of the property owner.
“It is generally a very passive relationship but because we come from a hospitality mind-set, we want to make sure that we are looking after both the tenant and the owners’ property.”
The importance of “welcome wizards”
Through Hostmaker’s pricing algorithms and analysis Nakul claims that property owners who advertise with the service can improve the valuation of their homes by up to 30%.
The attention to detail Nakul takes a lot of pride in all stems from the front-of-house staff.
He explains: “We call our concierge team ‘welcome wizards’ and the objective is not just to deliver keys but to welcome them into the home and create some magic by connecting the tenants and the guests to the neighbourhood, and make them feel comfortable.
“It’s really part of our DNA to be thinking about hospitality.”
For Nakul, the cleaners and the concierges are the most important parts of the business.
“Starting my own hospitality business it was really important for me to look after our front line team members – not just in terms of paying them a better wage but also treating them as an extension of our office and technology teams.”
How technology has changed the travel industry
He believes technology has fundamentally changed the way we travel and the hotel industry must adapt to meet that.
“Before, if you didn’t know the language, the concierge would be your port of call to give you advice, as well as book hotels and restaurants,” he says.
“Now it can all be done via a smartphone so it has made travellers more adventurous.
“You go to a new city and can use Google Maps for directions, Uber for travel, room service through Deliveroo and restaurant bookings through their apps.
“It’s made us more independent and more confident to venture beyond the hotel space.”
Hostmaker partners with Marriott Hotels as it aims to turn a home into a hotel in premium market
Hostmaker now has 250 permanent staff and a further 100 freelancers managing 2,000 homes across three European markets, and Bangkok.
Managing the success of his home management company has been the most challenging aspect for Nakul.
“Building a business becomes possible at a much faster rate through investor funding but one has to be conscious of managing costs and building a sustainable business for the long term,” he says.
“It’s not about quickly adding customers and then selling the business off, it’s a very tricky balance.”
Nakul hopes its new partnership with Marriott Hotels will allow his company to develop the premium aspects of its service.
He adds: “Marriott brings the strength of its brand and we bring the expertise for distributing across the city.”
When looking across at the rapid growth of Airbnb and the soon-to-be-launched Airbnb Plus – which offers a more premium service by hand-selecting the best Airbnb stays and hosts – Nakul doesn’t see a competitor but instead sees an opportunity.
“At the end of the day, Airbnb is just a website and it doesn’t have people on the ground ensuring the quality is maintained over time.
“We are considering how we can be a partner to Airbnb and help it with implementing Airbnb Plus.”
Further down the line, Nakul is looking at the potential of expanding into the Middle East – as Hostmaker continues to grow and blur the lines between home stay and hotel.