Airbnb Host Capital: What is it and How to Make Money out of it?
Airbnb Host Capital
Airbnb host capital is a new service that came out at the end of 2018. It’s a service where experienced hosts can qualify up to $50,000 as a loan to invest in their Airbnb business.
From my understanding, you can apply for it in two different ways. 1) Invitation only and 2) on their website. Airbnb only invited hosts that make over a 100k a year initially (I got an email from them on December 4th, 2018). BUT, don’t get discouraged if you weren’t invited because there is another way.
You can apply here. Before you apply, I’d like to cover some use cases where you can use the money to make more money. Some guy said, “It Takes Money to Make Money.”
Without further ado, let’s go!
What Is Airbnb Host Capital?
It’s a business loan to help high-revenue generating Airbnb hosts to either expand or reinvest in their existing Airbnb.
Do you want that stylish decor from West Elm? Now, there are 50,000 reasons to get it! [word of caution: don’t go high-end because there’s a good chance your guests would break it).
This is what I do instead.
One thing to note is that Airbnb isn’t going into the business loan industry. They’ve partnered with a company called Kabbage. They seem legit! The company was founded in 2009 and took in about $200 million in venture capital.
Why Airbnb Host Capital?
I mean why not just go directly to Kabbage or other financial services providers? Airbnb Host Capital was built for Airbnb hosts. Here are some benefits that you won’t find anywhere else.
- Pay only when you have a reservation
- Pay automatically: 30~50% of your reservation total will be deducted, which means you don’t need to worry about it. On the other end, you have less control because you’ll need to connect your Airbnb account + bank account(s).
- Approved quickly: It takes less than 10 minutes to find out
- Fixed interest rate: it really depends on your Airbnb revenue and credit history. I’ve seen hosts with a 3% fixed interest rate, which is kind of insanely low for a $20k+ loan. It’s almost like free money if you need it.
How Do You Make Money with Airbnb Host Capital?
I’ve alluded to the two different ways to make money with Airbnb Host Capital earlier. I teach existing Airbnb hosts to scale up their existing Airbnb business. Like our Airbnb host Michael….
Michael is able to use early payouts to his advantage. Well, since I’m already on this topic, I’ll just quickly explain what early payout is and how it works.
You’ll have to opt into early payouts and there’s a catch: Airbnb will take an additional 1 percent of the booking subtotal. But you’ll get 50% of your reservation after 3 days vs. a day after the guest checks in. In this case, that’s pretty much like Host Capital and only less intrusive.
Of course, the other way is to invest in new amenities, kitchen things, new beds, or whatever you need to refresh and update your existing unit.
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