[00:00:05] Speaker A: Welcome to the Short Term Show. The show about short term rentals and long term wealth with real property owners hosting real properties who are crushing it in the vacation and short term rental space.
And here's your host, Avery Carle.
[00:00:28] Speaker B: Hey, y'. All. Welcome back to another episode of the Short Term Show. I'm your host, Avery Carle, and today we have the co founder and CEO of Local Bird, which is a very cool company that I've just learned about here in the last few weeks. And we have their co founder and CEO Ben Levy, here to talk about what it does and how it can help you as a short term rental host. How's it going, Ben?
[00:00:49] Speaker C: Thanks for having me, Avery. I'm great. How are you?
[00:00:52] Speaker B: I'm doing awesome. Can't complain.
[00:00:55] Speaker C: Cool.
[00:00:56] Speaker B: Yeah.
[00:00:57] Speaker C: Excited.
[00:00:58] Speaker B: Yeah. Thank you so much for coming on. So let's just dive right in. So let's start by just introducing yourself to our audience. Tell us about yourself and how you got into the short term rental business.
[00:01:09] Speaker C: Yeah. So my name is Ben. I'm 30 years old. I got into the short term rental business initially as a guest turned founder, where me and my family were staying on a family vacation in Hawaii.
And we were looking for things to do and we couldn't find an easy way to book what we were looking for online.
So, you know, we were in Hawaii, it was like the peak of COVID and we wanted to rent a surfboard and we wanted to rent a car. Now those are two things that shouldn't be that hard to do in Hawaii, but we couldn't find like, way to do that on Google.
So our next logical step was to ask our host for recommendations.
And we did that. And he said, yeah, no problem, I can help you guys. And then handed us a dusty printed guidebook where he had basically like a list of things to do in the area with like, you know, 10 pages. A lot of it was handwritten. And he said that if you need help booking anything, then I'm happy to help you. Or you can talk to our guest service representative and she'll help you book whatever you need.
And we realized that there's no way that it's, you know, 2022 at the time where we can easily book an Uber, we can easily book a flight, an Airbnb, but when it comes to local services and experiences, we were basically stuck with a printed guidebook.
And we basically reached out to the host and we're trying to get, get things going, but we didn't really work.
So we decided that we were going to start the first concierge service for vacation rentals.
And that basically means us going out, finding all the local vendors and making them available and bookable for guests and giving property managers a cut of everything that their guests book. And this was, for us, a way to not only make the guest experience better, but also give hosts a new stream of revenue through commissions. We started off in Costa Rica, where my brother was living at the time, and we reached out to a couple of hosts and boutique hotels that he knew, and they gave us a shot. They were willing to kind of, you know, put us in touch with all their guests through initially QR codes on the table. And that basically grew. Now we're active all over Costa Rica, Mexico and the US and we raised over $7.4 million to date. Team based, distributed globally, and yeah, happy to dive in.
[00:04:05] Speaker A: This program has been brought to you by the Short Term Shop.
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[00:05:11] Speaker B: So you guys started in 2022. You started in Costa Rica? I want to hear about that because I feel like trying to start in another country is a lot more difficult than trying to start here in America. So I want to hear about those first few months of getting up and running abroad.
[00:05:29] Speaker C: Yeah, so I actually think that the fact that we started in Costa Rica was one of our biggest advantages because that is a market that the experiences market is fragmented in general. But if you, you know, go to Costa Rica, over 80% of the local vendors only operate in one location.
And they are very offline in their nature, where most of them aren't even using a reservation system for bookings. So they're using WhatsApp phone calls. And at the same time, guests that are traveling from the US To Costa Rica are using their phones and they're looking for an online way to book. And there's a gap where a lot of these vendors just aren't available online.
So for us, the challenge was reaching out to the Vendors getting them online and getting them bookable. And those first. Those first bookings were happening in a way that was super manual. You know, we didn't have, like, this robust platform that we have today.
So basically, a guest would book something on our website, and then I'd get a notification. I would forward that to my brother who was there physically. He would hop on his motorcycle, drive to the office of the. Of the vendor, Whether it was a tour operator or a spa or whatever it was, he would say, this is my guest. We have a reservation. Please, please acknowledge this and hand them cash. And that happened for, like, the first hundreds of reservations. Oh, my gosh. We were able to kind of build a system that could scale.
But I think what we learned from that is that when you actually do the nitty gritty work, you learn actually what kind of product you need to build to serve a market.
And it's especially true when the market is super offline and super fragmented and a lot of intrinsic inefficiencies, such as the experiences market, which has been a really hard one to tackle and make operationally efficient.
[00:07:34] Speaker B: Yeah, that sounds very inefficient. Having him run around and. And book things. That's crazy. But, I mean, you're right. You do learn the hard way. You kind of earn your stripes by doing things the hard way. And then when you're able to make them more efficient, you really appreciate it more. And even here, like here on 30A, where I live, which is a very established vacation market, it still is very fragmented. If your guests want to book things like fishing charters or jet skis or spas and things, they have to know where to even look. They have to, you know, they don't know if they're getting a full spa or just like a person in a room, you know, that's not luxury. That might be a little weird and awkward.
[00:08:15] Speaker C: So it's.
[00:08:17] Speaker B: It's fragmented everywhere. And I think that this is a really good business model of trying to bring it all together so that guests can just look in one place and book what they need to book. So is this service available everywhere for all hosts, or is it only available in certain markets right now?
[00:08:32] Speaker C: Yeah, so we actually, you know, select our markets based on a couple of factors. One is, is this market going to be worthwhile? You know, are people traveling for leisure? Are they booking activities? Because not every market is. And then we want to look at. Is there, you know, like, vacation rental density in this market?
Because when we, you know, when we commit to a market, we really Want to make sure that the supply is, is, is high quality and we want to, you know, invest in the onboarding and activation of the market.
But we're active in over a hundred locations across the U.S. and Latin America and we're constantly expanding. So if there's any property managers that aren't in our market, we are happy to partner and help them build that market. And we've done that for every market that we've opened. It's been through a partnership with a property manager that was eager to join us.
[00:09:29] Speaker B: So what would you say your top 10 densest markets are for your product so far?
[00:09:36] Speaker C: So I would say most of them have been like in either Costa Rica, Mexico or the US where specifically in the US South Florida is a really big market for us.
Arizona. So like Sedona. We also kind of St. Petersburg is a big, is a big one. Aspen, Colorado. Those are all markets that we're investing in and we're, we're seeing some good traction.
[00:10:07] Speaker B: Okay, awesome. And what markets do you plan to expand into? Do you, do you choose markets and say okay, this looks pretty high volume or do you wait for a property manager to approach you?
[00:10:18] Speaker C: We actively, you know, will, will reach out to property managers through, through our network, through conferences.
So we, we do have, you know, the demand I would say definitely Park City is one that we are very excited about that we're soon to be launching.
And yeah, there, there are some other ones on the, in the pipeline.
Yeah. But it's really, really about, you know, do we have a good partner on the ground there that's going to, that's going to, you know, help us make it happen.
[00:10:52] Speaker B: Gotcha.
So what is the cost to use this or sign up for it with, for, for a property manager or a host?
[00:11:00] Speaker C: Yeah, so we've actually build our business, you know, from day one to be a partnership led.
So we do a rev share with property managers or hosts. That way they're not paying like a monthly subscription or any type of ongoing fee. We benefit when their guests book experiences and then we will split that revenue with the host Pretty much 50. 50.
[00:11:25] Speaker B: Okay, awesome. And what types of businesses do you guys partner with on the vendor side? What do you see the most of there?
[00:11:34] Speaker C: So we're seeing a lot of land and adventure tours, water activities, private chefs. Is, is one of is. Is the highest average order value booking that we're seeing as well as yacht charters and like boat rentals as well as golf cart and kind of like motor vehicle rentals, car rentals. And we've actually really broadened our categories since we started.
So we, you know, we have over a hundred categories of experiences and services that we, that we offer. Obviously it depends on the market, right? So in certain markets golf carts are going to be the thing. In other markets it's going to be about ski equipment rentals.
And usually we'll kind of learn what are the real money makers in each market and focus on that.
[00:12:30] Speaker B: All right, so if a host wants to sign up for this, so how, how do they, you, they are able to monetize off of commissions like you said. So you split 50, 50. The is it a booking fee or how's, how does, how's that presented I guess to the actual guest who's booking?
[00:12:47] Speaker C: Yeah. So after a guest books their stay, then we plug into the post booking messages and what's interesting about it is that we've actually seen that around 70, 74% of experience and services bookings actually happen pre arrival.
So there's so much opportunity that where guests are actually booking their, you know, all their add ons before they even show up to the property. So if you can reach them in that window before they check in, then you're capturing, you know, a large share of their wallet that they would otherwise spend through a third party or after they, you know, arrive and try to figure things out themselves.
But as a host there's, you know, there's the opportunity to be proactive about, about these extras that actually make their stay. We believe that, you know, hospitality is more than just providing a place to stay, but it's providing, you know, the full experience for the guests and being the go to for everything that they need, not just the bed and the sheets.
[00:13:58] Speaker B: Yeah, totally, totally agree with that. Hospitality is so much more than just a place to sleep at night. So how does this integrate with a host platform? So is it a link that they send out or do you plug into their property management software? How does that work?
[00:14:15] Speaker C: So there's, there's both options. One is the one they have a link where they can share, you know, however they want through every channel. But the other is through an integration. We're embedded with all the leading property management softwares. And then that way every guest that books their stay with you will automatically book be getting personalized offers that are well timed and relevant to their actual stay.
So we're not just like spamming people with random stuff. The things that you are presenting to them with localbird are the things that they are likely to appreciate and book during their stay. And we have Years and thousands of reservations worth of data to know what guests actually care about, what they book and what they ignore.
[00:15:09] Speaker B: Yeah, that makes a lot of sense. So what does it look like when say a guest books my place and I'm hooked up with you guys through my property management software? Is it a message that comes through and just says, hey, do you want to book any additional services? And they click on it and then they're presented with those services that what that looks like?
[00:15:27] Speaker C: Yeah. I'll actually take it a step further and say that let's say we know that your, your res, your check in date is, let's say in a week from now, you know, we could send you a message like, hey, we're so excited that you're going to be staying with us. By the way, have you booked your airport transfer yet? If not, here's a link. And then we make it super easy for them to just go in and book and that way it makes their arrival a lot smoother.
[00:15:56] Speaker B: Okay, and then, so that one's perfectly timed of, okay, you're about to get here, you're flying in in a week or two, let's make sure you have your transportation. So what about the other types of services? Like if somebody wants to book a massage or a private chef, what does that message look like and when does that timing come through?
[00:16:15] Speaker C: Yeah, so it's, first of all, it's completely triggerable by the host. Okay. And, and really the way that we will do it is we'll offer every host basically like a landing page where their guests can actually go in and see all the options.
So from private chefs to massages, tours and activities, then they have the option to, to browse freely or they can chat with a concierge, which is basically a team that we have that we staff to make sure a guest is able to book a full itinerary, have someone to talk to. And when things change, which they always do when you're traveling, they have someone to talk to and to assist them throughout their stay, which is, which is a really important part of the travel experience and something that a concierge service needs to offer.
[00:17:14] Speaker B: Okay. So it's not just a, hey, here we are giving you an opportunity as a host to upsell some things. You actually have a person like an, a concierge at a hotel that these guests can talk to when they're trying to book things.
[00:17:27] Speaker C: Exactly. So property managers often will see us and refer to us as an extended part of their team where we're basically like the tech enabled Concierge that, you know, is interacting with their guests on behalf of, of the property manager.
[00:17:45] Speaker B: Okay, that's kind of amazing. So how many users, how many hosts would you say you have so far?
[00:17:53] Speaker C: So we have over 4,000 hosts and property managers that, that we work with and tens of thousands of properties.
[00:18:04] Speaker B: Oh, wow. And it's all over the world. So we know Costa Rica and South Florida and I think you mentioned Park City. What are the other big areas? I mean, I guess countries or big, big markets in America.
[00:18:16] Speaker C: So country wise, it's, it's mainly us, Mexico and Costa Rica. We are planning to expand into other countries early next year.
And, and yeah, that's basically, you know, where we're spread out right now.
[00:18:36] Speaker B: Okay. And is there any type of sign up fee or can host join for free? How does that work?
[00:18:42] Speaker C: Yeah, host can join for free. They basically can create an account and if we're available in their market, then they'll be able to kind of self serve on the onboarding. If not, they can book a call with us and we'll know, we'll start talking about partnership in, in their market.
[00:19:01] Speaker B: Awesome. So how do you, how does a host use you guys to scale their hospitality? So like, are we using AI to make personalized recommendations for each guest or how does that work?
[00:19:15] Speaker C: Yeah, so really what it helps them do is focus on their core business while they are not constantly dealing with the operations of, of concierge and dealing with questions like, you know, how can, can you recommend restaurants or can you recommend a massager or a private chef? Which hosts are getting hundreds of those, of those questions.
And, and yeah, Bailey helps some folks in their core business. And we've had hosts that have generated over half a million dollars in half a year just through the concierge.
[00:19:56] Speaker B: Oh, wow.
[00:19:57] Speaker C: Yeah, we're talking about like large, like property, like professional property managers. So it's not like a lot of. Yeah, yeah, one or two properties.
So. But it can be meaningful revenue if it's in the right market and if, you know, it's the right kind of tier of guests.
So we're actually seeing that the biggest opportunity in terms of revenue actually is coming from the premium tier, which shouldn't come as a surprise, but interesting to see how much of a gap there is between property that's running for $100 a night versus a property that's running for $500 a night, where, you know, guests are spending on at the premium tier, over a thousand dollars just on experience and services.
[00:20:45] Speaker B: Yeah, that's. So what would be considered, now that you, you've mentioned tiers, what would be considered a non premium service for this? Because it all kind of seems kind of premium. So what would be considered a non premium service in this instance?
[00:21:00] Speaker C: I would say like when it comes to like, for example, like transportation, you can have all different types of transportation. You can have a private transportation or you can have like a shared. So private would be more premium. Whereas shared or you know, you probably just get an Uber anyway. Yeah.
And then when it comes to, let's say like rentals, like you can either rent, you know, a catamaran or you can go on like a shared tour with other people on a boat. So it's kind of like different kind of tiers of experiences and different kind of budgets that, that we're working with and different willingness to spend. Usually people who are spending a thousand dollars or more on the night, then they will usually have a higher willingness to spend on other things.
[00:21:59] Speaker B: Okay, yeah, that makes sense. People who are spending a lot of money to go on vacation will spend more money to have more fun.
[00:22:05] Speaker C: Exactly.
[00:22:07] Speaker B: Awesome.
[00:22:07] Speaker C: So trips and stuff like that.
[00:22:10] Speaker B: Yeah, yeah. So let's. What, what have we not talked about about local bird that you think our listeners need to hear about? We've got about eight minutes left in the show, so I'll let you drive on this one.
[00:22:23] Speaker C: Yeah.
So I think what's really interesting, I know we haven't really used so much of, you know, the term AI in our conversation, which, which is cool. But I will say that there's a unique opportunity right now to be able to offer like a high end personal experience to guests without needing to actually hire staff to do that stuff. Because AI has made, just made a lot of things possible now to do at scale that wasn't previously possible. So while, you know, handling all of these guest requests has been like a nightmare until AI has made conversational conversations a lot more scalable and manageable.
Now you can offer personalized recommendation at scale, which I think is really cool.
And I think that hosts will need to also adopt this because a guest that's waiting an hour for a response when they're, you know, looking to book a massage or book a private chef, they're not going to wait an hour, they're going to, they're simultaneously looking at other options, not through you.
So if you can give them that instant response, then you're going to be the winner. I think that there, there's like a study that showed that a five minute delay in response decreases conversion by 50%. Oh wow. And then an hour later it decreases it even more.
So I think that speed, being able to answer guest requests, you know, in a really, really fast is becoming more and more important, especially in today's day and age where everyone wants things on demand and instantly.
And I think that nowadays like with more and more supply being available in the market and more competition and you know, the maturity of the short term rental market, it's become more and more important to diver, diversify your revenue streams. And I think one of the areas that are most overlooked, if not the area that is most overlooked, is private chefs, massages, tours and activities. All these add ons that can actually significantly increase your revenue if you're, if you're offering it in the right way.
And that's kind of what we're aiming to solve to make that super, super seamless and easy for, for property managers and hosts to do.
And I guess, yeah, that's you know, something that I'm excited about and I can talk about for hours. But thank you so much for having me on the show and really excited to see how it turns out.
[00:25:19] Speaker B: Yeah, yeah, thank you so much for coming on. So if our listeners want to find Local Bird, follow you, sign up, learn more, how can they do that?
[00:25:29] Speaker C: Yeah, so very simple. Localbird.com you can visit our website and you can also, you know, contact us, you can add me on LinkedIn, find me in the conferences, Any, any channel is welcome.
[00:25:45] Speaker B: All right, so guys, make sure you check out Local Bird if you want to diversify your short term rental income, not just nightly rate but you know, be, be able to upsell on products and services local to your market. And Ben, thank you so much for coming on the show.
[00:25:59] Speaker C: Thank you every for having me.
Have a great day.
[00:26:03] Speaker B: Thanks you too. And listeners, we will see you next week.
