Sustainable Strategies for Scaling your Hospitality Business

One of the biggest problems in a business journey is scaling and growing. And today's boastly podcast episode is all about scaling sustainably. That's hard for me to say. I've been practicing that five times. Scaling sustainably. We have got probably, I think, our very first ever New Zealand host. I may have got that wrong. We may have had somebody on before, but this one is going to live out in time, so this is such a good episode. John Laurie is the founder of Urban utla. He's also part of the directors of the Astra, which is based in Australasia. He is in New Zealand. He was in Auckland. We, we did some time travel magic here. I spoke late on a Wednesday evening, which was very early, his Thursday, really interesting podcast. And I feel like anybody who scaled their business, whether it's scaling from like 1 to 10 or gone from 10 to 20 or, or from him where he went from 30 to 80, you'll be able to sort of relate to the struggles that he had. First and foremost. John, thank you very much for being part of the podcast. Can you just please give a little bit of background about yourself, how you came to creating and founding Urban Butler and then just let us know a little bit more about yourself and where you are in the world, please.

Yeah, fantastic. Thanks, Mark. Hey. Yes, so the Urban Butler was born, so to speak, in 2016. I was living in Australia, moving to New Zealand and took a few months off to travel in Europe. And the thing that stood out to us, you know, we were probably staying 80% Airbnb type properties and 20% hotels. And the thing that really stuck out was the additional level of guest experience that, that we were receiving, you know, at those Airbnbs in, in Europe. And one, one night in particular really stands out. We were checking in around 10pm place in Barcelona and the, the host came to meet us there, showed us through the apartment and you know, lovely, lovely apartment right in the middle of town. And on his way out he just sort of said, look, here's Lonely Planet's list of, of recommendations and here's ours. This is where you get the best aperitivo, this is where you get the best tapas, this is where you get the best coffee. Make sure you go here, etc. Etc. You know, please contact us if you've got any, any questions or anything. And you know, at 10:00pm in, in Spain, that's dinner time. So my partner and I at the time, you know, she said, where, where should we go for dinner? And I said, well, clearly we're going to go to that tapas place downstairs that he's just recommended, know. And that was really the sort of start of that, I guess live like a local or whatever you want to call it, that sort of that personal touch that I think is really, it really resonates in what we do and is a really a great add on for guest experience.

So from 2017, end of 2017, moving into 2018, 2019, what was the growth and the trajectory like?

Yeah, so we started off with just a couple of apartments, my own one and one and a friend's. And just from there we started doing some advertising and, you know, beating the streets in terms of meeting as many real estate agents and referral type partners that we could. And by the end of 2019 we had around 65 properties.

Wow. And then from 2019, moving now into 2023, how does the business look? Obviously we've gone through so many things. Lockdown, shutdowns, covert, etc. I. How, how from those 2019 to 2023, first question is how many properties are you on now? And second question, which you can elaborate on as much as you like, like, how have you sort of changed and pivoted the business through what has been like the biggest sort of lockdown shutdown that Australasia has probably ever seen?

Yeah, yeah, that's right. Look, we are currently, we currently have 50 properties, but it's a very different looking portfolio. So beginning of 2020 when, when everything started to shut down, we did lose a lot of properties. A lot of sort of mom and dad investors that couldn't afford, you know, the cash flow fluctuations and the uncertainty. So a lot of those ended up getting, you know, long term tenants in or selling their properties. The, the reality of it is I think that at the end of 2019, early 2020, we had scaled far too quickly and you know, in a, in a hindsight, you know, weird kind of way, Covid was a really good reset for us. During, during the early part of COVID something that we hadn't had to do before was, you know, market the properties per se, you know, putting them on Airbnb and the other channels did all that for, for us. And all we needed to do was, you know, advertise to new owners and bring the properties in. And that was a real sort of wake up call for us. Our previous website was a very simple, you know, off the shelf type website that was targeting owners basically and it talked about all the services that we provided for as a, as a short term rental professional management host and that was. Yes. So like I said, that was the sort of trigger point where we decided well, we really need to have a booking site as well and we need to be advertising. We need to be, we need to be advertising to new and existing guests. And that's kind of where we got to. So we invested heavily during that first part of COVID We didn't quite realize how long it was going to go up for, as nobody did at the time. But yeah, that was an absolute game changer for us. And you know, the website is pretty predominantly now a booking channel. There is a page for hosts or owners which describes all of our, you know, all of our services, et cetera. But the, the idea being that if you're an owner and you look at the Urban Butler website, you can see how well presented the properties are and, and, and, and, and what that sort of looks like from the front end. And that's kind of it, it sort of sell.

So what powers the business? Like what, what's the tech stack that you, you have property management software like dynamic pricing. What are you using behind the scenes that help powers the Urban Butler?

Yeah, so we have Guesty which is the engine room of the, of the business as you know, property management and channel management software. We use Beyond Pricing for our dynamic pricing tool. We use Aperto for our guest app, Guest experience app. And so all of that obviously links together with, with Guesty. So it's quite, quite a seamless operation. We use noise monitors in the apartments. What else do we use? Yeah, obviously you know all the different OTAs and a few boutique ones as well that we've built APIs to, to, to connect to all that sort of stuff. So yeah, that's the, that's the main tech stack. Yeah.

And, and what does the team look like? Like the team makeup obviously. Viv yourself like how many members of staff are running like the, the operations and the day to day and the marketing now with, with Urban Butler. And how has that changed from 2019? Because it sounds like a lot has happened within the business structurally since. Since then.

Yeah, that's right. I mean casting back to 2019 when we scaled too quickly, you know, we only had three staff members then 65 properties and then we lost a staff member just before Christmas going into the summer busy period. So that was a testing time and you know we learned a lot around that. So there are five full time staff members now including myself. So myself we have an operations manager who is very experienced. She's come from another large short term rental company here in New Zealand. And underneath her are three other staff members. One is a guest experience manager, one is an owner experience manager and the other one is a marketing specialist. So that's kind of, we've kind of siloed the business into those main areas that we want to concentrate on.

Fantastic. And what would you say over the last sort of three years has been your biggest like, sort of learning lesson, so to speak? Like what's that one thing that you wish you had known like beforehand? And what, and what have you gathered from that? And taken on the other side?

Yeah, I really think it is that sort of growing sustainably, scaling sustainably. It's, you know, you've got 10 or 20 properties is a very different prospect. So when you've got 50 plus properties and in order to manage that expectation of the owners, manage the guest experience, keep the reviews up, all that stuff, you really need to be, what do we say, sort of planning to grow. So growing before we get to that stage, so making sure that we've got the staff in place and all of the requirements before we get to that point.

Scaling sustainably. I like that. That's a, that's a nice thing, scaling sustainably. It's so easy when you're growing as well, when, when you feel like you're on that roller coaster and when you go in, it's so easy just to keep saying yes to every opportunity that comes your way. And I feel like over time the trick is to say no. Say no is some is better than a yes because it can open up a really good yes sometimes. And thank you for doing this. Fast approaching 600 episodes now of the podcast. So thank you being part of that and yeah, fantastic. And thank you everybody for tuning in as always. If this is the first time that you are listening or watching this podcast, please make sure you stick around. Hit the subscribe button, hit the like button. Share it with a host that you know that would maybe enjoy this interview. And with that being said, we'll be back in a couple of days time with our next podcast. So thank you very much everybody.

Thank you, Mark, thank you. Thanks for having me.

Take care everybody. Having a blast. Going to get it on the Bruce Lee podcast. Bruce Lee, like Bruce Lee. Because it's so hard on the T is loose leaf making up those rhymes. Don't write it, just do it loosely.