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Starting an Airbnb Business

The concept of renting out space through Airbnb is relatively straightforward, but setting yourself up for success requires a little more work.

We don’t think that creating an Airbnb business needs to be daunting, and we’re here to help. We’ve supported over 1,000,000 people to form a business and provided answers, guidance and support to transform them into entrepreneurs. We’ll guide you through what you need to know to start your Airbnb venture and get it off the ground.

Airbnb Business formation guide

From validating your business and doing the research to filing your paperwork and running your business, this guide will help you out. Read on for some insight into creating your own Airbnb business and becoming an entrepreneur. In this guide we will cover:

Statistics on why you should start an Airbnb business

Choose the right business structure for your Airbnb company

How to find out if an Airbnb business is right for you

Setting up your Airbnb business including location, equipment, employees, taxes, finances, licenses and more

Ideas for the type of Airbnb business that you could form

Where to find Airbnb business groups, forums and support

Proving your Airbnb business can work

Useful online tools for Airbnb business owners

Business plans for Airbnb companies

Why You Should Start a New Airbnb Business

Airbnb has made it easier than ever for people to become hosts—people that rent out property for others to stay at. Airbnb is a ready-made marketplace for guests, with millions of listings around the world. Here are some statistics on the power of the Airbnb industry:


There are over 150 million users on Airbnb


The largest market for Airbnb is in the US, with an economic impact of $34 billion


There have been more than 500 million stays through Airbnb

Increase in U.S. bookings year-to-year

Half of Airbnb users stay in an Airbnb instead of a hotel

More than two million people stay at an Airbnb on any given day

Almost nine in ten reservations are for two or more people

The compound growth rate since 2009 has been over 150 percent a year

There has been a 45 percent increase in U.S. bookings year-to-year

This is why Airbnb businesses are so exciting — how can you be a part of that success? We're here to help you figure that out.

Want to start an Airbnb business? Incorporate with us, today.

Is Running an Airbnb Right for You?

Before deciding to start an Airbnb business, it’s important to understand the skills and approach you’re likely to need.

A Day in the Life of an Airbnb Host

Here are some of the typical tasks you’ll be performing for your Airbnb business on a daily basis.


Answering questions from guests and providing useful information


Arranging for cleaning and other routine tasks at your properties


Taking care of repairs and maintenance


Ensuring that bookings are up-to-date


Getting information and photos to create compelling Airbnb listings


Uploading and managing listings on the Airbnb platform


Minimizing cancellations of planned visits


Setting prices for guests to stay in your property


Responding to reviews from guests

Skills Needed by an Airbnb Business Entrepreneur

The following skills will be very useful in your role as an Airbnb small business owner.

Organizational skills to stay on top of your enquiries and bookings

Interpersonal skills for managing the people that provide cleaning, maitenance and other services at your properties

Planning skills to offer the amenities, supplies and services that your guests want

Financial management skills so you understand the money you’re earning from rentals

What Your Airbnb Guests are Looking For

Airbnb customers, commonly known as guests, are looking for:

Properties that match the listings provided by the host

Properties that are safe, clean, and well-located for their needs

Properties that are priced appropriately for their location, demand and the time of year

Common amenities including clean sheets, toiletries, a first aid kit, etc.

Easy access to the property

Important information like contact details, good local restaurants, transit stops, emergency service numbers, etc.

Creating a Unique Airbnb Business

When it comes to starting an Airbnb business, you want to make sure that your property and listings are unique, so you can attract customers. You can do this by highlighting certain aspects in your listings:

Get a professional to photograph your property, so it’s portrayed in the best way

Invest in making your property look good, with a fresh coat of paint, new furniture and a deep clean

Highlight anything unique about the property, like original features or unusual facilities

Show how close you are to public transport, local points of interest and restaurants

Maintain a listing that gets good reviews from guests and builds trust

Validating Your Airbnb Business

Getting started in an Airbnb business is easy, but becoming a success is harder. Before committing too much time, energy and money into your new Airbnb business, it’s important to test the marketplace.

Identify your Airbnb business’s unique selling points (USPs)

We’ve covered some key points on how to differentiate your listings above, but it’s important to reiterate: If you want your Airbnb business to be a success, you do need to stand out.

Look at who your competitors are in the space

Having competitors is a good thing as it shows there’s a market, but you want to avoid too much competition. Look at how many other hosts are providing accommodation close to your location, and see how they position their listings and prices.

Understand your market

You might want to target your listings to a particular type of guest, so if you know there’s a market, make sure your accommodation reflects what might be of value to them. For example, younger people might want vibrant nightlife and a very modern place to stay, while older people could want more peace and quiet, with natural outside space.

Get involved with business communities and discussion groups

One of the great things about Airbnb business is that there are plenty of great communities and discussion groups. Get involved in them and learn the ins and outs of your chosen market before committing.

Your Airbnb Business Needs a Business Plan

You might not think you need a business plan for your Airbnb business—after all, if you’re getting guests through Airbnb, and they’re paying, you don’t need a business plan, right? Wrong.

Why You Need a Business Plan?

You need to define how you’re going to run your Airbnb business, market your property, get sales, make a profit and grow. This can only come about through creating a watertight business plan. It will help you get your thinking in order and show your commitment to your Airbnb business.

You will also need to look at financial projections for your Airbnb business. What are your expected booking revenues? How much is it costing you to buy and maintain the property? What is your profitability? How much money will you keep in the business to grow it? How much will you pay yourself and others?

Business plans do vary slightly, but they should all cover the following areas:


An executive summary with the most important points from your business plan


Your goals and what you hope to achieve with your Airbnb business


A description of your business, background information and context


A market analysis and likely demand


An overview of how your business is structured


Your business model


How you will market and sell your offerings


Financial projections, revenue and profitability



We’ve got the perfect guide to writing your business plan.

Choose the Right Business Structure for Your Airbnb Business

Choose the Right Business Structure for Your Airbnb Business

Now that you have all the background information for your Airbnb business, it’s time to make it into a reality. That starts by choosing the right structure or “legal entity” for your business. In the US, there are five main business structures. They are:

Sole Proprietorship

This is the "default" business structure and is what your Airbnb business will be if you decide not to create a more formal structure. We don't recommend this type of business as it doesn't give you the legal protections you need.


This is a type of business that is formed when two or more people work together without creating a more formal business entity. Like a sole proprietorship, it may not give you all the protections your Airbnb business may need.

Limited Liability Company or LLC

The Limited Liability Company (LLC) is ideal for most Airbnb businesses. An LLC is easy and inexpensive to setup, and has the least administrative requirements of any formal business entity.

S Corporation

This is a more complex type of business and isn't generally recommended for smaller organizations, like an Airbnb business.

C Corporation

These are the largest and most complex types of businesses and are typically far more than the average entrepreneur or Airbnb business owner will need.

For more information on the advantages and disadvantages of different types of businesses, please see our in-depth guide. If you’ve still got questions, we’ve answered them to help you choose the right business structure for your Airbnb business.

In most cases, our recommendation for your daycare business would be to create an LLC. We’ve got a complete guide to everything you need to do. LLC formation does vary from state to state, but we’ve got you covered, wherever you are.

Setting up Your Airbnb Business Operations

Once you've legally created your Airbnb business you’ll need to get some other things in place.

The Complete "Start Your Business" Checklist

A Clear and Comprehensive Guide to Starting Your Business the Right Way

The Complete

Rules, Regulations, and Licenses for Airbnbs

Even though you’re running an Airbnb business, you can’t escape real-world licenses, permits and regulations. You will need to explore local, state and federal licenses and permits, and we can also help out with researching your business licensing needs.

It’s also very important to consider local zoning laws, ordinances and permits. Some municipalities don’t allow just anyone to set themselves up as an Airbnb host, and if you do, you could be fined. Check with your local and regional authorities what their requirements are for Airbnb hosts.

Please note: This post contains affiliate links and we may receive a commission if you make a purchase using these links.

Airbnb Taxes

Taxes are a fact of life if you’re in business, and there are various ways you will need to file and pay them. This can include self-employment tax, state income tax and federal income tax. Depending on where and how you’re selling products and services, you may also be liable for sales and use tax.

As a rule of thumb, we recommend keeping back around a third of your earnings to pay your taxes. We can even prepare and file your tax returns for you

Maintaining Your Airbnb Business

There are certain forms and legalities you need to follow to keep your Airbnb business in good standing.


File an Annual Report

Most states require all businesses to file a report once a year. This report has details of any major changes to who owns a business and other major impacts on a business’s legal status. We can file your Annual Report on your behalf.

Annual Report

Pay estimated taxes

You will be expected to pay estimated taxes on what you plan to earn in the current business year. Typically, you will need to pay estimated taxes in April, June, September and January (of the following year).


Renew Business Permits and Licenses

Your business will probably have several licenses, permits and other regulations. These typically need to be renewed every year.


File your taxes

You will need to file your taxes once a year.


Pay payroll and sales taxes

If applicable, you will need to make payroll and sales tax payments on a regular basis.


Get Insured

Most Airbnb businesses should have comprehensive business insurance. There are various types.

Insurance for Your Airbnb Business

Most Airbnb businesses should have comprehensive business insurance. There are various types.

Workers Compensation Insurance

Workers’ compensation insurance provides coverage for job-related illnesses, disabilities or injuries that affect employees. Regulations for this insurance vary from state to state. It typically covers areas like medical costs, loss of earnings, compensation and retraining.

General Liability Insurance

This insurance protects your Airbnb business from claims due to being sued. This may include injury to members of the public, property damage, personal liabilities, legal defense and more. It can help protect your business from financial penalties and bankruptcy. This type of insurance is essential to your Airbnb business as you will be having people living in your properties.

Home and Auto Insurance

If you are working from home, for example on the administration of your Airbnb business or driving a vehicle for work, check whether your existing home and auto policies cover you for work use of your home or car. If not, you should either expand your policy so you’re covered or get dedicated business insurance.

Groups and Forums for Airbnb Owners

Here are some useful places where you can connect with other Airbnb entrepreneurs.

Useful Online Tools for Your Airbnb Business

The right software and apps will make it much easier to run your Airbnb business. Here are our recommendations for some of the best tools out there to make business operations a breeze.

Please note: This post contains affiliate links and we may receive a commission if you make a purchase using these links.


Are You Ready to Start an Airbnb?

If you have an extra room, or a whole property you want to rent out, Airbnb makes it easy. If you can create great listings, build positive reviews, understand your competitors and put together a solid business plan, you will have every chance for success

Start your Airbnb Business with us, today!