Industry Spotlight: Clearbanc
Every month we like to highlight a new company in the ecosystem for short term rental managers and host. This month we're highlighting Clearbanc!
Clearbanc has launched a new financial service that is specifically designed for hosts to gain access to working capital. The program takes a holistic approach to understanding a host’s business to provide them with financing to grow their business. Roughly 85% of hosts that take a Clear Advance have shown an increase in revenue by reinvesting their advance back into their property. Here’s a breakdown of their new financial product available to all hosts!
How does the Clear Advance work?
How does repayment work?
Clearbanc works with hosts to make sure they have enough cash flow needed for day-to-day operations. That being said, Clearbanc’s repayment rates are customized to every host as based on their monthly revenues, rent/mortgage costs, cleaning fees, and other expenses. As revenues are split, a certain percentage of your future short term rental revenues will be allocated to repaying the advance and fee.
...but what happens if a guest cancels?
There are no penalties for cancellations! As there is a single fixed fee, the fee will never go up or down if a guest cancels. This means they’re in it with you - and if your bookings slow down, you repay at a slower rate with no extra cost.
What do hosts spend their capital on?
Capital is typically used to renovate existing listings, buy furniture, pay off an unexpected bill, or acquire new listings. Buying that new couch or bed is a simple investment that can take you a long way. Hosts that have renovated their properties have, on average, been able to charge 15% more per night, while hosts that have added new listings continue to expand their business.
What’s the advantage of taking an advance with Clearbanc versus a traditional financial institution?
Financial institutions and other lenders are unfamiliar with the technicalities of operating a short-term rental property, how their revenues are generated, and how to underwrite these hosts to provide them with capital to grow. Clearbanc has built an entire platform that is specifically designed for a host operating in the short-term rental space.Clearbanc has financed hundreds of hosts on short term rental platforms. Their knowledge of the market is integral to understanding how a host manages their business from a cash flow perspective. They don’t require you to complete a credit check and no fixed monthly repayments, as Clearbanc is paid back when your guests arrive!
Building a transactional history with Clearbanc will allow you to access larger amounts of capital to scale your short term rental business. Clearbanc has worked with thousands of entrepreneurs to help them expand their businesses.
At NoiseAware, we are all about helping you find the best resources for your business check out our next post on 6 Smart Home Upgrades to Improve Guest Reviews!
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