Remote, WiFi-free vacation homes can bring in $30k a year
5 Minute Read
What you need to know:
- Some 60 % of people still check email on vacation, despite wanting to get away from screens. Vacation homes in a remote natural areas — without WiFi and minimal cellular service — are gaining in popularity.
- The startup Getaway has built ~200 tiny cabins in the U.S. in the last four years and has received ~$40m in funding.
How you can capitalize:
- Follow the Getaway model and build your own tiny cabins in forested areas near your city for ~$40k. At $150 nights and with bookings 200 nights a year you’d make $30k annually.
- Pay attention to popular national parks, which are seeing magnitudes more visitors the last few years, and build near them.
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This summer, I took a vacation to Kiawah Island, S.C. Almost every morning I was still checking email, Twitter, or Instagram—some of it work-related and the rest just pointless browsing (although once I did pull up Instagram for the vital reason of sharing a photo of a huge alligator!). Despite my best intentions to avoid my phone and laptop, and despite having a beach a quarter mile from my front door, the screens kept pulling me in.
I was vacationing like everyone else. Nearly 60% of employees use work-related email on their vacations, according to a LinkedIn survey. And that number grows higher with income: 93% of people who make between $180k and $200k check email.
These numbers are high despite constant warnings about burnout and screen time overload.
Enter a new yet growing phenomenon: the unplugged vacation home. They have the grandeur and simplicity of glamping but the homes are often more remote, without any potential for using WiFi or cable, and in some cases any cellular service. In the Oregon wilderness, the renowned Summit Prairie vacation home is booked for the rest of the year. On any given weekend next summer at the Quirpon Inn, located on a remote WiFi-free northern tip of Newfoundland, most of the 10 rooms are sold out.
The startup Getaway, which builds and rents tiny cabins in forested areas outside US cities, has received nearly $40m in funding since its founding 4 years ago. Though numerous businesses and individuals rent cabins and similar structures on VRBO, Glamping Hub and the like, Getaway’s emphasis on isolation and its strategy of renting from its own website are rare.
Opportunities exist for entrepreneurs to build their own unplugged vacation homes or vacation home businesses near lesser-known national parks and near cities that aren’t on the East Coast. And as the lack of vacancy at established unplugged sites illustrates, demand often outweighs supply.
The return to nature
Remember when everybody went to Las Vegas for glitz and gambling and regrettable night clubs? This year Vegas resorts dropped their prices after visitation rates hit a 4-year low in 2018. Urban vacation destinations like Washington D.C. and Los Angeles have experienced tourism gains every year, but typically at 2 to 5% growth.
Meanwhile, national park attendance has skyrocketed. From 1980 to 2014, the total number of visitors to national parks rarely surpassed 275m. Since 2015, it has been above 300m every year.
Generational shifts on two fronts underlie this outdoorsy trend. Retiring boomers want to get outside, and hustling millennials want a break from hectic work schedules.
When Jon Staff and Pete Davis were at Harvard Business School and Harvard Law School, respectively, they noticed everyone around them was burned out and seeking escapes from their workload and the city. Staff and his father decided to build a tiny cabin in New Hampshire about two hours outside Cambridge. The idea later turned into the company Getaway.
Getaway’s seed round was about $1.4m. After an infusion of capital in 2017, $15m in Series A funding, Getaway expanded to have about 40 cabins outside Boston, 12 outside New York and 30 outside Washington D.C. By the end of this year, Getaway expects to have ~200 cabins near Dallas, Los Angeles, Portland, Atlanta, and Pittsburgh in addition to Boston, New York, and Washington. It recently closed a $22.5m Series B round.
Rachel Mansfield, Getaway’s VP of marketing, says the company’s strategy is to purchase enough land in every location to fit 30 to 40 cabins, each on its own acre. Getaway often finds the land on old campgrounds. The cabins feature a bed, a large window usually facing trees, an outside fire pit, a shower, and cooking supplies. There is no WiFi, and cellular service is spotty. Guests are encouraged to lock their phones in a safe.
Mansfield declined to provide the company’s annual revenues or occupancy rates. Back of the envelope math suggests a quick return on investment:
The average cost of their tiny cabins is about $40k. Getaway’s cabins typically go for between $100 and $150 a night during the week and ~$200 on the weekends. Many of the locations are completely booked on weekends through the rest of the year. If a cabin is booked 200 days out of the year at an average price of $150, the per-cabin annual revenue would be $30k.
Staff has given 3 major reasons for why unplugged vacation homes will be successful:
- Disconnection: “Throughout human history us humans have actually had a long time to sit and think and sort out our thoughts and sort out our feelings. In a world that’s becoming ever more connected, ever more overwhelming, ever crazier, that is something worth building into our future.”
- Nature: “As you and I…move more and more into cities as globalization happens, the desire to return to the wild is stronger.”
- Leisure: “It’s required that we carve out time that is not spent chasing productivity.”
Whether you want to start a full company like Getaway or put one unplugged property on Airbnb, there are several ways to improve your chances of capitalizing on this trend.
Follow the national parks visitors: The possibility of building an unplugged vacation home near or on the property of one of the major national parks—Yellowstone, Yosemite, Zion, Joshua Tree, etc.—is unlikely. The biggest parks are dealing with major overcrowding issues. But the United States is teeming with less-heralded national parks that are seeing huge growth rates, as tourists choose less-crowded areas.
For example, Big Bend National Park, located along the Mexican border in Southwest Texas, has seen visitor traffic increase from 314k in 2014 to 440k last year. Pictured Rocks, in Michigan, has gone from 527k visitors in 2014 to 815k last year.
You can use this tool to track annual visitor numbers at every national park, dating back decades.
Focus on the high end: Remember how 93% of people making ~$200k a year can’t put down their phones on typical vacations? They will pay major prices to unplug. The Sheldon Chalet in Denali National Park costs $3k per person per night. The price of building a high-end structure would obviously be higher and would require a more scenic or novel area. But it could be worth the investment.
Of course, Getaway has proven that medium-priced vacation homes in remote locations work, too.
Think local: Getaway is based in Brooklyn but owns cabins throughout the United States. People can use their local expertise to identify popular nature areas around their own cities and pounce on opportunities to build their own tiny vacation cabins before established players enter the market.
And remember to emphasize the isolation as a perk and keep the WiFi out.