Get-rich-quick schemes don’t tend to work out in the long term but as Roger Toor discovered, there is one sure fire way to make a small fortune in a matter of weeks: profiting off major sporting events.
Before you start, make sure you don’t break any regulations or laws
*There are strict rules around advertising;
you could face legal action if you use branding on your material.
*Think twice about selling t-shirts featuring sports team
logos. Doing so could get you into copyright trouble.
*You don’t usually need an insurance policy to babysit, but
you may need to buy one if you’re driving. Also be careful about positioning
yourself as a taxi service, as there are rules around who can and cannot
operate a cab.
*It’s also always a good idea to check references of who
will be renting your home or hiring your teenager to babysit.
Toor made a mint not by gambling, but rather, by renting out his East London flat during the 2012 summer Olympic Games to tourists who had tickets for the big event.
Because his home was just a 10 minute tube ride away from the main Olympics sites, he knew he could charge handsomely, yet he was still shocked by just how much people were willing to pay. In two weeks he made £5,800 ($9,513) — about eight times his monthly rent.
“Normally I’d feel quite bad asking someone [to pay] so much for something that doesn’t cost that much, but that’s what people were charging,” said Toor, a technology entrepreneur who is now based in San Francisco.
Toor is just one in a long line of entrepreneurial people around the globe who have found a way to make money from the influx of visitors attending the World Cup, the Olympics, the Super Bowl and other big sporting events in recent years.
In the United States the American football championship — the Super Bowl — will be held in February close to New York City, one of the most expensive areas for hotel rooms and apartment rentals in the world. And in February, hundreds of thousands of people will flood Sochi in Russia, a pricey resort town, for the 2014 Winter Olympics .
Many of those tourists don’t just want a comfortable place to sleep, but depending on how long they plan to stay will also need services too, from babysitting to food shopping. So, how can you profit from a big sporting event coming to your town?
No single group has tracked how much money passes between sports fans and locals looking to make some extra money from renting a flat, offering babysitting services or doing bar work at the after-party, but Joel Maxcy, an economist and associate professor at Temple University in Philadelphia, said it could be quite considerable.
It’s basic supply and demand. The sudden invasion of sports fans rapidly increases demand for a variety of services. According to published newspaper reports, 116,000 tourists descended on Indianapolis for the 2012 Super Bowl; hundreds of thousands of people flocked to Vancouver for the 2010 Winter Games.
Local businesses can’t look after everyone and that leaves the door open for enterprising locals who are willing to move out of their homes temporarily or who don’t mind putting in a few extra hours of work in ways they might normally not consider.
Home sweet rental
Renting out your flat is one of the easiest way to pad your bank account. Christopher Lukezic, a spokesman for Airbnb, a popular international website where people list their property for rent, said that during the 2012 Super Bowl held in Indiana in the US, rental prices jumped 551% above what people would usually charge. The London Olympics saw prices skyrocket by about 100%, he said.
Naturally, the most important part of renting is getting the price right. Charles Oppler, a New Jersey-based real estate agent suggests considering what level others are pricing their places at, but said it also matters whether the renter will be throwing a party after the big event, how close it is to the stadium, or sites, and the size of the place.
Joanna Doniger, CEO of Tennis London, a company that rents homes to members of the media, athletes and business people during the Wimbledon Tennis Championships, added that the more bathrooms there are the better. “A house that has three bedrooms and one bathroom is not worth much money,” she said. “One bathroom is not going to work.”
Making people aware of your place is the next step. Most people advertise on websites such as Craigslist, Airbnb and similar local sites, said Oppler. In Europe Gumtree is also popular for property listings. There may also be event specific forums and a website where people can post a rental property, but be very careful about renting out a room in a property you don’t own, he said — it could break landlord tenant laws.
You will also need to collect a refundable security deposit and that too will vary from place to place. In New Jersey, you can’t collect a deposit of more than 1.5 times the rental cost, said Oppler.
There’s no set amount for a deposit in London, said Doniger. It depends on the house and how worried you are about it being damaged.
“If it’s a nice house with lovely white leather sophas and a white carpet then the deposit will be higher,” she said. “Ikea will be less.”
The main mistake people make, though, is pricing their property at too high a price, said Oppler. While you can make easy money, if you’re too greedy you won’t make any money at all.
Holding the baby
One sector that saw demand surge during the Vancouver Olympics was childcare. In the two months before the games, Martha Scully, founder of Canadiannanny.ca, a website that lists babysitters for hire, saw a 32% increase in the number of babysitters who signed up, while the number of people looking for childcare increased by 47%.
There was such an increase in demand for babysitters — Scully not only had tourists, but athletes, coaches and team officials using her site — that she had to advertise for new employees, something she doesn’t usually do.
A lot of the new recruits had some babysitting experience, but they weren’t in the full-time childcare business before the Games, she said. They just wanted to make money — and they did. It’s rare for a babysitter to charge more than $14 an hour in Canada, but nearly 70% of the people offering babysitting services through her site during the Olympic Games charged between $16 and $20 per hour.
If you want to offer childcare services, Scully advised putting together a resume, asking for reference letters, getting a first aid and Cardiopulmonary Resuscitation certificate and applying for a criminal record check on yourself, which you would then give to the person who’s hiring you. “It’s good to have that handy,” she said.
While some people do advertise on Craigslist and other free websites, a paid site like Scully’s makes childcare job applicants fill out an extensive profile. Only people who are serious about taking on a babysitting job will go through with the whole process, she said.
Of course, a roof to sleep under and someone to look after the children may be the most prevalent way to earn extra money when the big event comes to town, but there are other services you can offer tourists to make some extra money.
Services like driving, laundry, food shopping and cooking can offer a painless path to fast finances, said Clare Rayner, a UK-based retail expert. People don’t want to do their usual chores during these events, so think of doing something that can help fans take care of their daily needs.
“It’s interpersonal services,” she explained.
And then, there are even quirkier ideas. Joe Carell, a New Jersey-based construction company owner, hopes to capitalize on the Super Bowl, which is in his state this year, by selling two parking spaces on a piece of property he owns not far the stadium for $1,000 per day.
He doesn’t think he’ll get his asking price, but it doesn’t hurt to try.
“People are coming and maybe someone needs it,” he said. “And maybe I can make a few dollars.”
Shoring up your finances
For Toor, the London Olympics could not have a come at a better time. A year before the Games he left his job to start a company and was days away from running out of money entirely.
In two weeks he made enough money to cover his living expenses for the next three months and pay for a trip to San Francisco, where he was able to pitch his business and secure venture capital financing.
“If it wasn’t for this money I’d still be London,” he said.
He had to stay with friends for two weeks and could barely work during that time —but he said anyone who doesn’t mind the inconvenience consider the golden sporting opportunity.
“It’s a huge chance to make money,” he said.